|Moderated By: capitalistbeatnik -- (Not Moderated) -- Started: 5/13/1997 2:47:00 PM Revision History|
Since there appear to be many beginners and others who are scanning these threads I would like to ask everyone to pause to ask these questions:
1. Can any stock picking system work?
2. What is the evidence that TA (or FA) can beat the market?
3. Is the market fully efficient in pricing?
4. Is pricing history a "random walk"?
5. Has there ever been a short term trader who can beat buy and hold?
6. What motives would someone have for recommending a system (i.e. churning brokers fees)?
7. Why do people stick with systems or mutuals that can't beat index funds?
8. Has Michael O'Higgins come up with an effortless system to beat the Dow?
I think most of you know who browse this area know my views on these subjects. I believe in the weak version of the random walk, meaning stocks that go up tend to go up but that information cannot be used usefully in stock pricking to beat the averages. I do not believe that stocks are efficiently priced in the short term and that there are many bargains out there because of the different ways information is dispersed. I do believe that Peter Lynch is right that there is legal "inside" information at shopping malls about what is really selling that a Wall St. exec cannot see. I think stop-loss orders are a guarantee-win order for your broker. I thinks O'Higgins method is impressive. While most FAs can't beat the market, at least some do and I would love to know the name of a prominent TA who can. I am a clearly an admirer of Malkiel, O'Higgins and Lynch and have yet to be convinced of any value of CANSLIM or chartists.
Keep in mind the goal is to make yourself rich, not Charles Schwab.
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