Customer Reviews:
Loads of great knowledge, but hard, hard work!.......2007-06-01
I read this book a couple of years ago, and found it fascinating and highly detailed. I imagine that for some very technically minded people this is something they can really get their teeth into and enjoy. But for simple folk like me, it was just too much, and I found much simpler methods to interpret Elliott waves that didn't take half as much time or knowledge. So, I give it a 3 star rating as its brilliance is somewhat dampened by its complexity.
Not for the majority........2007-02-20
This book is very complictated. One might have a chance if this book was treated as textbook and offered in a university over a semester long class, taking each chapter apart with live examples.
Other reviews mention that it takes years to master this method.I somewhat agree. The rules of logic are not clear and that is mainly because if the autor wanted to go to great lenght to explain everything this book would be around 2000 to 3000 pages. So, you gonna have to figure it out on your own and that will take you a lot of time!
Get an Elliot Wave Charting software you'll save yourself a lot of headache and time.
excellent style.......2006-08-17
Books concerning Elliot Wave in Taiwan, no matter it is a translation version or the texts used by many teachers in teaching technical analysis, never have the style that
Mr. Glenn Neely has in his book. I must say that this book
expresses the topics in a concise, step-by-step and to-the-point way, it's a great book that I've ever had; no book can exceed its excellence. If possible, grant me the right to translate it here in Taiwan.
very difficult.......2006-06-30
Very hard to understand, if you can read, understand and enjoy this book at all you could probably give the boys a hand in Egypt with the Hieroglyphics ........If you enjoy scientology well this one's for you!!!!!!!!!!!
like learning to ride a bike.......2006-04-22
You really don't need this level of detail for Elliot wave trading to increase your P&L. Like any other trading systems, elliot waves mostly work except when it doesn't. Without years of experience and gains and losses you won't have the confidence to make a huge P&L. Buy a simpler book unless you are really into Elliot Waves. Enjoy the third waves.
Book Description
This book was first printed in 1938, having been written as a Ph.D. thesis at Harvard in 1937. Our good friend, Peter Bernstein mentioned this book several times in his excellent Capital Ideas which was published in 1992. Why the book is interesting today is that it still is important and the most authoritative work on how to value financial assets. As Peter says: "Williams combined original theoretical concepts with enlightening and entertaining commentary based on his own experiences in the rough-and-tumble world of investment." Williams' discovery was to project an estimate that offers intrinsic value and it is called the 'Dividend Discount Model' which is still used today by professional investors on the institutional side of markets. Appendix, Tables, Index.
Customer Reviews:
Awesome book on classical valuation.......2007-01-05
This is probably one of the oldest, if not the first, serious academic works on valuation. The coverage is highly theoretical compared to the more practical valuation books of today (dividends are used instead of free cash flow, continuous time is used instead of discrete time, and "cookie cutter" product cycle scenarios are presented instead of more complex business forecasting).
The real value of this dissertation-turned-book though is its general insights. Although Warren Buffett doesn't tout this book as often as Graham's "Intelligent Investor", you will find that he utilizes the insights from this book almost as frequently.
Robert Stephenson-Padron
MSc student (economics & finance)
University of Navarra, Spain
An important work.......2006-06-15
The Theory of Investment Value is clearly an important work, as reflected in Benjamin Graham's citations to it and the prevalence of the dividend discount model in valuing stocks. The theories expounded in this book are of particular import to those to seek to by stock at a value less than the intrinsic value of a company as they determine it to be.
The book itself initially appears intimidating, as there are a lot of mathematical equations, but in reality, the math is nothing more than simple algebra, mostly different models related to computing dividend values going forward.
I found the book to be an interesting read, but it is highly theoretical in nature. The central theme of the book is that stocks are worth the present value of their dividends, paid in perpetuity. It does not discuss earnings manipulation, effect of dilution, securities with superior or inferior claim to payment, etc. Moreover, as Graham points out in Security Analysis, companies that have a high return on invested capital would be well advised to reinvest their profits, while less successful companies would be better off paying higher dividends (relative to book value). This would, of course, tend to make the practical application Williams' theory somewhat complicated, insofar as it makes computing future dividends more difficult.
Readers looking for a more practical guide to valuing stocks might be better served reading Securities Analysis by Benjamin Graham, or any number of more "practical" books related to stock market analysis, particularly as those analyzing financial statements to determine the intrinsic value of a company. Some readers might also find "The Aggressive Conservative Investor" by Marty Whitman and Martin Shubik to be a good read for a competing view, since the authors of that book take the position that, with respect to non-controlling shareholders, a company's stock is worth the net after-tax cash that they expect to realize in the future, whether from dividends, liquidating events, etc. However, if a reader is truly interested in obtaining an understand of how dividends affect stock prices, the book is a worthy read.
Heavy Stuff.......2005-09-21
Helpful book for a Fundamental Value Investor since it layed the groundwork on DCF methodology (1934). Helped me to understand how the DCF or Dividend Discount Model was derived but a good undderstanding of economics is required to follow the author's concept. The two case studies are a bit dry but very interesting both from a historic and Value Investing perspective.
Definately worth reading!.......2005-05-18
This truly is a fantastic book on stock and bond investing. It's one of the best investing books I've ever read. Toss out your mass-market Peter Lynch books, this one really gets down to what determines how much a stock is worth, which most ordinary investors probably don't understand at all. It shows you how to calculate intrinsic value and is full of math. Trust me, I'm no mathematician but I still loved it.
This is one of the books that influenced Warren Buffett. However, I would recommend this over Benjamin Graham's "Security Analysis" or Philip Fisher's "Common Stocks and Uncommon Profits". There's a reason why "The Theory of Investment Value" is still in print almost seven decades after it was first published.
Amazon.com lists the length of this book as 240 pages, but it is really 564 pages long.
Truly one of the most amazing finance books I have ever read.......1999-11-19
A book like this will continue to be a valuable investment for as long as there stock markets
Book Description
Learn how to forecast the market with Elliott Wave Theory
In Applying Elliott Wave Theory Profitably author Steven Poser shows readers how to trade using Elliott Wave Theory-a powerful technical analysis tool used to forecast the stock market-through easy-to-follow trading strategies, while offering clear explanations on how to interpret this method's numerous patterns. Step-by-step guidance breaks down the Elliott Wave Theory and provides strategies that a trader can put into action along with a complete explanation of how and why the Elliott Wave Theory works. Applying Elliott Wave Theory Profitably shows readers where to look for external clues, and how to use these to improve their trading performance.
Steven W. Poser (Upper Saddle River, NJ) is President and founder of Poser Global Market Strategies Inc., an international stock, bond, and currency markets trading advisory firm. Mr. Poser publishes a daily newsletter that covers these markets from a technical and fundamental perspective. He holds a post-MBA degree in finance, as well as an MBA in economics and a BA in mathematics and computer science.
Customer Reviews:
Outstanding Book on Elliott Wave Analysis.......2007-05-04
I am a CMT (Chartered Market Technician) -- for the exam process of the CMT, which is a professional exam for technical analysis that demands a significant amount of knowledge on Elliott Wave analysis, I had to read many books on this subject and it was difficult to ascertain a useful book on this subject; this book undeniably gives you a credible approach to Elliott Wave analysis. Indeed, in terms giving the reader an approach to any market (e.g. bonds, equities, commodities or currencies) this book is written in the most useful manner that I have read on this subject. In particular, it gives the reader a practicle methodology in approaching the markets so as to enable you, the practitioner, to break the market down within this type of analysis on a step by step basis, if you will, that is logical. I recommend this book without reservation!
Well Written.......2006-07-18
I recently completed the CMT (Chartered Market Technician) exam process- this is a professional exam for technical analysis, consists of three levels. The third level has a substantial section on Elliott Wave. I have read other books on Elliott, but this book was in my opinion the best written. Mr. Poser made a difficult subject much easier to digest. The real strength here is in discussing what NOT to do when using Elliott Wave- by keeping these tips in mind you will find you can readily apply the techniques to charts from various financial markets.
I highly recommend this book to anyone taking the CMT exam, especially those who don't use Elliott Wave in their trading and/or analysis.
Highly disorganized book without real value.......2006-07-04
The book is easy to read but there isn't much of a content in it. There is no definite EW analysis system step-by-step. Just some elaboration on the topic all the way through and some examples. It doesn't teach anything. And there is definitely no trading system. It was probably intended as a tool for general prediction only. The book is not for traders at all. Perhaps, it is for market analysts.
The author shows how others use or interpret Elliot Waves Theory improperly. But he doesn't tell how to use it properly instead.
I don't understand what other reviewers with positive feedbacks talk about. The don't seem to refer to the right book. There is something fishy going on.
No Practical Value........2006-05-26
I buy books that include trading strategies source code that you can apply and trade, books like this have no practical value. If the author have BS comouter science, he should be able to write the source code.
A REVELATION IN TRADING.......2006-01-18
I've traded off and on for years now (Forex) and though I've done moderately well, it wasn't worth the anxiety I suffered watching each tick play out.
I need to feel comfortable and confident with my trading. I also needed to know when to anticipate best entry/exit.
This book not only allowed me to do that but it GREATLY decreased the size of my losing trades. No matter what, you will have losers but with this book you will know when your trade has taken a turn for the worst and get out quickly.
Another huge advatage I gained by reading this book is that I no longer sit by my computer watching the ticks go by. I now enter a trade and forget about it. I check in every morning and evening to see if my limit or stop was hit and to review my charts a bit but that's about it.
Charting has become entertaining rather than a task. It's amazing when you start seeing these patterns jumping out at you.
Now I will also add here that Wave Theory alone is NOT enough. You've got to use indicators as well to determine whether your wave count is even accurate but do this and you will be on your way to profitable trading.
Bottom Line: This is definitely a GREAT book and well worth the money.
Book Description
In Financial Risk Taking, trader and psychologist Mike Elvin explores the complex relationship between human behaviour patterns and the markets, offering the reader a context in which to assess their own strengths and weaknesses as investors. The book offers an apposite and uncomplicated system of skills development in the form of competences and competencies that can be applied anywhere along the continuum from casual investor to full-time day trader. Elvin presents a Comprehensive Model of Trading Competence (the MOT) as well as the concepts of analysis and refutation, the paramouncy principle, and self-sabotaging behaviours such as the Santa Claus syndrome and Bohica effect.
Areas covered include:
- Emotions - are they functional or disabling? How do the mechanisms of fear, greed and panic work?
- Motivation and perception - how do belief paradigms affect perception and performance?
- What perceptual errors influence decisions to the trader's detriment?
- Information processing and risk assessment - how does information overload affect Stress How does stress affect investment decisions?
- Technological and mathematical anxiety - why do we avoid learning the skills we most need? What levels of ability are required?
- Can psychological and biological theories assist in our understanding of investors' performance?
Download Description
"In Financial Risk Taking, trader and psychologist Mike Elvin explores the complex relationship between human behaviour patterns and the markets, offering the reader a context in which to assess their own strengths and weaknesses as investors. The book offers an apposite and uncomplicated system of skills development in the form of competences and competencies that can be applied anywhere along the continuum from casual investor to full-time day trader. Elvin presents a Comprehensive Model of Trading Competence (the MOT) as well as the concepts of analysis and refutation, the paramouncy principle, and self-sabotaging behaviours such as the Santa Claus syndrome and Bohica effect.
Areas covered include:
- Emotions - are they functional or disabling? How do the mechanisms of fear, greed and panic work?
- Motivation and perception - how do belief paradigms affect perception and performance?
- What perceptual errors influence decisions to the trader's detriment?
- Information processing and risk assessment - how does information overload affect Stress How does stress affect investment decisions?
- Technological and mathematical anxiety - why do we avoid learning the skills we most need? What levels of ability are required?
- Can psychological and biological theories assist in our understanding of investors' performance?
"
Customer Reviews:
Trading and Emotional IQ.......2005-08-17
This is the first 'trading' book I've read that explicitly offers advice on suicide. Here is the final sentence of the last chapter, the one on depression and suicide: "...seek out a counselor, to find your way to God as you understand Him, or whatever it is that you need to do to end your pain, loneliness, and hopelessness. If you can manage this, and do something very small every day, I know you will get through your period of loss, and I will feel tremendously grateful for having shared some of your experience with you through this book."
This is not a book on 'how to trade'. Loosely, the book is a psychologist's autobiographical 5 years in the trading pit (ok, in front of a trading screen). The first section covers Dr. Elvin's frustrations with finding a teacher and the second lightly touches on trading techniques. This is all rather flimsy material, but represents a fair picture of the pitfalls facing anyone trying to 'learn' trading by sitting in classes.
The 3rd section on 'perceptual bias' is very good, and obviously takes advantage of Dr. Ervin's 'real job', clinical psychology. There is brief but concise descriptions of the 'primacy error' (we are unduly influenced by experiences immediately prior to a decision), the 'availability error' (we tend to take the easy way out) and the 'Halo effect' (a good trait blinds us to the bad). Other topics include the 'misplaced consistency theory, the 'sunk cost error', 'prospect theory', 'self-deception bias', 'representativeness bias', and 'sampling bias' (law of small numbers). As an answer to this, Dr. Elvin briefly argues against the Neo-Platonic efforts to exclude emotion from decision making, and recommends assessing one's Emotional IQ with a view to improve it. A few well placed emotional disasters pulled from the author's trading experiences illustrate the points nicely.
Concluding that emotional issues are the primary blame for trading disasters, the 4th section covers the delights of Zen meditation and taking on the self-image of a warrior-trader. The book suggests this is the path the author finally chose. We don't end here, though. Instead, Dr. Elvin launches into a fascinating discussion suicide, the suicides of famous traders and gambling addiction, again with personal insights to his own dark moments.
All of these materials are covered in more detail elsewhere, but Dr. Elvin's consistent reference to his own trading experiences provide a relevance missing in more academic work. The summary chapter suggests the author was trying to write a model of trading competence. Using this goal as a measure, the author has failed to deliver. The offered measures of competence seem designed for accountants. The messy comments on assessing one's emotional IQ are hard to package in terms of competence. The juxtaposition of brave 'warrior trader' and 'suicidal trader' illusions speak to the difficulty of the subject. I suspect the author recommends we meditate on these issues.
Get the book, read and apply it - worth the effort.......2005-02-17
I don't normally write reviews, but I think that this is a great book. Serious traders should consider adding this to their library of reference material.
I have a trading library that contains most of the classic trading books, including more than a dozen on trading psychology. The key is to find the "gems" in each one and figure out how to apply them in our own personal style of trading.
This book is unique in three ways:
1. It pulls together some of the "gems" from the classics so the information is more accessible in one place.
2. The author lays down an excellent framework (structure) for being a successful trader - not just today, but a broad set of integrated skills the must be mastered & balanced. This is actually a interrelated set of "competencies" that the author outlines.
3. A "Model of Trading" is identified at a high level, and presented in a strategic and tactical flow chart. Some text supports the flow charts.
There is no "one book" that covers it all, but applying the information in this book would help the individual trader develop his trading career and bring it to a more professional level.
Another view.......2004-11-17
Well, I don't know if "fascinating" is the word I'd choose for this book, though I'm not entirely sure that the word "book" is appropriate to describe it either.
I'm sure Elvin is a very nice person and I applaud him for the journey he undertook to achieve trading competence, assuming that he ever did (achieve trading competence). However, this is not so much a book as a very long -- and I mean VERY long -- research paper. In effect, Elvin provides the glue to hold together not only the views of others but also sometimes lengthy passages from their books. Rather than contribute anything new to the literature, he provides what is called a "review of the literature", and that review is somewhat shallow. For example, the facility with which he assumes the value of certain elements, such as Fibonacci, even though there is no evidence that they have any demonstrable value at all, toots "new trader", giving the book a sort of What I Learned During My Summer Vacation After Being Screwed By A Guru quality.
In a way, it reminds me of those compilations one sees advertised on late-night television: a few minutes of one movement from some symphony, a sampling of an aria from some opera. If this style encourages one to investigate the source material, all to the good. But at $45 ($70 MSRP), it's a bit steep for a sampler.
I suggest, therefore, that dear reader get this book from the library first in order to find out if it's truly what he wants. It may instead provide leads to those books which might actually benefit the reader in the way he had in mind when he sought out the book in the first place.
Commodity, stock and options traders need this book.......2004-09-03
Financial Risk Taking by M. Elvin contains a fascinating blend of practical trading ideas from the trading masters and psychological studies from the academic world. It covers more than the title implies and discusses trading methods, trading as a business, trading standards and trading psychology. Dr. Elvin is himself a trader, clinical psychologist and business person whose illustrations on trading covers his own errors as well as his developing wisdom as a trader. Recommended for traders at any level, from novice to advanced. If you need a first book on trading or a last book on trading, this is it.
Average customer rating:
|
The Edge of Chaos: Financial Booms, Bubbles, Crashes and Chaos
Bernice Cohen
Manufacturer: John Wiley & Sons
ProductGroup: Book
Binding: Paperback
 General
| Popular Economics
| Business & Investing
| Subjects
| Books
International
| Economics
| Business & Investing
| Subjects
| Books
Microeconomics
| Economics
| Business & Investing
| Subjects
| Books
General
| Business & Investing
| Subjects
| Books
General
| Investing
| Business & Investing
| Subjects
| Books
Chaos & Systems
| Mathematics
| Professional Science
| Professional & Technical
| Subjects
| Books
Finance & Investing
| Finance
| International
| Accounting & Finance
| Professional & Technical
| Subjects
| Books
ASIN: 0471969079 |
Book Description
Spanning two centuries and across three continents (Europe, America and Asia), the author provides a fascinating history on some famous and not so famous financial events. Beginning with the 1720s Mississippi and South Sea Companies to the great global crashes of 1929 and 1987, Bernice Cohen provides us with a strategy for tracking market trends and cycles, and protecting our investments against the next financial crash.
Customer Reviews:
Summary of the book.......2000-06-22
Introduction
The objectives of the book are: To study in detail the stock market crashes, to discover what went wrong and to learn from these past traumatic episodes; and To identify and explain the underlying structure of the financial market behavior.
Chaos is Discovered Newtonian vs. Chaos For the last 300 years, our thoughts have been profoundly influenced by the Newtonian theory, which, as we know, rests on assumption of a linear system. This theory is best applied to system with two objects interacting with each other. When used to elucidate the system with three objects or more, Newtonian theory collapses.
Chaos theory, which is based on complex and non-linear system, is a relatively new discipline (circa 30 years). Its use in social science and field of physics have gained wide acceptance. The author attempts to apply the theory to the financial market.
Chaos Rules
Chaos describes unpredictable behavior that is governed by rules. Ian Stewart in his book, "Does God Play Dice?" gives the following definition: "Chaos is lawless behavior governed entirely by law".
Chaos in Financial Market
The author comment regarding the stock market behaviors using the chaos theory is as follows: Financial market is inherently unstable and dynamic system, and the mood of the majority of its player can flip almost instantaneously from one state to another. Hence financial market resembles a chaotic system. An orderly phase may dissolve into chaos & then tip back to a more ordered state. Stock markets are holistic that sometimes their collective behaviors will be different from that of their component unit (i.e. individuals & investors).
Chaos Theory in Actions After noting the similarities between financial markets behavior and chaos theory, the author studied several important financial crises over the last 300 years to see whether there was any underlying structure beneath the crashes. She discovered that many speculative bubbles shared a cluster of common features. \ The author does not try to predict when the crash will happen. Instead, she seeks to uncover what is the underlying structure of financial market and how investor can profit from it by assessing in which phase he is at a particular time.
The author studied the following crashes and described the sequence of events using the ten phase structure: 1. Bubbles of 1720 Mississippi Madness South Sea Fiasco 2. Modern Bubbles Great Crash 1929 Global Crash 1987 Japanese Bubble Bonds Bubble
So what if we know the history and chaos theory?
How To Be Prepared? Compiling a checklist based on the structure of crash scenario (ten-phase structure) has the following purposes:
It is a systematic way of dealing with the situation. It provides an orderly framework to analyze the signals and prepare oneself for any occurrence of the crash; and
It helps the investors to judge more clearly how far along the route of chaos scenario has progressed.
(The checklist is elaborated in the textbook).
In addition to the checklist, there is also a need to look out for other cluster of symptoms or occurrence of other events (such as emergence of new financial tools, collapse of big corporations etc) to confirm the findings from the checklist.
What to do with the checklist? To avoid any avalanche of selling, one must be able to identify at least the first 3-5 phases and clear your position at phase 5 or 6 (i.e. when gullible public joins in or when doubt starts to form).
However, if one misses the signal and fails to sell off by phase 6, it is still not too late to do so as long as it is done before the markets reach the bottom. This will allow one to cash out and reinvest when the markets hit the bottom.
What if u misses all the phases? - As the chaos theory shows, the market will turn around eventually. However, the issue is how long will it take? No one knows.
Timing the Crash - Is it possible? Whilst it may not be too difficult to identify the signals of an impending crash (based on the phases in the structure of crashes), one can never accurately predict the timing of occurrence. Time is the most untrustworthy and unpredictable element. As shown in the charts, the points might get squeezed together or pulled part -- this is a common feature of a chaotic system.
Since predicting the exact timing of crashes is highly unreliable, in order to avoid being caught off guard, one has to closely watch for any trigger event that may unleash a selling cascade. Another strategy is to give up the hope of catching the extreme peak and bottom and be contended as long as you buy near the bottom and sell near the top.
Conclusion
Chaos theory has taught investors how to preserve their capitals from the disaster of a crash. The 3 main points to bear in mind are as follows:
Need to recognize any unintentional actions of the financial authorities which may create a classic chaos conditions and prepare own course of actions;
Even the most sophisticated and cautious long term investors can become irrational and act in tandem with the speculators; and
Understand that falling bond prices with rising interest rate may result from the collapse of a financial pump instead of a reflection of the fundamental outlook of the economy.
One of the most important events to watch is the action by the presiding authorities which may trigger a financial pump and set the phase transition in motion. When it happens, one should know how to react.
In conclusion, as a Fund Manager, one should
Be fully aware of what is happening in the financial, political and economic sectors around the world. One of them could be the trigger event. Be able to identify at which phase the financial market is in and predict the transition and the edge of chaos. Be able to clear his position and not to be influenced by the herd behavior if he concludes that the market at peak and near the point of collapse. This is a tough discipline to follow especially if he has a strict mandate and the clients' expectations increase during the boom.
Customer Reviews:
Profiting from Chaos--2003 Nobel Prize in Economics Winners.......2003-10-11
The topic of this book: Using Chaos Theory for Market Timing, Stock Selection and Option Valuation--corresponds to that area of Economics reflected in the current Nobel Prize in Economics Winners for 2003! This book by Tonis Vaga, "Profiting from Chaos: Using Chaos Theory for Market Timing, Stock Selection, and Option Valuation", Dec., 1994; ISBN 0-07-066786-1 is about 9 years ahead of its time. The original definition of chaos emphasized the apparent unpredictable behavior arising in a dynamic deterministic system because of great sensitivity to initial conditions. If two arbitrarily close starting points diverge exponentially so that their future behavior becomes unpredictable then chaos has arisen! This is characteristic of weather, stock markets, and commodity markets. However, short term and middle term weather forecasting is performed regularly before the long term effects of chaos sets in. This is the same type of strategy used in this book for Market Timing, Stock Selection, and Option Valuation by use of Chaos Theory. There is an underlying regularity in a function that exhibits chaos which can be revealed by systematic perturbations to the trajectory. Just like weather forecasting can be successful by redefining the short and medium term (i.e., defacto systematic perturbations) then "Profiting from Chaos" in the short and medium term is also possible. The Nobel Committee in Oslo, Norway has just confirmed the underlying thesis of Tonis Varga's book by this year's Nobel Prize in Economics award! I suspect that a revised edition will now be in the works, but get the original version before it is too late!
Interesting.......1999-01-01
The coherent market hypothesis (CMH) presented in this book is an interesting alternative to the commonly used efficient market hypothesis. However, nonlinear dynamical systems have had less impact on economics than on other sciences. For good reasons. In economics there is rarely a theoretical reason for expecting to find one form of nonlinearity rather than another. As a result, the concepts presented in this book are quite interesting, but none of them is particularly convincing. In addition, the complex mathematics are not clearly explained. Empirical verification of the CMH is therefore extremely difficult, if not impossible. The practical value of this book is rather limited and does not provide enough reasons to abandon the assumptions of the efficient market hypothesis as a basis for day-to-day trading decisions.
Book Description
Sometimes the biggest risk of all is taking one, and the need to be sure you are making the right choice actually increases the risk. The market is not efficient and hedging doesn't work. To rely on charts to understand the market is Mamis' way. The author is an excellent market technician who offers sound financial guidance and insights into the prepared mind. He gets your thinking going with a comfortable investment philosphy that will often go against convention. There are enough anecdotes, war stories, and charts to make for sound advise. The path to market freedom is technique, and you don't have to be one of the best traders to succeed with experience. It seems to me that the entire 1990s have confirmed the ambiguities of market language and how to operate in such a world. You will know how to keep risk at bay which most of us find not to be an easy task. 241 pages.
Customer Reviews:
The Nature of Risk.......2007-05-06
One of only a handful of must read, must own books for any trader.
Still near the top of the list.......2004-01-11
It's been four years since I first reviewed this book (see the next to the last, below), and I still consider it to be absolutely essential for anyone considering any sort of involvement in the financial markets. In fact, it's probably essential for anyone who is considering anything at all that entails more than minimum risk.
The amateurs miss the point. This is not about the best stochastic settings or how to massage the bid and the ask. This is about facing up to the very real risks inherent in the financial markets, including the very real risk of financial ruin. Amateurs don't see the risk; therefore, they don't bother to grapple with it. Instead, they would rather blow up and disappear. If one wants to last, he must come to terms with the nature of risk, his own tolerance for risk, an understanding of how to manage risk. Without that, he's doomed.
Best book I have read on the psychology of trading!.......2002-06-17
I was reluctant to buy this book based on the first reviews I read. However, I have been daytrading for four years now, and frequently go against the crowd. Perhaps it is this contrarian view that keeps me in this business. I manage a proprietary firm in Denver (Bright Trading) and recommend this to ALL the new traders as well as veterans of the craft. It is fresh, insightful and really gets to the meat of what makes one trader successful while another fails. A great companion to this book is Mark Douglas' book Trading In The Zone.
Not useful if you have the 2 better ones.......2002-04-16
Firstly, I have a lot of respect for Mamis, so this is NOT to run him or his writing style down.
In-fact, I have given his other books, When to Buy and How to Sell the Five Star ratings as they are very useful and well written.
However, after reading those, this book seems to repeat some of the points made in them and seems a little defensive about Technical Analysis. Avoid this one but positively buy the other two.
So-So.......2001-09-08
If you are going to buy one of his books, get "When to Sell". This one was long, wordy, and tough to read the whole thing - looking for content. Lots of fluff. Could have used a good editor.
Average customer rating:
- Dow 40,000, Dow 1,700
- Innovation is the root of confidence in capitalism
|
The Great Cycle: Predicting and Profiting from Crowd Behavior, the Kondratieff Wave, and Long-Term Cycles
Dick Stoken
Manufacturer: Probus Professional Pub
ProductGroup: Book
Binding: Hardcover
General
| Popular Economics
| Business & Investing
| Subjects
| Books
Microeconomics
| Economics
| Business & Investing
| Subjects
| Books
Theory
| Economics
| Business & Investing
| Subjects
| Books
General
| Business & Investing
| Subjects
| Books
Stocks
| Investing
| Business & Investing
| Subjects
| Books
Production & Operations
| Management & Leadership
| Business & Investing
| Subjects
| Books
ASIN: 1557384878 |
Customer Reviews:
Dow 40,000, Dow 1,700.......2006-02-20
Anytime the DOW average falls 16 2/3 percent or more and reaches the lowest level for the year, we can consider it a bear trend. When determining when to buy, watch for the following pattern: during a Kondratieff upswing, the low of the bear trend prior to the last bull market high is the important prior low because, when it is broken, it tells us that we are near the low of a major bear market. The generally weak financial conditions make it unlikely the DOW will rally back and make a new high following a bear trend. At the beginning of the depression phase it appears that for a bear trend to be an important prior low, it must be a five year low or more. A buy opportunity occurs shortly after the break of the important prior low. It takes courage to buy at this moment and the investor will need to break the prevailing pessimism and buy. In this case the investor could wait three months before buying.
The following pattern signals its time to sell. During Kondratieff up waves, a psychology of increasing optimism leads people to extend their economic commitments. The result is a three stage bull market, these secular bull markets generally last eight years and sometimes longer. The first stage is recovery and lasts until the DOW has hit an all time high. The second phase induces major changes in perception and represents a shift in investor sentiment where the investor suddenly turns his economic outlook to a favorable economic prospective. Suddenly there is a significant number of new risk takers, who are attract to buying stocks and this creates a vast reservoir of buying power and a new bull market emerges for a minimum of four years too 49 months, a 16 2/3 percent or more break occurs downward price pressure, but too many people believe the stock market is a good place to be and are willing to buy back the break. The DOW returns to a new all time high following the setback and investors think they are on the brink of perpetual prosperity, 49 months pass in the third stage and its time to think about selling.
If the past is any guide to the future, we can expect to see a series of bear markets, during which there is a chance the DOW will shrink to at least 1,700. We are in the last up third wave, as the DOW has surged past 11,000 mark and third wave, peaking around 40,000. If the third wave started in 2002 and it will run between 4 year too 49 months and should peak around 2009. 2009 would complete the four year - 49 month cycle and should signal its is time to sell. By selling the investor acts prudently waiting waiting for a new long wave buy pattern too emerge.
Innovation is the root of confidence in capitalism.......2006-02-17
Technology innovation restores faith, the root of economic confidence in capitalism. Long wave cycle merely reflects the emergence of a breakthrough technology. Depression reflects the abandonment or pessimistic outlook towards capitalism and during depression investors seeks safety, security, and stability. Savings increase during depression and investment reduces. In order to make predictions, real interest rates must make known the inflation rate of the prior year and the current year (i= [CPI(this year) - CPI(last year)] / CPI(last year)). Over speculation occurs when long-term interest rates exceed real interest rates.
When a new breakthrough technology emerges on the market (10% market adoption), the new technology is rapidly applied to a wide number of sectors; the rapid deployment of technology creates a strong surge in demand, for capital too build the technology infrastructure; the new technology works, increasing production capacity and excess inventories; the overvaluation of demand and large inventories represents liability or inefficiency. The increased demand for capital is realized as long-term interest rates increase. Over capacity is realized and liquidation necessitated. During correction replacement technologies, such as, electrical for steam are not immediately adopted because of ROI apprehension and failure to adopt the breakthrough technology reduces efficiency that it could produce and therefore decreases profits. Growth and productive have not peak but the market begin pulling back sounding the possibility of recessive behavior.
Speculation must be atoned for by changes in human behavior. Investors repent from their "non conservative" viewpoints, returning too the comfort and safety of conservative investment thought. The behavior adjustment also applies economically, as one would socially (feminism to patriarchy, promiscuous sexual behavior to fidelity, immodest clothing styles to increases in length, and divorce to monogamy) and the similar economical analogy of repentance applies, as conservative values flow over into financial belief systems establishing a risk taking for safety paradigm, save in banks, now verses profit taking from rapid stock price, plan of the present verses competing for the future, and acceptance of large institution income sources verses capitalizing on small company profit growth.
The market takes a very positive economic outlook prior too entry into the depression and is characterized by 1. Reasonable low interest rate 2. and rising inflation 3. and high productivity 4. and high corporate earnings 5. and belief that political intervention will affect market behavior 6. and imperialistic manipulation of less developed countries siphoning currency in an attempt to save their failing currency.
As the market realizes they have over speculated, when long term interest rates excess real interest rates; the group begins to repent of their excessive optimism; liquidation of assets commences providing investors cash for future good investments; the negative affects of contraction are fought by companies, as companies push productivity and earnings; a second and more devastating contraction occurs collapsing stock valuations by 80 percent, housing valuations (40-50 percent) and severely increases excesses and obsoletes unessential survival inventory, as companies seeks avenues of consumer demand too sell their products and services.
The long wave is established, as investors slowly accumulate wealth, the wealth accumulation equates to security and validates their conservative viewpoints. The maintenance of these conservative viewpoints socially and economically provides a stabilizing entrenchment. Political entities realizes the have no significant power to influence the markets and political policies are proven to have not immediate affect on the market opinion.
Eventually, a new technology emerges that demonstrates such immense advantages that money moves from savings back into the market, as the next generation money stimulates company growth as investor speculate on the adoption of the new technology and risk cash investments to expand infrastructure to put in place the new technology, another boom market starts and the long wave moves in the upward direction. In the last century the break through technologies is 1. Oil and the automobile 2. Steam power and electrical 3. Computers and communication (internet, telecom, and optical fiber) 4. Robots and biotech.
Books:
- Masters of the Air: America's Bomber Boys Who Fought the Air War Against Nazi Germany
- Mathematics for Finance: An Introduction to Financial Engineering (Springer Undergraduate Mathematics Series)
- Mathematics for Finance: An Introduction to Financial Engineering (Springer Undergraduate Mathematics Series)
- Mathematics for Finance: An Introduction to Financial Engineering (Springer Undergraduate Mathematics Series)
- Mathematics for Finance: An Introduction to Financial Engineering (Springer Undergraduate Mathematics Series)
- McMillan on Options, Second Edition (Wiley Trading)
- New International Bible Dictionary
- New Trading Systems and Methods (Wiley Trading)
- Options, Futures and Other Derivatives (6th Edition)
- Options, Futures and Other Derivatives (6th Edition)
Books Index
Books Home
Recommended Books
- The Screenwriter's Bible: A Complete Guide to Writing, Formatting, and Selling Your Script
- Living Large in Small Spaces: Expressing Personal Style in 100 to 1,000 Square Feet
- Creativity Rules: a Writer's Workbook
- Global Studies: Africa
- History: Fiction or Science
- Maximum Ride #3: Saving the World and Other Extreme Sports
- Lichens of North America
- Accounting for Payroll: A Comprehensive Guide
- Bisk CPA Review Audio Tutor Financial Accounting & Reporting
- Maggie Darling: A Modern Romance
Applying Elliott Wave Theory Profitably
Elliott Wave Principle: Key to Market Behavior (Wiley Trading Advantage)
How to Identify High Profit Elliott Wave Trades in Real-Time
Fibonacci Applications and Strategies for Traders
Encyclopedia of Chart Patterns (Wiley Trading)
