I saw a paperback copy of Stan Weinstein's "Secrets for Profiting in Bull and Bear Markets" available in Borders for $19.95. Since I saw it recommended in the thread on books, I bought it. Its copyright 1988. Can anyone who has read this book tell me if his ideas are still valid?
Stan Weinstein
- Thread starter MainFramer
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I suspect many are NOT. It is my (unprovable) impression that the markets changed character dramatically in 94-95. It was during that time that the instutional money management + the Mad Buyers gained "critical mass" and became the tail that wags the dog. (We might even have a new "tail" with the large mass of hot-money hedgies flipping as much as a BILLION shares in a day.)
I'd recommend that all traders eliminate any reference to "how things worked" prior to '94.
Using weinsteins method did good during the bull run and the big drop. Also when 9/11 came and the rebound thereafter. I think it still basically works but you need to have a trend, i think around at least 2 weeks or so.
Recently (past few months), though, it hasnt really worked because the market has been very choppy. Using his methods, you'd be stopped out quite a bit. Which is why I've moved to daytrading the past months, taking gains when they're there, instead of giving back what you made yesterday or the past 2 days.
Recently (past few months), though, it hasnt really worked because the market has been very choppy. Using his methods, you'd be stopped out quite a bit. Which is why I've moved to daytrading the past months, taking gains when they're there, instead of giving back what you made yesterday or the past 2 days.
I kinda figured that might be the case. I've had a few quick stop outs already lately using other methods. I remember reading that Vic Sperandeo did day trading when markets got choppy. Hope we ge better days soon.
I'll refer you to one of my favorite websites. I know alot of people here don't appreciate these guys, but I think they know alot about the markets.
http://www.turtletrader.com/changed.html
http://www.turtletrader.com/changed.html
I spent a lot of time putting Weinstein's ideas into a mechanical system in TechnfilterPlus. Naturally I couldn't duplicate it exactly since he has a number of intuitive steps in his system, but results are still pretty good. Enough to be encouraging. However, if you trade this system through bear markets (and how can you really avoid that?) then you will accumulate some large losses.
I've been making trades based on the system I put together since January and am in the hole, but not by a lot. Stopped out on a bunch of trades, but have had a few good winners, too.
Overall, Sam's book seems like most of the crap you get from the vendoring crowd. Cherry-picked charts make it look like a sure thing. A real turnoff: the guy uses the phrase 'fabulous profits' on just about every other page. Gimme a break. But it's about selling books, after all.
I give Sam's book about a 4 on a scale of 1 to 10.
He did get me looking at weekly systems and that's been a good thing.
ges
ges, the problem more lies with you trying to implement "Stan's ideas" into a systematic trading system.
I think there's a great deal of similarity between Weinstein's book, O'Neal's and the general thrust of Trader Vic. These approaches to the market really require the trader to have a strong "sense" of what the current market conditions are, and not just blindly make trades cos the chart "looked right".
I think there's a great deal of similarity between Weinstein's book, O'Neal's and the general thrust of Trader Vic. These approaches to the market really require the trader to have a strong "sense" of what the current market conditions are, and not just blindly make trades cos the chart "looked right".
Weinstein is mentioned favorably in a number of trading books so I bought his book, read it, and thought it was good. Then I looked into how well he'd done implementing his own ideas. I looked up the performance of his newsletter "The Professional Tape Reader" in The Hulbert Guide (copyright 1993). Here are some snippets.
"Over the twelve years through mid-1992, Weinstein's model stock portfolio had a gain of 48.5% compared to 432.7% for the Wilshire 5000." (page 317)
"[his mutual fund] has done better -- especially on a risk-adjusted basis. Over the six and one-half years through mid-1992, it gained 70.9%, in contrast to 124.5%for the Wilshire 5000 -- but with substantially less risk." (page 318)
"Weinstein's mutual fund allocation advice in the stock market gained 238.9% on a pure timing basis, as compared to 432.7% for buying and holding. When this timing-only portfolio's risk is taken into account, it almost (but not quite) equals the market's return." (page 318)
For the period 1980 to 1992 his timing model ranked 12th out of the 15 newsletters evaluated; for 1985 to 1992, his newsletter was ranked 27th out of 27. (page 504)
There are more comparisons, but you get the idea. I'm not trying to make him look bad but I found it disconcerting that his performance seemed to be so weak. I'd love to hear his side of it but I've never been able to find anything from him.
Some possible explanations: 1) Hulbert's measure of performance is invalid; 2) Weinstein's ideas are sound but he doesn't have the skill to implement them; 3) His ideas are unsound.
Wayne
(There...my first post
)
"Over the twelve years through mid-1992, Weinstein's model stock portfolio had a gain of 48.5% compared to 432.7% for the Wilshire 5000." (page 317)
"[his mutual fund] has done better -- especially on a risk-adjusted basis. Over the six and one-half years through mid-1992, it gained 70.9%, in contrast to 124.5%for the Wilshire 5000 -- but with substantially less risk." (page 318)
"Weinstein's mutual fund allocation advice in the stock market gained 238.9% on a pure timing basis, as compared to 432.7% for buying and holding. When this timing-only portfolio's risk is taken into account, it almost (but not quite) equals the market's return." (page 318)
For the period 1980 to 1992 his timing model ranked 12th out of the 15 newsletters evaluated; for 1985 to 1992, his newsletter was ranked 27th out of 27. (page 504)
There are more comparisons, but you get the idea. I'm not trying to make him look bad but I found it disconcerting that his performance seemed to be so weak. I'd love to hear his side of it but I've never been able to find anything from him.
Some possible explanations: 1) Hulbert's measure of performance is invalid; 2) Weinstein's ideas are sound but he doesn't have the skill to implement them; 3) His ideas are unsound.
Wayne
(There...my first post
)that's a great book- very simple straight-forward approach that is still valid, although some might not using the 30MA as the benchmark MA. i've read it at least twice. what's not valid about:
1) buying a breakout on volume.
2) not buying, but shorting stocks that have rolled over and are in a phase III downtrend.
3) tracking stocks that are basing.
4) standing aside when stocks start getting choppy at the top and shorting when the breakdown on volume.
5) trailing stops
6) buying pullbacks to the MA in an uptrend.
7) cutting your losses!
8) ...
1) buying a breakout on volume.
2) not buying, but shorting stocks that have rolled over and are in a phase III downtrend.
3) tracking stocks that are basing.
4) standing aside when stocks start getting choppy at the top and shorting when the breakdown on volume.
5) trailing stops
6) buying pullbacks to the MA in an uptrend.
7) cutting your losses!
8) ...