What Do Hedge Funds Think of Technical Analysis?

[longandshort]

Gotcha....

Im going to water it down to strictly buying/selling stocks based on charts only and possibly fundamental metrics..Stops and money management included..

Im going to go out on a limb and say I think you can generate excess returns by looking at MA and RS,though I have to see how much market capitalization came into play...If I remove the small cap effect,maybe I am wrong

Market and factor neutral?

Willing to take the other side of that bet.

 

[longandshort]

That's what speculators do. Of course you have to throw in some money management and risk control.

If you pay to bet on a coin flip you just lose money, regardless of money management or risk control.

 

[Laissez Faire]

What’s your basis for why you think someone using a chart alone would outperform others?

The basis would be an experienced trader and the fact that price is patterned and not moving randomly. Think years of study, observation and practice.

 

[Frederick Foresight]

If you pay to bet on a coin flip you just lose money, regardless of money management or risk control.

Your point?

As an aside, George Soros was known to construct fairly elaborate macro scenarios upon which he would then take a position. If the price action did not then support his thesis he was known to then either quickly exit or even reverse his position. Kinda tells you what's key, don't it?

 

[taowave]

Sadly,and mercifully at the same time,thats as quanty as I get

Market and factor neutral?

Willing to take the other side of that bet.

i agree but I wouldn’t even consider those quanty.

 

[longandshort]

The basis would be an experienced trader and the fact that price is patterned and not moving randomly. Think years of study, observation and practice.

@taowave you see what I’m dealing with

 

[taowave]

I think you may be missing out on a key ingredient

LEVERAGE

I went thru the numbers real quick,and if you are going to play the "get out quickly" game,I think you need to lever up at 1.4x or more

Your point?

As an aside, George Soros was known to construct fairly elaborate macro scenarios upon which he would then take a position. If the price action did not then support his thesis he was known to either quickly exit or even reverse his position.

 

[longandshort]

Your point?

As an aside, George Soros was known to construct fairly elaborate macro scenarios upon which he would then take a position. If the price action did not then support his thesis he was known to either quickly exit or even reverse his position. Kinda tells you what's key, don't it?

Ah you’re soooo close! Yes — gotta build a thesis to make a bet! Have to think you’re either getting a free coin flip, or that the coin is skewed to one outcome. Then make the bet. If you’re right you make money and if you’re wrong you lose money.

Soros was not building elaborate macro scenarios using price action on the chart. Soros built those macro scenarios with macro data and analysis and from there extrapolated to the chart.

 

[Frederick Foresight]

I think you may be missing out on a key ingredient

LEVERAGE

I went thru the numbers real quick,and if you are going to play the "get out quickly" game,I think you need to lever up at 1.4x or more

I have no doubt that leverage was at play, but I don't see how that changes the story.

 

[longandshort]

@taowave i can use TSIG <go> on bbg to run a backtest of a ma and rs strategy. Gimme the parameters and I’ll run it.