by The Investor
on October 24, 2009
My regular Saturday comment followed by this week’s blog and financial site links.
I admit there are worrying signs in the market. I don’t mean how the main indexes seem to have stalled — it’s always very hard to tell signals from noise, and anyway Australian academics just proved that technical analysis doesn’t work:
Technical analysis is not consistently profitable in the 49 countries that comprise the Morgan Stanley Capital Index once data snooping bias is accounted for.
There is some evidence that technical trading rules perform better in emerging markets than developed markets, which is consistent with the finding of previous studies that these markets are less efficient, but this result is not strong.
While we cannot rule out the possibility that technical analysis compliments other market timing techniques or that trading rules we do not test are profitable, we do show that over 5,000 trading rules do not add value beyond what may be expected by chance when used in isolation.
No, what’s slightly concerned me are reports that traders are making out like bandits on the City desks, oblivious to risk.
[continue reading…]
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by The Investor
on October 21, 2009
“Never in the field of financial endeavor has so much been owed by so few to so many.”
— Mervyn King, Governor of the bank of England
I have said before I’m too lazy busy to feel able to update you about every trade I make in the active portion of my share portfolio.
But I don’t mind saying that I’ve now sold all my Lloyds shares.
While I didn’t catch the highs — and have already explained how my heady trading profits were pretty illusory — the quick gains I did bank were too tempting in light of the ongoing risks of holding Lloyds.
Lloyds shares still look cheap – and sitting through the many risks is what investors will likely be rewarded for – but with even the Bank of England governor Mervyn King last night stating banks must be broken up, the uncertainty just keeps mounting.
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by The Investor
on October 20, 2009
A few people emailed to ask how I calculated the yield on the RBS Royal Bond.
Hey presto! This post will tell you everything you need to know about calculating bond yields, whether for government or corporate bonds.
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by The Investor
on October 17, 2009
My weekly commentary followed by this week’s links to blogs and financial articles.
I only wrote two posts for Monevator this week, instead of my usual three.
I’m currently working long hours, you see, and that’s devoured most of my free time.
But never mind, because according to the specious logic of self-justifying bankers, I must be entitled to a six-figure bonus check as a result of my labours.
After all, “We work hard!” is one of the cries that the denizens of the financial goldfish bowl use to justify their inflated incomes.
As if nobody else works hard.
[continue reading…]
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