Isn't the whole issue academic (in the derogatory sense) since in the stock market human psychology favors perpetuating trends in the first place? Without such "annoyances" as fundamental values, supply and demand, and the rest of economics -- wouldn't many things just keep trending if left alone? Why does academia assume that the stock market can be analogous to coin flipping? If the market resembles anything in my book, it's just a long series of pyramid schemes that need to get deflated once in a while.
I just edit the end of the above thread : because they can't even if they knew it - and I know that they know but it's another subject - : "If market's organisers and economists officially admit true trend the pilars of finance (notably CAPM, APT methods of portfolio management that are used by fund managers) would be shakened so they can't : it would be like a casino telling all the players "hey this roulette at this table is biased"
If you see a trend in a pyramid scheme, and then the pyramid scheme collapses, did the trend ever really exist?
It can never be favorable since whatever strategy (martingale) you can find the Expectancy (prob * gain - prob * loss) will be always negative. That doesn't say that strategy doesn't count it counts ... once you are OBLIGED or absolutly want to play. So strategy in casino game is never for winning for sure it is rather to optimise the rest of chance. In Stock market the probability will depend also on knowledge since not everybody is equal like in casino but for those who use pure martingale strategy in stock market like in Casino the effect will be the same: there will statistically some who will win big and some who will lose big. You will only hear those who will win big generally and that will entertain the myth that pure martingale strategies works. If you don't have an edge it can only work by chance ( Chance is not to be rejected of course when it comes but stay humble then). If you have neither edge nor strategy (money management) you will not put all the chance on your side.
If you think that this guy has some special ability, it's an illusion since the MULTIPLE equity curves are drawn from a fair coin toss. This illusion has been discovered only in 20th century from mathematician Levy and called commonly "persistency of chance", more metaphorically "Fundamental Injustice Law of Nature" and more technically arc sinus law. This law is NOT AT ALL INTUITIVE as one would expect that the number of curves below and above zero somehow counterbalance each other. THAT'S WHY AN EQUITY CURVE ALONE DOESN'T ALLOW TO JUDGE A SYSTEM OR TRADER HAHA ! That's what snake oils sellers exploit.
Now, there is a worthwhile chart. Can you spot all the trends, Harry? And, where's Waldo? Is he in there?
Va jouer au bac au sable, mon petit (go and play in the sand my little boy) or try to make some more intelligent comment than usual : If you think that this guy has some special ability, it's an illusion since the MULTIPLE equity curves are drawn from a fair coin toss. This illusion has been discovered only in 20th century from mathematician Levy and called commonly "persistency of chance", more metaphorically "Fundamental Injustice Law of Nature" and more technically arc sinus law. This law is NOT AT ALL INTUITIVE as one would expect that the number of curves below and above zero somehow counterbalance each other. THAT'S WHY AN EQUITY CURVE ALONE DOESN'T ALLOW TO JUDGE A SYSTEM OR TRADER HAHA ! That's what snake oils sellers exploit.