University professors are sometimes asked by their students, "If you're so smart, why aren't you rich?" The question usually rankles professors, who think of themselves as passing up worldly riches to engage in such an obviously socially useful occupation as teaching. The same question might more appropriately be addressed to technicians. For, after all, the whole point of technical analysis is to make money, and one would reasonably expect that those who preach it should practice it successfully in their own investments. On close examination, technicians are often seen with holes in their shoes and frayed shirt collars. I, personally, have never known a successful technician, but I have seen the wrecks of several unsuccessful ones. (This is, of course, in terms of following their own technical advice. Commissions from urging customers to act on their recommendations are very lucrative.) Curiously, however, the broke technician is never apologetic. If you commit the social error of asking him why he is broke, he will tell you quite ingenuously that he made the all-too-human error of not believing his own charts. To my great embarrassment, I once choked conspicuously at the dinner table of a chartist friend of mine when he made such a comment. I have since made it a rule never to eat with a chartist. It's bad for digestion. Burton G. Malkiel A random walk down Wall Street
a random walk down wall street = too lazy or too stupid to figure the game out (or enough of it to make consistent monies)
Burton is known to fabricate stories to sell his thoughts. Think about it, why would he be hanging out on his own personal time with dinner pals that he has stereotyped as being broke, shoes with holes along with frayed shirt collars. By the way, I've never asked anyone of my professors at college why they aren't rich nor have any of my friends or classmates. I always assumed they made a good living at teaching and it was something they enjoyed doing especially after all that education (undergraduate and post-graduate) of many years (8 - 15 years worth) just to be a college professor. Seriously, anyone that has ever gone to college knows that most professors actually still work in their profession via research, consultation and application field work. Therefore, it's safe to assume he has fabricated other things and I'm willing to bet his dinner pals payed for his meals. Mark
Regardless of Burton, its very very true MOST TA practioners are dead broke. While arbers and tapereaders seem to be doing much better than the chart artists. In adddition, why isnt TA taught much in prop trading courses like Bright? every think cause it does not work? Facts speak for themselves
Hey, nice to see you back again . . . and again . . . and again . . . and again . . . and again . . . and again . . . and again . . . 95% of ALL traders fail. Some traders use Technical Analysis exclusively. Some traders use Fundamental Analysis exclusively. Some traders use a mix of both. According to the MTA the mix is pretty evenly spread for stocks and tipped a little more toward TA for futures, commodities and options, yet 95% fail. Seems the common factor here is 95% of traders can't use anything to be consistently profitable not just TA. Ah regarding Bright . . . now being the good firm they are, if they were such a beacon of light in the industry then ALL of their traders would consistently fall into the 5% category and every trader in the world would be breaking Bright's doors down to have them train them. Sorry to say that neither one of those scenarios are the case. Yes, the FACTS do speak for themselves.
Bright traders use charts and so do many other prop firm traders, institutional traders et cetera. :eek: However, I do agree with you that arbers do better than those that aren't arbers. Yet, the few arbers I know do use charts too regardless if the charts are important or not. Fact remain, they have charts up on their monitor screens. could it just be screensavers? Yep, I know the debate, just because someone uses charts doesn't imply there trade decisions is based upon what they see on their charts. If that's the case...get rid of the charts and never look at another one again (seriously). Here's some facts I've seen here at ET...carefully review the post history of many of those here at ET that speaks out against TA and you'll see they've posted charts themselves to explain some of their trades or they've discussed in agreement with the chart analysis of another ET member or used linear charts of something they've downloaded or linked to that shows months or years of economic data as they use that info to explain the reasons behind their trade positions. Why not just show the actual price data without the charts? I said in another thread...recently I went to visit a friend at his trading office (institutional firm) and he had always stated he doesn't use TA. Yet, on his two bloomberg screens were charts of yields and treasury futures. It's so confusing. Mark
Random markets are a myth. EMH is a myth, and I'm glad it's still taught to finance students, as they'll eventually prove to be cannon fodder for those who know better. Malkiel pulled an Al Gore, and cashed in on bullshit idea that has been horrendously disproven. SPY Equity KAOS Go : An ongoing bitchslap to EMH theory, delivered in real-time...SLAP!!
I would suggest that you all try talking to fund managers at hedge funds. Ask them how they support stock going into the end of the reporting quarter and what techiniques they use. Ask them how they gun the leaders to make their numbers look even better. Ask them if they support stock at sell offs and where they buyer more. Ask them how the go about maintenance trading in the summer time. And why this no longer applies as much. Ask an NYSE floor broker what happens when there is more than one buyer around the specialist. Ask if there were step up buyers. Ask about how the specialist would split the order up into double prints. Ask if they ever got orders to by 10,000 at every round figure. Ask the if the specialists liked to race to the round figures to do business because there would be larger orders there. Only true fools say that technical analysis does not work. It definitely works some of the time. You have to know when.