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Old 12-16-2005, 04:58 PM
Officer Farva Officer Farva is offline
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Join Date: Aug 2004
Location: Palo Alto CA
Posts: 149
Default Re: The Trend

Here is the best piece of knowledge I have about markets and trends:

use as much relative information as possible, and value them all roughly equally.

for me, this means using a large set of quant factors (rsi, macd, ad, ma cross, 2nd derivatives, mean reversion, unit root tests, etc)

I then take some sort of fundamental idea and dump it in to this framework, and do it the same way everytime.

The key here is that although noone uses all of these factors everytime, there is always someone using each of these factors. So if you can get them to roughly be aligned, chances are there are more people in alignment with you. Combine that with a decent idea producer, and you have yourself a market beating trend model. I learned that first hand from one of the top macro managers in the world.
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