Sunday Linkfest of Importance

Jul 22, 2007: 11:40 AM CST

This week was a very active week and I am glad the weekend is upon us. Take a little time out of your Sunday evening to study up on some of the posts from the blogosphere and learn some new insights.

I’ve always tried to avoid swing trading around earnings, but have studied various approaches to the “earnings conundrum.” Stockbee offers ten concise points that are worth consideration in the post Ten Things You Must Know About Trading Earnings.

Bill at the Vix and More Blog posted an excellent resource entitled “A Baker’s Dozen of Market Indicators. In the post, he lists indicators for the General Market, Market Breadth, Market Sentiment, and Sector Strength (among others).

Kevin at Kevin’s Market Blog posts a positive analysis of the overall market by revealing the relative positioning of “commercial” traders and also notes what happens when this group of informed traders is net long the market in his post “Is the Smart Money Long or Short Stocks Now?” Click to find out.

The Tyro Trader has a very interesting post attractively titled “Everything I Learned About Trading I Learned in the Kitchen.” It is an enjoyable post comparing entrepreneur restauranteurs with a dream to new ‘entrepreneur’ traders with a dream and notes unfortunately that the failure (or attrition) rate for both teeters near 75%. In addition, he lists seven major points that are helpful to keep you from failing – I absolutely recommend this post.

Dr. Steenbarger examined insights from professional money managers in the post “Market Moods: Risk Seeking and Risk Averse Money Managers.” I liked the quote, “… for [each] firm there is the Scylla of Risk and the Charybdis of performance.” This affects us as retail traders, but it is amplified for professional money managers. Dr. Brett also shows how we can gauge market sentiment/mood and offers three places to look.

Also check Dr. Brett’s post entitled “Cracks in the Market Foundation” for insights into what may be happening ‘under the market’s hood’ regarding market strength/weakness.

Paul Castro at Vestopia posted his results regarding the Equity Curve Simulator I recently highlighted regarding expectancy in his post A Neat Online Tool. He notes something that many new traders simply cannot believe: Although 25% of Mr. Castro’s positions are winners, his strategy has a positive expectancy and makes money over the long haul. Restated, although 3 out of 4 trades end in (small) losses, the overall system is very profitable. I enjoyed his summary statement, “I feel like I am a baseball player in the batter’s box. I equate the 3 out of every 4 losing trades to fouling off pitches”. How is this possible? Read the post for more insight.

If you have a link or post you would like to recommend, or enjoyed reading, please let me know.

1 Comment

One Response to “Sunday Linkfest of Importance”

  1. Pradeep Bonde Says:

    Thanks. I am glad you liked the post.