Choosing Stocks and Timing Buy and Sell Decisions: Trend-Based, Evidence-Driven Strategies That Work
What to do, how and when to do it, and why
Specific advice backed by modern statistical tests that identify consistently successful combinations of indicators
Techniques for identifying early weaknesses, maximizing gains, and protecting capital
By Charles D. Kirkpatrick II, the world’s most influential technical analyst
There’s only one way to successfully compete with Wall Street’s “big boys”: use algorithmic systems, just like they do. Fortunately, you can. Thanks to the wide availability of derivatives, cheap computing, and low-cost, high-speed trading platforms, you can run algorithmic systems that are proven statistically and can operate almost automatically.
In this book, world-renowned technical analysis expert Charles D. Kirkpatrick II presents these systems and the evidence that supports them. Building on exhaustive research, Kirkpatrick shows why relative strength systems deliver consistent profits. Next, he drills down to identify the optimal elements of such systems, including lookback periods, ranks/ratios for portfolio changes, minimum trading volumes, and techniques for limiting the impact of market declines.
Kirkpatrick’s final results are practical and robust. Based on easy-to-interpret ADX, forward line, and 3-bar reversal charts, they are easy enough for virtually any investor to use, with any size portfolio.
At its foundation, technical analysis involves recognizing and analyzing trends and identifying the best investment strategy to take advantage of them. Most traders and investors who look for trends do so by analyzing a long list of charts on a continuing basis. In Kirkpatrick's Investment and Trading Strategies, world-renowned technical analysis researcher Charles D. Kirkpatrick II presents tested, pinpoint approaches to stock investing that are far more effective and efficient.
Drawing on statistical testing of markets from 1990 to the present, Kirkpatrick identifies combinations of technical tests that have consistently delivered the best performance. Using them, he shows how to identify stocks that are now demonstrating the strongest relative and absolute strength. Next, he identifies specific trend following indicators most likely to identify the first signs of trend reversals--and, thus, the right time to sell.
Throughout, Kirkpatrick offers detailed, practical, and example-rich guidance for using these indicators, providing all the detail you need to implement an investment strategy that is both profitable and risk-averse.
Tested, trend-based indicators you can understand and rely
Choose the right stocks--and the right times to buy and sell them
Protect your capital with DMI, ADX, and other key technical
Discover your true risk of loss and systematically protect against it
Why Kirkpatrick’s relative strength system works so
Understand the statistics behind the system--in as much detail as you’d like
Using the system after you’ve implemented
Realistic examples and step-by-step instructions
Table of contents
- About This eBook
- Title Page
- Copyright Page
- Praise for Kirkpatrick’s Investment and Trading Strategies
- Dedication Page
- About the Author
- 1. Introduction
- 2. Investment Strategies: Backtesting
- 3. Initial Standard Optimizations
- 4. Market Timing and Walk-Forward Optimizing
- 5. Stock Selection Using Relative Strength
- 6. Trading Strategies
- 7. Directional Movement Index (DMI) and the ADX
- 8. Cycles and the Forward Line
- 9. Trading Models and Tests
- FT Press
- Title: Kirkpatrick’s Investment and Trading Strategies: Tools and Techniques for Profitable Trend Following
- Release date: July 2013
- Publisher(s): Pearson
- ISBN: 9780132597609
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