Re: Stock scream room
Posted: Tue Sep 10, 2019 8:36 pm
Permanent Portfolio Forum
https://www.gyroscopicinvesting.com/forum/
https://www.gyroscopicinvesting.com/forum/viewtopic.php?t=6365
That’s how I felt about all the gold trade talk a year or two ago. I gave up.
He has a chapter on the technical indicators he believed weren't mumbo jumbo and actually used extensively and successfully in his younger speculating years. He didn't believe all technical stuff was "mumbo jumbo". I highly encourage you to re-read "When the best laid plans..." again. 90% of the posts in this forum are about future speculation. There's simply no way to get rid of this, unless you stop going to investing forums. The gold scream room got to me last year as well, but that wasn't constructive. It was just one disgruntled person coming into the room a couple times a week basically saying "gold sucks, the PP sucks, my 70/30 is great, I have 6 million dollars and you all are poor fools" over and over again.dualstow wrote: ↑Wed Sep 11, 2019 9:18 amThat’s how I felt about all the gold trade talk a year or two ago. I gave up.
I wouldn’t care except that it must be strange for someone new to the forum who hasn’t read any of Harry’s books to see all the fast-paced, momentumy, technical chatter. I mean, he’s got a chapter on how how technical stuff is mumbo jumbo.
FWIW, I agree with most of what Harry said on technicals, especially considering the demographic he was writing for. But no, rebalance bands are not a replacement for support and resistance. Both are used for two completely separate ends. I do agree that in the PP people are best sticking to rebalance bands. But in the VP any number of strategies are fair game. Support and resistance aka technical strategies are great. Momentum strategies are great. Buy and hold strategies are great. Quant strategies are great. I think these all are valuable. It really depends on the person and what their constitution and goals are. Personally, I know in my constitution I need a VP so I feel that I have some control. Having the VP to chase gains is a psychological tool that helps me to hold my PP and stick to the rules without modification.
I don’t recall anyone saying you couldn’t talk about it. drumminj said all that technical talk really belonged in the vp section. I was saying I felt the same way about previous talk in the gold section - someone was bragging about buying and selling all the time, which just doesn’t have anything to do with the permanent porftolio, but would be fine in the vp section.pmward wrote: ↑Wed Sep 11, 2019 9:30 am On this forum we have ...
I think that these views are all valuable and constructive. I see no reason for anyone to poo poo the views that they don't subscribe to, especially since Harry was adamant that most people should have a VP. I also believe that due to normal human psychology most humans are better off having a VP. If all we allowed in here were discussions directly about the PP, there would be no discussion, and nobody would be here.
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Dr Evil, pinky in corner of mouth
I totally agree that the average person shouldn't dabble in technical analysis, as the amount of knowledge you need to gain is very large. The quote you posted from Harry earlier is true, that most people want that one technical indicator that is magic, and it simply doesn't exist. In technical analysis you have to use multiple indicators, and at any given time you're always going to have mixed signals. It's incredibly rare to have the stars align and see a perfect setup with no contrary indicators. These perfect setups tend to happen more on the longer term charts than the short term charts, like the recent gold breakout. I was pounding the table here for gold for months before it finally broke out. These longer term setups are indeed harder to time though, it was like "ok, be patient, gold is going to breakout like wildfire, but it could happen anytime between now and 2 years from now" haha. Everyone here on this forum had given up on it, and I kept pounding the table and saying it was the most beautiful long term setup I've ever seen. But in the short to medium term, there's almost always some bull and bearish indications on any chart, and if one is going to bet one does have to use some discretion and intuition here, along with the most important piece which is a proper risk management strategy. With a proper risk management strategy you can make more losing calls than winning calls, yet on the whole still make bank. Risk management strategies in trading are very similar to those employed by professional gamblers.dualstow wrote: ↑Wed Sep 11, 2019 10:07 am If I could criticize Harry a little bit, I wish that he had stated clearly that the average investor just doesn't have the aptitude to benefit from technical analysis. Well, maybe that was not his opinion. Perhaps you're smart enough to do it, pm. You obviously have a background in it. But, only a few analysts can be..head and shoulders above the rest?Code: Select all
Dr Evil, pinky in corner of mouth
Your views are very limited, subjective, and uneducated. You do not have the knowledge or experience on technical analysis to pass any kind of judgment. It's ok if you say "it's not for me, and I'm not interested". But it's not ok to insult something you have absolutely no real knowledge of. That being said, I don't feel like getting into yet another debate on technical analysis. I've had too many of those already on different forums over the years, and just don't have the patience to go through it again. Just like any other strategy: Those that get it, get it. Those that don't, don't. I have no interest in trying to convert those in the "don't" subset into the subset of those that "get it". However, I will point out that having a closed mind on any subject is nothing more than a self imposed limitation.boglerdude wrote: ↑Wed Sep 11, 2019 11:35 pm Technical analysis is sperglords jerking off. Pattern seeking feels good. Fine. Its a hobby, and "I need a VP so I feel that I have some control" is a legit reason. Lets not lose perspective tho, if you want to "outsmart" the markets (composed of players like Jim Simons et al): front run or insider trade.
Edit1: Well, money does seem to slosh around between asset classes, so there might be something to be said for "market timing" by buying something beat up. Still, its gambling and shouldnt be thought of as more clever than studying real science
Another thing... people who hold the 1/4 of their assets in the S&P 500 think that it's somehow pure as untrammeled snow, and free from all of the "jerking off" of technical analysis, well, that's not true either. Stock inclusion into the S&P 500 is decided by, yes, a committee. "O the humanity!"pmward wrote: ↑Thu Sep 12, 2019 10:56 am Your views are very limited, subjective, and uneducated. You do not have the knowledge or experience on technical analysis to pass any kind of judgment. It's ok if you say "it's not for me, and I'm not interested". But it's not ok to insult something you have absolutely no real knowledge of. That being said, I don't feel like getting into yet another debate on technical analysis. I've had too many of those already on different forums over the years, and just don't have the patience to go through it again. Just like any other strategy: Those that get it, get it. Those that don't, don't. I have no interest in trying to convert those in the "don't" subset into the subset of those that "get it". However, I will point out that having a closed mind on any subject is nothing more than a self imposed limitation.
That is very true, even behind the committee, all indices are themselves are by nature quant based. It's a very simplistic quant strategy, but a quant strategy none the less.ochotona wrote: ↑Thu Sep 12, 2019 3:02 pmAnother thing... people who hold the 1/4 of their assets in the S&P 500 think that it's somehow pure as untrammeled snow, and free from all of the "jerking off" of technical analysis, well, that's not true either. Stock inclusion into the S&P 500 is decided by, yes, a committee. "O the humanity!"pmward wrote: ↑Thu Sep 12, 2019 10:56 am Your views are very limited, subjective, and uneducated. You do not have the knowledge or experience on technical analysis to pass any kind of judgment. It's ok if you say "it's not for me, and I'm not interested". But it's not ok to insult something you have absolutely no real knowledge of. That being said, I don't feel like getting into yet another debate on technical analysis. I've had too many of those already on different forums over the years, and just don't have the patience to go through it again. Just like any other strategy: Those that get it, get it. Those that don't, don't. I have no interest in trying to convert those in the "don't" subset into the subset of those that "get it". However, I will point out that having a closed mind on any subject is nothing more than a self imposed limitation.
There is a lot of complexity under the covers with all of these securities, and it's OK if you don't want to think about it minute by minute, but just because you don't look, don't think that you don't silently assent to participate, because you do, and don't make fun of people who think about the complexity that you choose to ignore.
There is still trading in both every year... Bond funds always have to cycle their bonds, and the exact bonds and proportions they buy and sell are all driven from quant algorithms. VTSAX also has to buy and sell stock as people buy and sell shares, and the proportions they buy and sell in are driven from quant algorithms. VTSAX doesn't literally buy every stock in the market... there are plenty they leave out, and the stocks chosen and left out are done using quantitative algorithms. The ordering of stocks in VTSAX (market cap weight) is a quant algorithm. Any segmented index fund like a large cap, small cap, mid cap, value, growth, etc do all the above as well as select the securities using quant algorithms. You cannot have an index without quantitative analysis. Indexing IS quantitative. There is no separating the two.
No it is not misleading. What is misleading is trying to define the words "quantitative analysis" in a short sighted and overly tight manner to only mean one very specific form of quantitative analysis, and to choose to ignore all others.
VTSAX doesn't literally buy every stock in the market... there are plenty they leave out, and the stocks chosen and left out are done using quantitative algorithms.
For the sake of beginning investors out there, not for my sake, please give us all an example of investing that isn’t quant. If you can’t, does the term having have any meaning anymore?Moreover, how did you choose the PP? Quantitative analysis. How did you choose buy and hold strategy? More quantitative analysis.
You're investing when:
You hold a long-term position in the stock market with no attempt to time your investments or to determine which sectors of the market will perform best.
...
That’s the point.You’re speculating when:
...
You use fundamental analysis, technical analysis, cyclical analysis, or any other form of analysis or system to tell you when to buy and sell.
It's weird reading those quotes. Because really, if you're buying shares of companies that you don't even know about, on the hope that they'll be productive over the long run, but you don't know if they're actually shitty companies or profitable... isn't that the real speculation? Consider the definition of speculative (engaged in, expressing, or based on conjecture rather than knowledge) and conjecture (an opinion or conclusion formed on the basis of incomplete information).dualstow wrote: ↑Fri Sep 13, 2019 6:14 am Harry, Rule #3 in Fail-Safe:
You're investing when:
You hold a long-term position in the stock market with no attempt to time your investments or to determine which sectors of the market will perform best.
...You’re speculating when:
...
You use fundamental analysis, technical analysis, cyclical analysis, or any other form of analysis or system to tell you when to buy and sell.
Yes that is my point exactly, and why I've been wondering why you have taken so much offense simply to me stating that indexing, the PP, and buy and hold are quantitative strategies. This was the only point I made, that you started pushing back on. There is no way those things can be classified as not being quantitative in nature. It makes no sense why you would deny this. Now within quantitative strategies, you may have some you favor and some you don't. There are certainly some that are better for beginners, and some that are not. There are certainly some that are better for the average Joe, and some that are better for professionals. There are certainly some that will fit a certain individual better than others. I have said nothing regarding any of those subjective points, I think you're arguing with things you've assumed not things I've said. I stated above that I have no interest in trying to convert anyone to any particular style. But if anyone has questions and wants to know about the technical side of things, which I am very experienced, I am more than happy to discuss. You can choose to be entertained by my gibbering about technicals, you can choose to ignore it, but there is no reason to be offended by it. In general, I don't believe having a closed mind on any subject is a good thing. One should always remain open. I don't bash any investment style personally, because in the right hands they all work.dualstow wrote: ↑Fri Sep 13, 2019 6:06 amVTSAX doesn't literally buy every stock in the market... there are plenty they leave out, and the stocks chosen and left out are done using quantitative algorithms.For the sake of beginning investors out there, not for my sake, please give us all an example of investing that isn’t quant. If you can’t, does the term having have any meaning anymore?Moreover, how did you choose the PP? Quantitative analysis. How did you choose buy and hold strategy? More quantitative analysis.
Or are you just muddying the waters for people who should really learn about indexing and lazy portfolios first, and all for the sake of being pedantic?