Posts filed under “Psychology”

Apprenticed Investor: Tracking Elephants, Part II

Tscm_1The latest "Apprentice Investor" column is up at Its called  Tracking Elephants, Part II.  The subhead is "The non Technicians Guide to Technical Analysis," and that’s a pretty good description. Charts have something of value to add to even pure fundamentalists. In a way, its the opposite of the Wisdom of Crowds.

Starting this week, I’ll also be adding a podcast, giving some additonal background and flavor to each column: 

Of course, the ubiquitous excerpt:

"Here’s an interesting question: If you could look at one and only one source before buying your next stock, which would you choose: a fundamental analyst’s report (with no charts in it), or the chart
of your choosing?  While I like having access to both, I cannot ever
imagine buying something without first looking at the chart.

And so we wade into the ongoing battle between technical and
fundamental analysts. Frankly, it’s one of the sillier debates in
investing. But I’ve heard so many bad arguments and misleading theories
about technical analysis that I decided to weigh in."

Before we wade too deeply into the controversy, ask yourself: "Why
do I need to choose?" Why wouldn’t you use any tool that can be shown
to have value? You wouldn’t build a house using only a hammer, but no
drills or saws. Why limit yourself away from a tool that can assist you
as an investor?

Here are some charts illustrating these points:

Apple Breaks its Uptrend
click for larger graph


GM Breaks Support
click for larger graph


eBay Risk/Reward entry points
click for larger graph


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Category: Investing, Podcast, Psychology, Technical Analysis

Stop Blaming Oil!

Category: Commodities, Investing, Markets, Psychology

Weekend Linkfest

Category: Economy, Investing, Psychology, Real Estate

New Column up at Real Money (06/21/05)

Category: Commodities, Investing, Psychology

Confusing Sentiment Data

Category: Politics, Psychology, War/Defense

Will Rallying Oil Set a Bear Trap?

Category: Commodities, Markets, Psychology, Trading

Category: Psychology, Real Estate

Apprenticed Investor: Lose the News

Category: Financial Press, Investing, Markets, Psychology

The Prediction Markets Chalk Another One Up!

Category: Markets, Psychology

Why Investors Fail

Nice piece by BMO Nesbitt on why investors fail: “Individuals have historically underperformed the markets, earning just 2.6% vs. the S&P 500 gain of 12.2% between 1984 and the end of 2002*. Research in the U.S. has shown that this dramatic underperformance comes as a direct result of client behaviour, or more specifically, the attempt…Read More

Category: Investing, Psychology