The Hedge Fund Edge - Wiley

[ Pobierz całość w formacie PDF ]
//-->Wiley Trading AdvantageTrading without Fear /Richard W. Arms, Jr.Neural Network: Time Series Forecasting of Financial Markets IE. MichaelAzoffOption Market Making /Alan J. BairdMoney Management Strategies for Futures Traders /Nauzer J. BalsaraGenetic Algorithms and Investment Strategies /Richard BauerSeasonality: Systems, Strategies, and Signals /Jake BernsteinThe Hedge Fund Edge /Mark BoucherManaged futures: An Investor's Guide /Beverly ChandlerBeyond Technical Analysis /Tushar ChandeThe New Technical Trader /Tushar Chande and Stanley S. KrollTrading on the Edge IGuido J. DeboeckTrading the Plan IRobert DeelThe New Science of Technical Analysis /Thomas R. DeMarkPoint and Figure Charting /Thomas J. DorseyTrading for a Living /Dr. Alexander ElderStudy Guide for Trading foraLiving /Dr. Alexander ElderThe Day Trader's Manual /William F. EngThe Options Course: High Profit £f Low Stress Trading Methods IGeorge A. FontanillsThe Options Course Workbook IGeorge A. FontanillsTrading 101 /Sunny J. HarrisTrading 102 ISunny J. HarrisAnalyzing and Forecasting Futures Prices /Anthony F. HerbstTechnical Analysis of the Options Markets /Richard HextonPattern, Price & Time: Using Gann Theory in Trading Systems /James A. HyerczykProfits from Natural Resources: How to Make Big Money Investing in Metals, Food, andEnergy /Roland A. JansenNewCommodity Trading Systems & Methods /Perry KaufmanUnderstanding Options /Robert KolbThe Intuitive Trader /Robert KoppelMcMillan on Options ILawrence G. McMillanTrading on Expectations IBrendan MoynihanIntermarket Technical Analysis IJohn J. MurphyForecasting Financial Markets, 3rd Edition /Mark J. Powers and Mark G. CastelinoNeural Networks in the Capital Markets IPaul RefenesCybernetic Trading Strategies /Murray A. Ruggiero, Jr.The Option Advisor: Wealth-Building Techniques Using Equity and Index Options /Bernie G. SchaefferGaming the Market /Ronald B. SheltonOption Strategies, 2nd Edition ICourtney SmithTrader Vie II: Principles of Professional Speculation IVictor SperandeoCampaign Trading /John SweeneyThe Trader's Tax Survival Guide, Revised /Ted TesserThe Mathematics of Money Management /Ralph VincePortfolio Management Formulas /Ralph VinceThe New Money Management: A Framework for Asset Allocation /Ralph VinceTrading Applications of Japanese Candlestick Charting IGary Wagner and Brad MathenyTrading Chaos: Applying Expert Techniques to Maximize Your Profits /Bill WilliamsNew Trading Dimensions: How to Profit from Chaos in Stocks, Bonds, and Commodities /Bill WilliamsNew YorkTHEHEDGE FUNDEDGEMAXIMUM PROFIT/MINIMUM RISKGLOBAL TREND TRADING STRATEGIESMark BoucherJOHN WILEY & SONS, INCChichester •Weinheim•Brisbane •Singapore •TorontoAcknowledgmentsThis book is printed on acid-free paper. ®Copyright © 1999 by Mark Boucher. All rightsreserved.Published by John Wiley & Sons, Inc.Published simultaneously in Canada.No part of this publication may be reproduced, stored in a retrieval system or trans-mitted in any form or by any means, electronic, mechanical, photocopying, record-ing, scanning or otherwise, except as permitted under Section 107 or 108 of the 1976United States Copyright Act, without either the prior written permission of the Pub-lisher, or authorization through payment of the appropriate per-copy fee to the Copy-right Clearance Center, 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax(978) 750-4744. Requests to the Publisher for permission should be addressed to thePermissions Department, John Wiley & Sons, Inc., 605 Third Avenue, New York, NY10158-0012, (212) 850-6011, fax (212) 850-6008, E-Mail: PERMREQ ©WILEY.COM.This publication is designed to provide accurate and authoritative information inregard to the subject matter covered. It is sold with the understanding that the pub-lisher is not engaged in rendering professional services. If professional advice orother expert assistance is required, the services of a competent professional personshould be sought.Library of Congress Cataloging-in-Publication Data:Boucher, Mark, 1962-The hedge fund edge : maximum profit/minimum risk globaltrendtrading strategies / Mark Boucher.p.cm. — (Wiley trading advantage)Includes index.ISBN 0-471-18538-8 (alk. paper)1. Hedge funds.I. Title. II. Series.HG4530.B68 1998332.64'5—dc2198-18230Printed in the United States of America.10 9 8 7 6 5 4 3 2 1Two broad groups of people deserve recognition and thanks forthe making of this book and for the events in my life that have ledup to it. The first people are what I term "the wind beneath mywings." These are the people who directly helped me in ways thatmade this book possible. The second group is what I term "theshoulders of greatness on which I stand." These are people whosework indirectly has been of enormous benefit and help to me notonly in putting this work together, but also in developing the con-cepts described in many of the chapters.Among those who have been the wind beneath my wings, Iwant to thank my parents, particularly my mother, who through-out my life has been willing to sacrifice anything to help me toachieve my dreams. I want to thank my significant other, AnitaEllis, without whose consistent help and support none of thiswould have been possible. I am grateful to my coworkers for alltheir hard work and effort. Thank you Larry Connors and othersfor proofreading and offering moral support. I also thank my firstpartners in the hedge fund business, Tony Pilaro and Paul Sutin,whose faith and support led me into this industry. And I want es-pecially to thank Tom Johnson, my partner and friend, whose re-search, faith, fascination, and support made this possible.This book is greatly enhanced by the previous efforts of oth-ers who act as the shoulders of greatness on which this effortviACKNOWLEDGMENTSstands. First and foremost, I must acknowledge with gratitudethe contribution of Mr. "X," a great European money manager.He asked to remain anonymous, but near the end of his life, heshared with me his knowledge and system for financial success.Mr. X, your work will indeed live on and not just with me.Next I thank Marty Zweig and Dan Sullivan for their work onavoiding negative periods in U.S. markets, which provided amodel of what to strive for, both internationally and across otherasset classes. Also, thanks Marty, for all those wonderful correla-tion studies you filled your newsletter with each month fordecades—I saved them all and sought to apply my own reworkingof them to our master models.William O'Neil has done tremendous work on stock selectioncriteria, emphasizing ways to find the top-performing stocks ineach market, and Frank Cappiello has done pioneering work onthe importance of institutional discovery in the odyssey of astock's rise from obscurity to prominence. Meanwhile, NelsonFreeburg has applied a never-ending, incredible stream of timingsystems to a whole host of asset classes providing me with manyinsights. Also, I am tremendously indebted to all the people atBank Credit Analyst for their rigorous work and insight into theliquidity cycle across most tradable markets on the globe.My heartfelt thanks go to Ludwig von Mises, Ayn Rand, andMurry Rothbard for their selfless preservation of Austrian eco-nomics, the ideals of capitalism, and truth. I am grateful for thework of Paul Pilser for putting economic myth in its place andbringing forth the theory of alchemy. I want to acknowledgeStanley Kroll for his work on money management and JaySchabacker for his brilliant melding of the liquidity cycle andmutual fund selection.Finally, I thank Tony Robbins for reteaching me how tochange and grow and for exposing me to some of the ideas onwhich this work is based. If there is anyone out there who has notyet drunk of the knowledge of any of the great innovators I haveacknowledged here, let me encourage you to partake immediatelyfor your own enrichment.M.B.ContentsIntroduction12The Importance of RiskHow It All StartedHow to Recognize a Market MasterUnderstanding Is Key to SuccessOverview of the Approach in This Book1 The Risk of Traditional Investment Approaches569916The Effects of a Long-Term Bull MarketLong-Term Returns in EquitiesProtection against Bear MarketsBlue Chip StocksInvestment CriteriaHigh Returns and High Consistency—The TradeoffSummary2 Liquidity—The Pump That Artificially PrimesInvestment Flows1619262830354143Understanding the Austrian Interpretation ofthe Liquidity CycleThe Liquidity Cycle Illustrated with anIsland Economy4548viiiCONTENTSCONTENTSixThe Liquidity Cycle in ModernEconomiesTiming the Liquidity CycleUnderstanding EconomicGaugesImplications for U.S. MarketsSummary3 Index Valuation Gauges—Do Not Ignore thePrice You Pay516289100106111Using Index Valuation GaugesLimitations of Index Valuation AnalysisUsing Gauges for Mutual FundsValuation Gauges for International MarketsSummary111115116117122Disastrous Social ProgramsMinimum Wage PoliciesEconomic Freedom IndexWhen Investing, Look for Countries withLow Impediments to GrowthProfiting from Understanding DistortionsSome U.S. DistortionsEvaluating Government/Media HypeSecular Themes and TrendsExamples of Secular Themes and TrendsSummary1982022042062072092202272302394 Macro Technical Tools—Making Sure the TideIs Moving in the Right DirectionThe Argument for Technical AnalysisTaking a Wider ViewUsing Technical Analysis to Confirm TrendsReading the Message of the MarketsOverview of Technical AnalysisAnswering Criticism of Technical ToolsSummary5 Containing Risk—Sound Strategy and MoneyManagement Methods and the Principles ofCharacter Necessary to Achieve ThemMoney Management RulesPrinciples of Character1241251281301321341461507 Equity Selection Criteria Long and Short—How Profits Are MagnifiedMutual Funds.Individual Stock SelectionIdentifying Meteors and Fixed StarsEquity FuelMeasuring Price against GrowthModern Portfolio Theory MethodsStock Trading MethodSummary8 Other Asset Classes and Models to Exploit ThemOutperformance and Asset AllocationBuilding a PortfolioExploring Asset ClassesSummary240241245248261265270. 2732851511521612872872932943273293296 The Essence of Consistent Profits—UnderstandingAustrian AlchemyAlchemy versus EconomicsThe Long-Run Growth ParadigmNegative Tax Policies1661681741801909 Asset Allocation Models and GlobalRelativeStrengthAnalysis—Constructing a PortfolioUsing Asset Allocation ModelsGlobal Relative Strength: Radar Screen forFlexible Asset AllocationSummary336343xCONTENTSAppendix A: Strategies for Short-Term TradersTrading Runaway Moves345347Appendix B: Recommended Books, Services,Data Sources, and LettersLetters and ServicesData Services and SoftwareBooksFree Report355355358359360IntroductionAppendix C: Master Spreadsheet ofSystems PerformanceIndex362365This book is written for every investor or trader—large or small—who wants a methodology to consistently profit from the marketswithout incurring huge risks.In this era of exploding U.S. and global stock markets, manyinvestors are focusing most of their attention on returns, not onrisk. I can safely say that the methodologies advocated in thisbook offer highly pleasing potential returns. Our newsletter toclients has shown average annual returns of over 32 percent peryear since 1992, without a losing year and, more significantly,without a drawdown of over 10 percent (this has more than dou-bled the total return of the Standard & Poor's 500 [S&P] overthis period). During this same period, the funds I have con-sulted for have done even better in terms of both risk and re-turn, with real money, investing millions of dollars globally.And in researching the concepts on which these methodologiesare based, my colleagues and I have gone back to the early 1900sto verify their rigor. Thus while I am confident that the method-ologies described here can enable you to pull consistently largeprofits from the markets, I also hope that the book sharpensyour focus on two equally important factors of investment—riskand market understanding. [ Pobierz całość w formacie PDF ]

zanotowane.pl

doc.pisz.pl

pdf.pisz.pl

shinnobi.opx.pl