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Hi Pal,
I understand your point but the concept of efficiency, in the weak form,
in financial markets is intended in another sense. It means that it's
not possible to extract information (make a rule) from past prices that
allows to make extra profit. If there were, the nature of the markets
(competition) would clear it out very fast.
This would make any positive backtesting result (against a benchmark and
adjusted for the risk) a case of curve fitting.
But the fact that both logically and empirically (with reserves) it
seems acceptable doesn't mean it's true. So I would have liked to know
if systematic traders, like Fred, were consistently satisfied of their
approach.
Pal Anand wrote
>Markets are efficient, but prices are not. Prices move wherever the
>markets lead them to in response to supply and demand. Prices tend to
>equalize supply and demand, in order to maintain the markets
>efficiency, ie., a free market's. But it does take time to maintain a
>markets efficiency. During this time, a seemingly random movement of
>the prices is a tug of war between bulls and bears responding to
>supply and demand.
>
>A market that is not free is not efficient because the prices are
>artificially controlled by a state monopoly (with no regard to profits
>and losses except the alledged public good) and not by the competition
>created by free market. In a fully free ("laisez-faire") market,
>monopolies cannot exist but for a brief duration in time before other
>producers enter the market and depress prices...
>
>rgds, Pal
>--- In amibroker@xxxxxxxxxxxxxxx, Franco Gornati <francogornati@xxxx>
>wrote:
>> Fred wrote
>> >Personally I prefer my braille trading system so I can "feel" it.
>>
>> Is it profitable? Are you doing better than the market? Don't
>> misunderstand me, i know you are consistent in your approach so you
>> can say better than anyone else if there is such inefficiency in the
>> market to allow extra profits from past prices only.
>>
>> --
>> Franco
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