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"My view about this entire subject is very simple: opportunities
disappear when a lot of people realize them ... so you always have to
find something new ..."
While I wouldn't disagree with the first part of your statement I
would offer a different conclusion which is ... This is why you don't
find good systems published ...
Those that can do ... Those that can't sell ... Whether that be
systems, indicators, managed services, you name it ...
--- In amibroker@xxxxxxxxxxxxxxx, "loveyourenemynow"
<loveyourenemynow@xxx> wrote:
>
> Hi,
>
> Can you specify what do you mean by FA?
> ARIMA etc is time series analysis, and TA is primitive linear
version
> of it, mixed with some superstition
>
> Economists do not understand physic language, and they are upset
> physicists can do their job better without a PhD in finance or
knowing
> what macroeconomics is
> It is not a scientific matter, but corporative interest, whey want
to
> keep the control of the financial world
>
> Walls street quant are physicists not economy major as far as I know
> and they use time series as you mentioned not TA
>
> "Econophysics" is not my invention, is just a common term used among
> physics community
>
> My view about this entire subject is very simple: opportunities
> disappear when a lot of people realize them so you always have to
find
> something new, and TA is not so new ... and people like Gann ended
up
> living writing books rather than trading.
> It is good to give a lot of illusions to a lot of small investors so
> they can waste their money (as 90% of traders do) and give it to
banks
> and brokers
>
> In this regard TA is really successful
> Market manipulation is what really governs the market
>
>
> Thanks
> Ly
>
>
> --- In amibroker@xxxxxxxxxxxxxxx, "dalengo" <dalengo@> wrote:
> >
> > Hi there,
> > A.Lo is indeed a 'financial engineer' @MIT
> > (http://web.mit.edu/alo/www/). He doubts that 'econophysicists'
> > discovered smth substantially new, and so do I. People studying
the
> > data in question knew about 'fat' tails in distribution of
returns
> > for ages.
> > Markets are obviously not 'efficient', how they can be if a
market
> > cap of large companies can change over 50% is a matter of months?
> > However, I have surely not implied that TA can 'predict' them
(you
> > should specify what 'predict' means). On the other hand,
statistics
> > of the data and forecasting are legitimate empirical methods
applied
> > to 'quantify' finance. The insurance and mortgage cos do not use
TA,
> > they use 'econometrics', they do not use MACD, they use band-pass
> > filters, MAs in forms of ARMA and ARIMA, and
datamining/forecasting
> > with neural nets, etc.
> > Whether all this constitutes 'science' is open for debate
> > (http://minneapolisfed.org/pubs/region/00-12/review.cfm).
> > For instance, it is a result with high statistical probability
that
> > the global warming is linearly linked to the number of pirates
> > (http://www.venganza.org/).
> > And with neural nets I can easily fit my own signature,
> > so tools should be used within reason.
> > In any case, what we have is empirical datasets, and one should
make
> > ones best to optimize odds via statistical analysis (which you
may
> > call TA) in common situation with limited information. In this,
FA
> > just adds another datastream.
> > The _hypothesis_ is that one can estimate ones odds of a given
method
> > of investing, timeframe, and instrument used with some method of
> > forecasting/extrapolation.
> > If it is 'better' than fixed income, you may use it, otherwise
you
> > must not (Sharpe::
http://www.stanford.edu/~wfsharpe/art/art.htm).
> > Forecasting usually works better for the past than for the future
> > (N.Bohr), and yet one is better off using it than listening to
gurus
> > who always know where the market will be tomorrow, or using some
> > magic blackboxed 'indicator' of the same. We're talking about
> > probabilities, and even if the estimated probability of the event
is
> > zero, it may happen. Therefore, I would be in the learning camp.
> >
> > PS. As for 'econophysics', I do not think it's a good term, but
> > talking about random matrix theories, turbulence, and replica
methods
> > may certainly help those folks to collect consultance fees.
> >
> > --- In amibroker@xxxxxxxxxxxxxxx, "loveyourenemynow"
> > <loveyourenemynow@> wrote:
> > >
> > > Hi Alex,
> > >
> > > thank for the interesting link.
> > > Not random walk just means that models based on the random walk
> > > hypothesis (gaussian distribution of the stochastic component)
are
> > not
> > > accurate. It does not mean technical analysis is successfully
> > > predicting market evolution, but that other models (not random
walk,
> > > not necessarily and I would add quite likely not technical
analysis)
> > > can be more successful.
> > > By the way the two authors are not Princeton Professors
> > (MIT,Pennstate
> > > I think), and are not physicist but economists , and looking
at the
> > > Nature article you link to, they do not seem to like
econophysics
> > that
> > > much ...
> > > Econophysics papers are freely available on
http://xxx.lanl.gov,
> > but i
> > > guess economist do not even read them, I personally like them
> > >
> > > Thanks
> > >
> > > Ly
> > >
> >
>
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