- ISBN13: 9781576603314
- Condition: NEW
- Notes: Brand New from Publisher. No Remainder Mark.
Product Description
Professional traders and smart investors use a wide range of indictors—some well-known, some not so well-known—to gauge the state of the market and to discover and understand what their colleagues are thinking and doing. Market Indicators introduces over seventy of the key indicators that suggest what other investors are up to. From a front-row perspective, Richard Sipley, a professional portfolio manager, explains how individuals can access these indicators—o… More >>
Market Indicators: The Best-Kept Secret to More Effective Trading and Investing
Tags: best kept secret, BestKept, colleagues, Effective, front row, Indicators, Investing, Making Market, Market, market indicators, More, perspective, portfolio manager, professional portfolio, Secret, smart investors, Trading
#1 by David Merkel on February 9, 2010 - 8:56 pm
Every one one us has limited bandwidth for analysis of data. We pick and choose a few ideas that seem to work for us, and then stick with them. That is often best, because good investors settle into investment methods that are consistent with their character. But every now and then it is good to open things up and try to see whether the investment methods can be improved.
For those that use market indicators, this is the sort of book that will make one say, “What if? What if I combine this market indicator with what I am doing now in my investing?” In most cases, the answer will be “Um, that doesn’t seem to fit.” But one good idea can pay for a book and then some. All investment strategies have weaknesses, but often the weaknesses of one method can be complemented by another. My favorite example is that as a value investor, I am almost always early. I buy and sell too soon, and leave profits on the table. Adding a momentum overlay can aid the value investor by delaying purchases of seemingly cheap stocks when the price is falling rapidly, and delaying sales of seemingly cheap stocks when the price is rising rapidly.
Looking outside your current circle of competence may yield some useful ideas, then. But how do you know where you might look if you’re not aware that there might be indicators that you have never heard of? Market Indicators delivers a bevy of indicators in the following areas:
* Options-derived (VIX, put/call)
* Volume and Price driven (Money flow, rate of change, 90% up/down days, and more)
* Where the fast money invests (money in bull vs bear funds, sector fund sizes, and more)
* Analyzing the likely motives of other classes of investors (margin balances, short interest, etc.)
* Price Momentum and Mean-Reversion
* Measuring asset classes and sectors using fundamental metrics (Fed model, sector weightings, Q-ratio, etc.)
* Investor sentiment surveys
* How to use analyst opinions, if at all?
* News reporting and reactions of stocks to news
* Odd bits of news (CEO behavior, little things that indicate a qualitative change in the life of a company)
* Insider buying and selling
* Commodity market data (COT, etc.)
* Bond market behavior (credit cycle, Fed moves, Credit Default Swaps, and more)
* Changes in the capital structure (M&A, equity/debt issuance, etc.)
* Monitoring the greats (13F filings)
No one can use all of these indicators. You can probably only use a fraction of these indicators. But being aware of how others view the market can widen your perspective, and help to reduce negative surprises on your part.
Quibbles
By its nature, since the book cuts across a wide number of areas in 216 short pages, you only get a taste of everything. I liked this book, but there is room for a second book in this area — one of additional indicators passed over (I have a bunch!), or going into greater depth on the indicators covered.
Who will benefit from this book?
You have to have a quantitative bent, at least to the level of being willing to go out and collect simple data in order to benefit here. Now, most serious investors do that, so I would say that serious investors can benefit from the “cook’s tour” of market indicators that this book gives, unless they are so serious that they know all of these indicators. (Like me.)
Rating: 4 / 5
#2 by Investing Book Reader on February 9, 2010 - 10:23 pm
This is a very helpful book for an individual investor. It provides descriptions and explanations of indicators that can help investors understand overall market and individual stock price direction. The indicators covered in the book are the type that you will see referenced by professional investment managers in financial articles or other media as supporting an investment outlook or forecast. As an individual investor, I’m interested in being able to know where to find and how to use indicators that professionals employ in their analysis.
The reasons I like the book are because it has:
* Information on where to find market indicators and information that professionals use to make decisions
* Explanations of how to use the indicators, often times using a narrative to give additional context around cause and effect
* Big-Picture Macro Indicators which pertain to the overall direction of the market
* Stock-specific indicators to look for when evaluating individual stocks
* Straight-forward, descriptive language and extensive use of charts and diagrams to illuminate complex topics and explain industry-specific jargon – easy to read and understand.
* Explanations of motivations behind actions of various market participants
* Lively presentation of the subject matter – wry humor, anecdotes and witty quotes.
* References or source locations for the market indicators at the end of each chapter and then in a glossary format at the end of the book, which is useful when coming back for later review.
Essentially, a wealth of information is presented in a well-organized, logical format. The book progresses from broad market indicators early to company-specific indicators to use when evaluating particular stocks. I wish I had come across a book like this long ago.
Rating: 5 / 5
#3 by Grace Hayden on February 10, 2010 - 12:46 am
As a long-time investor, I was familiar with many of the indicators in this book — in that sense, there were no ’secrets’ revealed. But what this book does is bring them together in a cohesive, well-documented and easy-to-read way. I found myself checking on referenced Internet sources which have now become part of my daily routine. For those interested in a comprehensive overview of what full-time investors and traders consider, this is a great book!
Rating: 5 / 5
#4 by AvidReader on February 10, 2010 - 2:26 am
I am new to the world of stocks and investing. In my studies I have read 3 stock intro books, 2 stock chart books, and 1 financial statements book. None of them mentioned the things listed in this book.
Some comments were made that there were no in depth reviews of this book, so I will attempt to do so here:
The book lists 15 different market indicators, that is indicators that tell us if the market as a whole should go up or down. A few of the indicators can be used on the micro level(single company) but most of them are for the stock market as a whole. There are 6 chapters dealing with what people are currently doing, 4 chapters on what people react to and how, and 5 chapters on following the insider/really intelligent investors.
These indicators are random stuff, like the options market, how to read what they think of a stock (individually or on a macro level), the ETF market, the futures market, the bond market, many of the things mentioned are looking at the side vehicles for investing in order to see how the main vehicle will react to it. The book talks about a lot more but I am starting to get mildly lost so it is taking a bit to get through it. The book is not complex in writing style, but is a little above the type of information I have come across. Every one of the 15 chapters could be written as an entire book of it’s own, in this sense, it is likely that I will have to actually read an entire book about each chapter to take full advantage of the techniques listed. But never the less the author does a good job doing what he can within minimal pages.
Each chapter while is about one single indicator does go over a few ways to reach that indicator. I do not know why the book says 100 plus indicators, it is just 15 indicators and a few ways to get each indicator. I am not smart enough to describe in more detail whats in the book, but holly cow has this book had instant applicability to my investing life. Admittedly I can’t use all of it, but it sounds like I will be able to as I learn more.
Edit Jan-17-2010: After reading the book all the way through I am very happy. This book also had stuff on insiders and big institutional(multi million-billion investors). I also notice that when I looked at his references he did a very thorough job. A quick note on his references though, he split his references in half, half at the end of the chapter and the other half at the end of the book. If you can’t tell, I love authors who do thorough referencing. The half and half referencing thing and the fact that many of his pictures are on different pages than where he mentions them, but that stuff isn’t really a drawback, more of the editors formatting stupidity.
Rating: 5 / 5