In attempting to cut my risk in the financial markets during
the past decade or so, I have built and maintained dozens of indicators,
focused on comparatively broad equity-market indexes in some cases and on comparatively
narrow stock-market sectors in other cases.
The ABC Indicator
of movements in the S&P
500 (INDEXSP:.INX)
has been the most successful of these indicators. In forecasting the short-term
direction of the U.S. large-capitalization index on a closing basis, its
signals have been right on 94 occasions, or 71.21 percent of the time, and
wrong on 38 occasions, or 28.79 percent of the time.
I mention this indicator here and now because I am beginning
the first public test of it on J.J.’s
Risky Business. The test will encompass 10 signals, starting with the Buy signal flashing this Friday morning.
History suggests the indicator will be right between six and eight times and
wrong between two and four times. I can’t wait for the results!
Disclaimer: The opinions
expressed herein by the author do not constitute an investment recommendation,
and they are unsuitable for employment in the making of investment decisions.
The opinions expressed herein address only certain aspects of potential
investment in any securities and cannot substitute for comprehensive investment
analysis. The opinions expressed herein are based on an incomplete set of
information, illustrative in nature, and limited in scope. In addition, the
opinions expressed herein reflect the author’s best judgment as of the date of
publication, and they are subject to change without notice.
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