As a fairly new portfolio manager, I have got a lot out of...

As a fairly new portfolio manager, I have got a lot out of reading Robbbbbbb's posts and watching his videos (thankyou Robbbbbbb).

As a Masters of Applied Finance student, I find the 'theoretical response' to charting and TA interesting.

At Uni they teach:
The market is efficient (at least, it is Weak Form Efficient factoring in all past price information) thus T/A can not lead to abnormal profit.

'They' also say trading increases costs and active management does not empirically beat passive management in long run studies.

Rather 'they' say asset allocation is key, taking into consideration top down economic and industry sector analysis - both of which are critical, while individual asset selection contributes only in a minor way to overall long run returns.

'They' also argue the market is Semi-Strong Form Efficient too, meaning fundamental analysis is unable to provide abnormal profits (too many people have the same info at the same time - so market responds efficiently).

However, 'they' are slightly more positive about the relative worth of 'fundamental analysis' compared to T/A - with many caveates including that F/A is only as good as the as the analyst and the information available.


Me, I just want to make money, so am happy to learn from Robbbbbbb and school, Jim Cramer and whomever I can - and believe among other things you make money when you buy your asset.


Ozebloke
:) Needs a catchy throw away line