But that's not really my question... pattern-based technical analysis is not proven to generate even 0.01% of outperformance. Unless you have some study or something to prove it? I'd love to have a look!
By the way, your question was "do fund managers use pattern TA" and my answer is resoundingly YES. Check out the IBD and CANSLIM guys, they are experts in trading cup/handle breakouts and momentum trends. There's a million different ways to make money in the market outside of Warren Buffett style fundamental analysis!
So a couple things here. 1) My TA aren't only chart pattern based. They include positioning, sentiment, and breadth, flows, etc. Some of this I reference in the post. 2) My own results have shown TA removes fat left tails from my equity curve and have added alpha overall. But I don't see how one could scientifically or systematically backtest ALL ta patterns to prove that it doesn't work? I mean, if you're doing simple stuff like MA crosses, of course it doesn't work. 3) I have been using my particular strategy and refining it for nearly a decade but not everyone's experience will be the same. What worked 10 yrs ago was very different from what works now because systematic signals get crowded over time. So you need to adapt. The P/C ratio is something I discovered relatively recently in fact, but has a ton of signal at the moment (maybe not in a few years since more people are learning it). 4) TA is only one part of my analysis. I actually do not advocate using a srrategy that's purely TA unless you're day trading because otherwise there's no signal. As you can tell from my recent post, I focus heavily on macro analysis as well as stock fundamentals (I cut my teeth on value and GARP quality investing). The part I choose to write about on MktContext is just one part of my analysis that I think can add value but not a lot of practitioners are writing about. 5) I put enough of my material in front of paywall for all to see, so you can judge for yourself whether my calls are accurate or not. If not, feel free to read other folks analysis (many do it much better than me!)
Seems to me that the market's political speculation around the election has been more focused on Lina Khan's potential defenestration and the hoped-for change in M&A environment.
There seemed to be little movement based around Trump's recent comments on corporate tax rate based on the understanding that Cohn was the key player that delivered the tax cut last time.
Like the way you write. Keep it up!
Great way to start and create engagement. Keep up good work! 💪🏻
Out of curiosity: do $5B AUM fund managers really use pattern-based technical analysis? 🤔
Fund managers will use ANYTHING they can to eke out even 0.01% of outperformance
But that's not really my question... pattern-based technical analysis is not proven to generate even 0.01% of outperformance. Unless you have some study or something to prove it? I'd love to have a look!
By the way, your question was "do fund managers use pattern TA" and my answer is resoundingly YES. Check out the IBD and CANSLIM guys, they are experts in trading cup/handle breakouts and momentum trends. There's a million different ways to make money in the market outside of Warren Buffett style fundamental analysis!
So a couple things here. 1) My TA aren't only chart pattern based. They include positioning, sentiment, and breadth, flows, etc. Some of this I reference in the post. 2) My own results have shown TA removes fat left tails from my equity curve and have added alpha overall. But I don't see how one could scientifically or systematically backtest ALL ta patterns to prove that it doesn't work? I mean, if you're doing simple stuff like MA crosses, of course it doesn't work. 3) I have been using my particular strategy and refining it for nearly a decade but not everyone's experience will be the same. What worked 10 yrs ago was very different from what works now because systematic signals get crowded over time. So you need to adapt. The P/C ratio is something I discovered relatively recently in fact, but has a ton of signal at the moment (maybe not in a few years since more people are learning it). 4) TA is only one part of my analysis. I actually do not advocate using a srrategy that's purely TA unless you're day trading because otherwise there's no signal. As you can tell from my recent post, I focus heavily on macro analysis as well as stock fundamentals (I cut my teeth on value and GARP quality investing). The part I choose to write about on MktContext is just one part of my analysis that I think can add value but not a lot of practitioners are writing about. 5) I put enough of my material in front of paywall for all to see, so you can judge for yourself whether my calls are accurate or not. If not, feel free to read other folks analysis (many do it much better than me!)
Interesting. Thanks for the interesting pointers - time to dig more.
Seems to me that the market's political speculation around the election has been more focused on Lina Khan's potential defenestration and the hoped-for change in M&A environment.
There seemed to be little movement based around Trump's recent comments on corporate tax rate based on the understanding that Cohn was the key player that delivered the tax cut last time.