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Rating: 
Summary: Academics who do not trade should not write trading books
Review: As a very experienced trader, my opinion about this book, in a word, is "awful".1. The tables of results are not really of any particular use to traders...nor to anyone else, as far as I can determine. 2. They used 12 years for testing 60 indicators for 878 equities - 1985 through 1996 period. I don't know what the criteria are those particular symbols, that is not explained. The years used skews the results toward long trades, which shows up in their results. 3. Rather than benchmarking against the S&P, DOW or Nasdaq 100 or some similar benchmark, as is usually done, they strangely used a quarter hold strategy - without really defining the entries and exits for the holds. 4. For most of the testing they assumed apparently immediate fills. For most of the results they ignored commission costs and slippage considerations. 5. They used no money/risk management techniques. Appears that they were either fully invested or fully in cash whenever they assumed a position. This is an assumption on my part because the authors do not explain, other than suggesting near the end that portfolio management may improve the results. 6. Their entries and exits were without any confirmations, on the day period immediately following the signals. No experienced trader whom I know, does that. 7. Only day periods were tested. Not clear to me exactly how they assumed entry and exit - at open, at a specific price, or whatever. Did not find any adequate explanation. One could argue that neither author understands order executions, order routings, order types, intraday fills, stop losses, trailing stops, stop entries or profit targets - because, incredibly, they leave all of that out! 8. From their explanations of how they used each indicator, it does not seem to me that they understood many of the indicators, not really how to correctly use many of them. I think they simply read a little something about each indicator, but whatever they did, too often their inexperience, lack of knowledge, shows through. Above, plus other things in the book, lead me to believe that neither author, both full time academics, has much actual trading experience. If they had, they would have measured the tests differently; chosen a more representatively valid selection of years; explained their entries and exits far more explicitly; chosen different indicators in many instances; etc. They could have sought and heeded the advice of real traders, before beginning their academic exercise - but apparently did not. Lastly, I strongly suspect that both authors were, their claims to the contrary notwithstanding, biased towards a buy and hold strategy - which 2000 through 2002 pretty much has trashed. Both authors are professors in finance, and that may have predisposed them towards their selection and methods of measures, selection of years to test, and other matters. The concept of testing indicators is a great idea. Maybe someday someone with adequate research and trading skills will do that well. These two authors did not.
Rating:
Summary: Academics who do not trade should not write trading books
Review: As a very experienced trader, my opinion about this book, in a word, is "awful". 1. The tables of results are not really of any particular use to traders...nor to anyone else, as far as I can determine. 2. They used 12 years for testing 60 indicators for 878 equities - 1985 through 1996 period. I don't know what the criteria are those particular symbols, that is not explained. The years used skews the results toward long trades, which shows up in their results. 3. Rather than benchmarking against the S&P, DOW or Nasdaq 100 or some similar benchmark, as is usually done, they strangely used a quarter hold strategy - without really defining the entries and exits for the holds. 4. For most of the testing they assumed apparently immediate fills. For most of the results they ignored commission costs and slippage considerations. 5. They used no money/risk management techniques. Appears that they were either fully invested or fully in cash whenever they assumed a position. This is an assumption on my part because the authors do not explain, other than suggesting near the end that portfolio management may improve the results. 6. Their entries and exits were without any confirmations, on the day period immediately following the signals. No experienced trader whom I know, does that. 7. Only day periods were tested. Not clear to me exactly how they assumed entry and exit - at open, at a specific price, or whatever. Did not find any adequate explanation. One could argue that neither author understands order executions, order routings, order types, intraday fills, stop losses, trailing stops, stop entries or profit targets - because, incredibly, they leave all of that out! 8. From their explanations of how they used each indicator, it does not seem to me that they understood many of the indicators, not really how to correctly use many of them. I think they simply read a little something about each indicator, but whatever they did, too often their inexperience, lack of knowledge, shows through. Above, plus other things in the book, lead me to believe that neither author, both full time academics, has much actual trading experience. If they had, they would have measured the tests differently; chosen a more representatively valid selection of years; explained their entries and exits far more explicitly; chosen different indicators in many instances; etc. They could have sought and heeded the advice of real traders, before beginning their academic exercise - but apparently did not. Lastly, I strongly suspect that both authors were, their claims to the contrary notwithstanding, biased towards a buy and hold strategy - which 2000 through 2002 pretty much has trashed. Both authors are professors in finance, and that may have predisposed them towards their selection and methods of measures, selection of years to test, and other matters. The concept of testing indicators is a great idea. Maybe someday someone with adequate research and trading skills will do that well. These two authors did not.
Rating:
Summary: waste of your time and money
Review: Book is useless for someone trying to make money in the stock market. Its purpose is to pad these guy's resumes.
Rating: 
Summary: Good, but could be more useful
Review: If you are wondering why the efficient market theory/technical analysis debate can't be put to rest by empirical data, you need wonder no longer. Bauer and Dahlquist establish beyond question (at least to those with open minds) that technical analysis does work. Real TA fans will be disappointed, though, that the edge TA gives is shown to be minuscule. One of the most interesting conclusions from this book is the fact that purely mechanical systems, based on one or two indicators, and applied with no real preselection of stocks, probably will not make you any money. What is missing from this book is a study of the use of chart formations (other than candlesticks) in conjunction with indicators.
Rating: 
Summary: Great Reference Book
Review: If you have ever wanted to know how bollinger bands are constructed, this is the book for you. It explains how every conceivable indicator is constructed and the theory behind the construction. I am not a trader so I will not comment on the authors' testing methodology. I only used the book for work, for research and anylatical purposes.
Rating:
Summary: Great Reference Book
Review: If you have ever wanted to know how bollinger bands are constructed, this is the book for you. It explains how every conceivable indicator is constructed and the theory behind the construction. I am not a trader so I will not comment on the authors' testing methodology. I only used the book for work, for research and anylatical purposes.
Rating:
Summary: save your money
Review: The authors are both academics, and it shows. This book seems to be just another one trying to answer the age-old (and, at this point, boring) question as to whether or not technical analysis really works. I was attracted to this book for 2 reasons: 1) The authors present an incredible depth of analytical results, at least on the surface, and, 2) they cover a wide range of indicators and show how most of them are calculated. Their basic thesis, however, is quite flawed. They seem to want to compare the results of trading each technical indicator individually (as an island unto itself) with the results of a buy-and-hold strategy. In my mind, the power of each technical indicator is in its ability to filter out the "dead wood" and help you focus on the stocks that have the most current short-term potential. However, anyone who trades for a living knows that it would be foolish to rely on one indicator to determine when to make a trade. The power of indicators lies in their intelligent combination. The authors hardly go anywhere at all with this concept. Furthermore, anyone who makes a living trading will also tell you that it's your entry and exit strategy, as well as sound money management, that makes or breaks you. This book is not for traders - it's for academics who like to keep asking themselves the same boring question about whether or not technical analysis works. There are also better books out there that will teach you about technical indicators and how to use them correctly.
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