30-years ago it was considered irresponsible to use a market timing strategy to try and outperform the S&P 500. In recent years as investors have started to gain increased levels of access to historical data and the tools to develop effective trading models, it might now be considered irresponsible to not use a market timing strategy.
At least that’s what famed investor and gambler Blair Hull believes, and his recent study on building a market timing strategy that predicts future returns, proves exactly that. Read more »
When times are good the economy is strong and everyone has more money to spend. So is there any relationship between consumer spending and the stock market?
A new research paper suggests there is and provides a novel way of measuring consumer spending on a daily basis. Instead of looking at more traditional measures (such as personal income or consumer sentiment) the paper focuses on box office earnings. Read more »
Some investors focus on momentum stocks. Some look for value. Contrarian traders search out for the most hated or worst performing stocks.
Recently, I came across the following graphic from Bloomberg which shows the 2017 performance of the 10 most shorted stocks in Asia: Read more »
Position sizing is an important topic but many investors don’t give it much thought.
In this article I will look at a method that uses the RSI indicator to size positions. This means we can buy more when the price is low and buy less when the price is high. Read more »
I have recently been looking at some old materials and I came across another interesting work by Larry Connors and Cesar Alvarez regarding Bollinger Bands.
Bollinger Bands were developed by John Bollinger and can be used in a number of different ways. In this article, we will use Bollinger Bands to find mean reversion trades.
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The focus of this article is a new study by Caporale and Plastun. They suggest that there’s an edge to be had in forex markets by trading gaps. However, they could not find an edge in other assets.
Following are some of the findings from the research paper and then some concerns we have about their results: Read more »
The world of social media has evolved rapidly in recent years. Traders and investors widely use various platforms both as a means of getting access to news and for trading ideas.
Using social media as a trading indicator isn’t a new concept and the sentiment of tweets from Twitter has previously been shown to lead to outperformance in various different studies. Read more »
Longer term readers and members will know that I try to keep Marwood Research updated with new trading strategies and information on a monthly basis.
This month we have added a brand new trading strategy to the program called Trading For Yield. Read more »
In this article I look at some interesting new research from Haoyu Xu that can be useful for both momentum investors and reversal traders.
The research finds that morning returns positively predict next month returns (momentum) while afternoon returns negatively predict next month returns (reversals). Read more »
Blair Hull is a legend of Wall Street and a former professional blackjack player. He was named by Worth magazine as one of Wall Street’s 25 smartest players and by Forbes magazine as one of the most successful traders of the last 40 years.
Today, Hull operates a number of ventures including an ETF that attempts to time the S&P 500 through a mix of 12 technical and fundamental indicators. In this article, we will look at the idea behind Blair Hull’s strategy and the 12 indicators he uses. Read more »