Product Description

Get the bestselling guide to trading systems, now updated for the 21st century.

For more than two decades, futures traders have turned to the classic Trading Systems and Methods for complete information about the latest, most successful indicators, programs, algorithms, and systems. Perry Kaufman, a leading futures expert highly respected for his years of experience in research and trading, has thoroughly updated this bestselling guide, adding more systems, more methods, and extensive risk analysis to keep this the most comprehensive and instructional book on trading systems today. His detailed, hands-on manual offers a complete analysis, using a systematic approach with in-depth explanations of each technique. This edition also includes a CD-ROM that contains the TradeStation EasyLanguage program, Excel spreadsheets, and Fortran programs that appear in the book.

Product Details

• Amazon Sales Rank: #24748 in Books
• Published on: 2005-02-28
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 1200 pages

Review
". . . the best book on technical trading strategies and techniques currently available. . . A must read." (The Technical Analyst, March/April 2006)

"... it's packed with a ton of useful information on programs, spreadsheets, algorithms and other tools. It even comes with a CD-ROM that's pulsing with more hot, sexy info covering just about every trading trick under the sun." (Trader Monthly magazine, June/July 2005)

"At $125, the book is not cheap, but no trader should be without it." (Managed Account Reports (MAR), April 2005)

From the Inside Flap
As markets evolve, so must the strategies used to trade them. No one understands this more than Perry Kaufman—one of today's most respected futures experts. For more than twenty-five years, traders have turned to Kaufman's classic Trading Systems and Methods for complete information about the latest, most successful indicators, programs, algorithms, and systems. Now, in New Trading Systems and Methods, Fourth Edition, Kaufman thoroughly updates his bestselling guide—adding more systems, more methods, and an extensive array of risk analysis techniques—and shows you the best ways to trade today's futures and equities markets. The companion CD-ROM, which contains TradeStation® code and Excel spreadsheets, has been added to help you electronically implement the systems and methods mentioned throughout the book.

New Trading Systems and Methods, Fourth Edition provides you with a complete understanding of the tools and techniques needed to develop or choose a trading program that is right for you. It begins with a discussion of basic concepts, including definitions, how much data to use, how to create an index, some statistics and probability, and other tools that will be used throughout the book, then moves on to techniques that are most important to trading—identifying the trend and momentum. Other chapters are organized by common grouping so that you can compare the different ways that similar problems have been solved. The systematic approach to charting has been significantly expanded in this edition, showing how various patterns can be compared to other systematic methods, or how techniques such as identifying support and resistance, or channels, can be computerized. Examples include a wide range of futures and stocks.

New Trading Systems and Methods, Fourth Edition doesn't attempt to prove that one system is better than another, because it's impossible to know what will happen in the future or how you will cleverly apply these techniques. Instead, it tries to evaluate the conditions under which certain methods are likely to do better and the situations that will be harmful to specific approaches. By grouping similar systems and techniques together, you'll be able to personally compare the differences and study the results. Seeing how analysts have modified existing ideas can help you decide how to proceed and give you an understanding of why you might choose one path over another. Since no trader can be successful without controlling risk, this edition also includes expanded coverage of portfolio allocation, which will allow you to efficiently balance trading exposure.

As the competition for trading profits gets keener, you need to look for more innovative—and sometimes more extensive—solutions. You need strategies that are different from those of other traders. You need the tools, skills, and awareness that only New Trading Systems and Methods, Fourth Edition can provide.

From the Back Cover
PRAISE FOR NEW TRADING SYSTEMS AND METHODS FOURTH EDITION

"Probably the most comprehensive guide to trading systems ever written from one of the foremost experts in the field. This is an invaluable reference work for anyone with an interest in trading systems."
—Jack D. Schwager, author of The New Market Wizards and the Schwager on Futures book series

"In trading, timing is everything, and now is the time to read this excellent and easy- to-follow book on technical trading systems by Perry Kaufman. He shares his trading tips, insights, and sound advice. He takes you from his rules on price to the recognition of trends and the importance of breakouts. Enjoy this book and find out why trading systems work and which ones work the best."
—Ralph J. Acampora, CMT, Director of Technical Research, Prudential Securities, Inc.

"Investors and traders who have been battered by the markets in recent years may find themselves saying, 'There must be a better way.' There is: systematic trading. In this timely book, Perry Kaufman provides an excellent introduction to the world of systematic trading, where rules—not emotions—rule."
—John Bollinger, CFA, CMT, founder, www.bollingerbands.com

"An updated version of the original and masterful 'how to' book that provides an in-depth analysis of trading techniques. The entire process for designing, developing, and testing trading strategies is put into a cohesive framework."
—David Krell, President and CEO, International Securities Exchange, Inc., New York

"This new edition of New Trading Systems and Methods is a unique source of knowledge and experience for all those seeking to apply a more systematic approach to the markets. From traditional trading methodologies to lesser-known techniques like genetic algorithms or fuzzy logic, all are treated in a very practical way. It's full of practical ideas and examples to start testing right away."
—Jorge Bolivar, founder of Expert Timing Systems Intl. and TechRules.com, Madrid, Spain

"Perry Kaufman's New Trading Systems and Methods, Fourth Edition, is a must-read for any student of technical analysis. The book is a veritable encyclopedia of the mechanics of sophisticated trading systems by one of the most knowledgeable experts in the industry. Highly recommended."
—Kenneth G. Tropin, Chairman, Graham Capital Management, LP

Customer Reviews

Technical Details for the Technical Analyst
Many people refer to the Achelis book for simple, straight-forward descriptions of technical analysis tools. I too have it on my primary bookshelf. However, lately, more often than not, I find myself reaching for Kaufman's book to get good background on the various ways of technically analysing trading options. He has chapters devoted to practically every indicator type you may encounter: chart reading, events, regressions, trending, momentum, oscillators, seasonality, cycles, patterns, multiple time frames, and advanced techniques. He then goes into some details regarding system testing, practical considerations, risk control, and diversification. As a wrap up, he provides some end-notes for the mathematically inclined.

There appear to be traders who will sit at their screen all day and watch patterns. I think many who wrote many of the recent reviews may fall into this category, and didnt' rank the book very highly. On the other hand, there are other traders who may wish to design Automated Trading Scenarios and need some math to flesh out their trading strategies. It is for these types of traders to whom this book is devoted. I think you'll find a wealth of ideas you can mix and match to make a trading strategy uniquely your own.

However, technical anlysis and automated trading strategy design takes much work and energy. A good chunk of statistics is practically mandatory (which the book doesn't delve into). This book fulfills only a portion of the overall knowledge someone will need build a winning trading strategy.

I'll give it two thumbs up as it provides excellent details on the spectrum of technical analysis and provides references for the times you wish to flesh out the details.

Excellent material in 4th edition
Similar to many traders who own Perry Kaufman's 3rd edition of New Trading Systems and Methods, I ignored the publication of the 4th edition. Well, such oversight was my loss. Even a quick perusal of the work reveals a wealth of new ideas, techniques, and concepts. Kaufman offers ample inspiration for exploring trading problems in a new light.

Kaufman's encyclopedic coverage is unique. The 3rd edition contains 700 plus dense, fast paced material. The current edition adds another 500 pages of new and revised material. Each topic is examined with care; Kaufman has an ability to focus on the key concepts and omit the fluff. His presentation assumes a sophisticated, intelligent reader with solid software development, testing, and trading skills. Sloppy readers, clumsy testers, undisciplined `traders' will complain that this is not a `trading war stories book'--such complaints are correct; this is a trading SYSTEMS and METHODS handbook.

The book binding has a problem. At 1,200 pages, the adhesive binding is falling apart. This book requires either sewn through or over-sewn type binding. Shame on John Wiley for such embarrassing production quality!

What more could you ask for in a book???
Trading is serious business, although you wouldn't think so, considering the way many people approach it.

The fundamental truth about all types of markets is that the minority gets the money, and keeps it. Of course, there will be times where the market trends strongly in one direction (usually up), and the masses confuse a bull market for brains. But those who are serious about earning profits, and keeping them, need to develop a method or philosophy to separate their thoughts and actions to act independently from the crowd.

If there were college level courses in financial speculation, Kauffman's book would be the required text. All sorts of twists on trend following, counter trend strategies, technical indicators, statistical methods, as well as various charting techniques, are all described. I should also add, the book comes with a CD that enables you to test various methods described in the book using Excel spreadsheets. The spreadsheets are already set up, you just need to input the data.

Some reviewers say that all of the methods are "bad." I'd disagree. This book is a valuable reference, and when you understand the logic of what has come before, you can adapt it to current market conditions. There are a surprisingly large, but finite, number of ways to slice and dice market data. But there are an infinite number of ways to combine a few them into a robust trading system.