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The Heretics of Finance: Conversations with Leading Practitioners of Technical Analysis (Bloomberg Press)

The Heretics of Finance: Conversations with Leading Practitioners of Technical Analysis (Bloomberg Press)
By Andrew W. Lo, Jasmina Hasanhodzic

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Product Description

This book provides extraordinary insight into both the art of technical analysis and the character of the successful trader. Distinguished MIT professor Andrew W. Lo and researcher Jasmina Hasanhodzic interviewed thirteen highly successful, award-winning market professionals who credit their substantial achievements to technical analysis. Together, these lively and candid interviews tell the story of technical analysis in the words of the people who know it best. The first half of the book focuses on the technicians' careers: how and why they learned technical analysis, what market conditions increase their chances of making mistakes, what their average workday is like, to what extent trading controls their lives, whether they work on their own or with a team, and how their style of technical analysis is unique. The second half concentrates on technical analysis and addresses questions such as the following. Did the lack of validation by academics ever cause you to doubt technical analysis? Can technical analysis be applied to other disciplines? How do you prove the validity of the method? How has computer software influenced the craft? What is the role of luck in technical analysis? Are there laws that underlie market action? What traits characterize a highly successful trader? How do you test patterns before you start using them with real money?   Interviewees include: Ralph J. Acampora, Laszlo Birinyi Jr., Walter Deemer, Paul F. Desmond, Gail M. Dudack, Robert J. Farrell, Ian McAvity, John J. Murphy, Robert R. Prechter Jr., Linda  Bradford Raschke, Alan R. Shaw, Anthony W. Tabell, Stan Weinstein.    

Product Details

  • Amazon Sales Rank: #369494 in Books
  • Published on: 2009-01-07
  • Original language: English
  • Number of items: 1
  • Binding: Hardcover
  • 288 pages

Features

Editorial Reviews

Review

"Technical trading is ubiquitous in financial markets, which might explain some major financial-market anomalies and makes it an important topic for research. Like good scientists, Lo and Hasanhodzic explore this territory by gathering first-hand observations, with fascinating results." -- Christopher J. Neely, PhD "

Review

“Technical trading is ubiquitous in financial markets, which might explain some major financial-market anomalies and makes it an important topic for research. Like good scientists, Lo and Hasanhodzic explore this territory by gathering first-hand observations, with fascinating results.” —Carol Osler,
Program Director, Lemberg Masters in International Economics and Finance, Brandeis International Business School, Brandeis University


“. . . a fascinating view of the art and craft of technical analysis.  For finance professionals and academics alike, this book is an excellent introduction to what technical analysts do and why it may make sense in modern markets. An enjoyable and very enlightening book.” —Maureen O’Hara , Robert W. Purcell Professor of Finance, The Johnson School, Cornell University    


"In the last twenty years, academics have piled up evidence on the puzzling success of technical analysis, yet few researchers are very familiar with the thinking of technicians.  Lo’s and Hasanhodzic’s interviews with well-known technicians illuminate their thinking on the markets and their profession. THE HERETICS OF FINANCE  is a must-read for economists studying technical analysis, behavioral finance, or related market anomalies. I recommend it highly.” —Christopher J. Neely, PhD


"Technical trading is ubiquitous in financial markets, which might explain some major financial-market anomalies and makes it an important topic for research. Like good scientists, Lo and Hasanhodzic explore this territory by gathering first-hand observations, with fascinating results." (Caroil Osler, Program Director, Brandeis University )

". . . a fascinating view of the art and craft of technical analysis. For finance professionals and academics alike, this book is an excellent introduction to what technical analysts do and why it may make sense in modern markets. An enjoyable and very enlightening book." (Maureen O'Hara, Cornell University )

"In the last twenty years, academics have piled up evidence on the puzzling success of technical analysis, yet few researchers are very familiar with the thinking of technicians. Lo's and Hasanhodzic's interviews with well-known technicians illuminate their thinking on the markets and their profession. THE HERETICS OF FINANCE is a must-read for economists studying technical analysis, behavioral finance, or related market anomalies. I recommend it highly." (Christopher J. Neely, PhD )

From the Back Cover

Andrew W. Lo and Jasmina Hasanhodzic argue that the only way to truly understand technical analysis is to talk to the practitioners who know the most about it. To that end, the authors conducted in-depth interviews with thirteen of today's top technicians: Ralph J. Acampora, Laszlo Birinyi Jr., Walter Deemer, Paul E. Desmond, Gail M. Dudack, Robert J. Farrell, Ian McAvity, John J. Murphy, Robert R. Prechter Jr., Linda Bradford Raschke, Alan R. Shaw, Anthony W. Tabell, and Stan Weinstein. These pioneers share their favorite patterns, indicators, strategies, and the applications that led to their success. The lively and surprisingly candid interviews with these technical gurus are framed in the context of their personal experiences and offer fascinating insights into the role that creativity, emotion, and intuition play in the craft.

Customer Reviews

Excellent read on how leading T/A practitioners think and what they believe5
What a gem of a book, especially for a new or intermediate level investor who is looking for a broader perspective on the type of investment methods they might want to follow. There are no charts in the book, and only a few techniques or systems get described in any detail. This is a "why" book more than a "how to" book, although some of the analysts have written books on their techniques if you find something that lights a bulb for you.

The basic flow is a set of common questions asked of leading technical analysts, like John Murphy, Stan Weinstein, Bob Farrell, Paul Desmond and Ralph Alcampora (similar to the "Market Wizard's" books). The questions and the complete set of answers provides a rich look inside the thoughts and beliefs of some of the giants of technical analysis, like insights on why technical analysis is a study of market psychology as analyzed through the filter of supply and demand, that technical analysis is really the best way to "time" a trade, even if fundamental analysis is used to find better potential candidates, on how to increase the "signal to market noise" ratio to improve performance, and the critical differences between an analyst/investor and a trader, and how you better find out which suits your personality best if you hope to succeed in the markets.

Some of the questions take the analysts back to the start of their career to see how they found their way to becoming leading analysts, and why they made some of the choices that they did. For someone who wants to know "why" someone did what they did in the investing world, this is a great read. If you still think that fundamental analysis is the only way to analyze markets and that technical analysis is voodoo, this book will open your eyes.

Enjoy!

Disappointing2
I had hoped this book would be similar to "Market Wizards", or a more recent book like "Hedge Hunters". These books contained *interviews* with successful traders. Unfortunately this book doesn't really contain interviews, it's more like a single questionnaire that was sent out to a bunch of people, and this book collects all of their answers. It makes for pretty boring reading, because there's no conversation between interviewer and interviewee, no followup questions or any kind of reaction to the answers given.

It could have been so much more!3
I can't help but feel that much more could have been done with and asked of the incredible pool of talent that the authors spoke to in putting this book together. While I can understand that coming up with a list of standard questions probably made it easier to write--it would have been so much more interesting for the reader had the questions been specific to the work each of these technicians does. Still, this book will be for many a wonderful introduction to the men and women who have been working in this field for several generations. Insights and experiences are shared--and if you are truly interested in technical analysis, as I am, and want to hear from some of the people who have forever changed the work we do--I don't see how you can resist buying this book.