 | Summaries and Customer Reviews are supplied by Amazon.com | The Encyclopedia of Trading Strategies is for traders who want to take the next step to consistently profitable trading. The authors--themselves seasoned veterans of the futures trading arena--pinpoint the trading methods and strategies that have been shown to produce market-beating returns. Their rigorous and systematic backtesting of each method, using the same sets of markets and analytic techniques, provides a scientific, system-based approach to system development...to help you assemble the trading system that will put you on the road to becoming a more consistently profitable trader. |
Average Customer Rating:   Potentially very harmful: fairly useful section on exits I hate reviewing books like this. It would be awesome to say, "this is total nonsense; never, ever read it." However, there is actually good stuff in it, which makes me work at reviewing it.
The good: the section on exits is quite good. It could be better, but I can't think of anything out there which actually is better. Selecting an exit strategy is *most* of a trading strategy. It matters a lot less when you buy than when you sell if you're into, like making a profit. I actually bought the book based on the recommendation of someone smarter than me, specifically for the chapters on exits, and I was no disappointed in this part. The sections on technical analysis and standard indicators aren't bad either, though like most treatments of this sort of thing, TA comes off looking like magic rather than what it properly should be thought of; which is to say, lousy non stationary filters which might inform other traders you should be trading against. His statistics aren't exactly right, but they're not always completely insane either.
The bad: this book is mostly an exercise in data mining and hindsight bias. Genetic algorithms? Optimizers? Give me a break! He doesn't deal with real issues in doing this sort of trading; for example, signal to noise ratios of various kinds. He doesn't properly deal with issues of overfitting (yes, you must test out of sample, but there is a whole lot more you can do to reassure yourself you haven't just fit to a bunch of noise). There is a chapter on fitting to solar and lunar cycles, which is, of course, data mining lunacy. The software he uses is of course all antiquated stuff which was out of date before I could legally drink alcoholic beverages; no help there. Risk management? Money management? These are also crucial pieces of any trading strategy: they're not covered at all here. I guess the book is oriented towards data mining punters who don't care so much about such niceties, but, well, I find such things important. I'm not sure I'd trust what the author had to say about such things, but it's something everyone with money on the line should be worrying about. Also: this is hardly anything resembling "an Encyclopedia of Trading Strategies" -so don't expect it to be, and you might not be disappointed.
So, this book can be useful if you already know enough to know which parts are nonsense. I guess this is an issue with all books and papers dealing with this subject; you can often take a chapter here and a section there, but books of this nature seem to have a lot of red herrings. Sometimes it's hard to tell if they are there on purpose, or as filler to sell the good sections. I dunno. Anyway, don't try to make a zillion dollars using genetic algorithms like they talk about in this book: you will fail. Good but outdated This book needs a complete overhaul.
Markets have changed, tactics have changed and the whole internet and technology boom has had a tremendous effect on markets. There are other books on trading strategy that are more current, and ones that focus on specific markets...such as stocks or currencies. You would be better off with something updated. Generally, from a 'big picture' point of view the book still holds up...but you can find general big picture info at the numerous websites offering free education and lessons.
A new, up to date, well tested and proven version of this is needed. Deceiving name As a software engineer I needed a book that will teach me some trading strategies that I can program and bought this book hoping to find a list/ideas of trading strategies, as you expect from Encyclopedia. Unfortunately this is the most not practical book I have ever read, if you think you'll be able to trade after reading this book you're wrong!
It has academic theoretical discussions about trading systems by testing the most simple and basic setups just to tell you that they don't work if you trade them automatically (crossing MAs, breakouts etc). I'm sorry but you don't need to have Phd to know that, they don't even try to come up with a strategy that work!
Who can benefit from this book? If you are in your Master/Phd studies and looking for theoretical trading academic book, no doubt this is for you, all the rest try something else... A must read if you plan to trade Anyone planing on or currently trading using technical analysis should read this book. The lessens inside can help prevent loss of savings.
This book takes a careful look at various types of technical indicators and trading strategies that use technical analysis, the types of methods commonly found in charting software and technical analysis books. For me the bottom line is that making a consistent income from trading, using technical analysis, is difficult. (Losing money is not so difficult).
The software referenced in the book and available for a relatively small price, is in my opinion very powerful, but difficult to master (C++ source code that must be compiled, debugged for your compiler, and modified to create useful systems). Review of simulation results This book provides an overview on the type of strategies available and shows the results done on the different strategies. For system developers it is useful to know that most strategies - pure trending, oscillators etc do not perform well at all!
What is lacking is a more thorough analysis of the different methods. Overall a useful book which highlight the pitfalls which system developers will fall into. |  |
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