The Janus Factor: Trend Follower’s Guide to Market Dialectics

$21.20

Author(s)

Gary Edwin Anderson

Format

PDF

Pages

144

Published Date

2012

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The Janus Factor presents an innovative theory that describes how feedback loops determine market behavior. The book clearly shows how the theory can be applied to make trading more profitable. The metaphor of the two-faced god Janus is used to reflect alternating market environments, one dominated by trend followers and the other by contrarian bargain hunters.

Introduction:

To A Trader, some profits may seem to come more easily than others. There is a reason for this―known as the Janus Factor―and it’s the single most powerful influence on your trading results. Nobody understands this better than author Gary Edwin Anderson–a thirty-five-year market veteran and winner of the 2003 Charles H. Dow Award from the Market Technicians Association. And now, with The Janus Factor, he shares his extensive insights on this important topic with you.

Janus was the Roman god of gates and doors and was represented by two opposing faces, suggesting the two-sided nature of things. Here, Anderson uses the metaphor of Janus to explain the dual nature of the markets and how the markets vacillate between two different environments: one which is dominated by trend followers and the other by contrarian bargain hunters.

As Anderson addresses how to recognize these shifts–which will put you in a better position to improve your odds of success from market to market–he also offers a systematic view of how positive and negative feedback loops drive capital flows in the stock market. With a firm understanding of how those flows tend to favor either sector leaders or sector laggards at different time, you’ll not only be better equipped to find the market’s high-probability sweet-spot, but you’ll also discover how to avoid low-probability trades. Along the way, Anderson also shows you what it takes to compute “The Spread,” which he considers a trader’s ultimate risk-management tool.

Whether you’re a new trader or a seasoned pro, The Janus Factor has what you need to succeed. Filled with valuable insights into market behavior and new methods for interpreting stock market trends, this reliable resource will help you enter the market with confidence and exit with profits.

Author’s Note:

This book embraces both theory and craft. In the first five chapters, I present a systematic view of the market, not as a battle between buyers and sellers, or even between bulls and bears, but as a struggle for dominance by traders holding to radically opposed paradigms. A new measure of risk is offered, and on that theoretical foundation I build a method.

Craft confronts a real world of noisy data and thorny reality, so in the remaining six chapters I apply these methods to the historical record. In the final three I detail strategic indicators, which readers may use to guide day-to-day trading decisions. Some of what I demonstrate is, so far as I know, taught nowhere else. The main ideas presented in this book are simple but crucial for anyone who wishes to trade successfully in all market environments.