Market Timing with Moving Averages provides a comprehensive guide to market timing using moving averages.This book explores the foundations of market timing rules, presenting a methodology for examining how the value of a trading indicator is computed. Using this methodology the author then applies the computation of trading indicators to a variety of market timing rules to analyse the commonalities and differences between the rules.
Given the increasing popularity of trading with moving averages, we thought of writing this book in order to overcome the shortcomings of existing books and give the readers the most comprehensive and objective information about this topic. Specifically, the goals of this book are threefold:
- 1. Provide the in-depth coverage of various types of moving averages, their properties, and technical trading rules based on moving averages.
- 2. Uncover the anatomy of market timing rules with moving averages and offer a new and very insightful reinterpretation of the existing rules.
3. Revisit the myths regarding the superior performance of moving average trading rules and provide the reader with the most objective assessment of the profitability of these rules in different financial markets.
This book is composed of four parts:
- Part I: This part provides the in-depth coverage of various types of moving averages and their properties.
- Part II: This part reviews the technical trading rules based on moving averages and uncovers the anatomy of these rules.
- Part III: In this part, we present our methodology for how to scientifically test the claim that one can beat the market by using moving average trading rules.
- Part IV: This part contains case studies of profitability of moving average trading rules in different financial markets.
- Why Moving Averages?
- Basics of Moving Averages
- Types of Moving Averages
- Technical Trading Rules
- Anatomy of Trading Rules
- Transaction Costs and Returns to a Trading Strategy
- Performance Measurement and Outperformance Tests
- Testing Profitability of Technical Trading Rules
- Trading the Standard and Poor’s Composite Index
- Trading in Other Financial Markets