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Author: kahunacfa Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 2165  
Subject: Re: Some ETFs to Explore Date: 6/28/2012 12:44 PM
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So the next question becomes, “Why a 100-day moving-average (and not other parameters?) and why a simple moving-average (as opposed to other types)? The answer to the latter question is easy. Simple moving-averages (SMA) are the easiest to calculate, and they also are very robust, besides being able to closely replicate the behavior of the other common types (exponential, front-weighted, triangular, etc.) simply by varying the parameters of the SMA until it closely matches the EMA, WMA, etc. So, on their choice of moving-average type, I have no quarrels. SMAs are plenty good enough. What I do have quarrels with is their choice of parameters. - trader2012 | Date: 6/15/2012 6:14:44 PM | Number: 2159

trader2012,

The choice of a moving average term, i.e. 10-day, 40-day, six months, one-year, and so forth is in fact quite abritrary EXCEPT, it is best to pick and use a time-frame that has become kind-of an "Industry Standard" for Technical Analysis.

History:

When I first started to invest, February 1969 in Honolulu I ONLY used Technical Analysis. Then I did not invest, I traded, and traded successfully. Started with $2K, the minimum required for a Margin account. Used Charts, especially the Dailygraph charts that were mailed to me at the end of each trading week. Those charts would arrive Saturday. Reviewed the charts each weekend, selected the trades for Monday morning when the markets opened @09:00 EST or 05:00 HST. The markets in NYC closed @15:00 or 11:00 HST. My brokerage account was with the Honolulu Office of Merril Lynch, Pierce, Fenner & Smith(MLPF&S). A Buy or Sell transaction then used to be very expensive, in the range of $120 to $185 for a Buy or a Sell. Would, then usually have several trades per week. Since the main markets closed at 11:00 local time, I would very often go to have lunch with Ron, my MLPF&S broker at The Pub in downtown Honolulu. Last time I was in Honolulu, it was still there, still open and doing a brisk lunch time business. By March 1972 when I left the Islands, the trading account, with no new money, had a value of over $20K. Motovated by Louis Rukeyser's Wall Street Week on Maryland Public Broadcasting, I returned to the University of Wisconsin actually learn how to invest -- NOT Trade.

At the University of Wisconsin, I took this outstanding one year investment course, http://www.UWASAP.org. The course was founded my my UW Madison Adviser.

Kahuna, CFA
Venture Capital
General Partner
2012 - 2019
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