A trailing stop is a stop loss order that moves with the stock price. As the stock price rises, the stop moves higher too, locking in profit and reducing the risk of a loss. For example, suppose you buy Apple at $100 and enter a $20 trailing stop. When Apple moves to $120, your stop […]
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How To Invest With Intelligent Machines – Lessons From Garry Kasparov
I’ve been reading the book Deep Thinking by Garry Kasparov. Kasparov is one of the greatest chess players of all time. He ranked number one from 1984 until his retirement in 2005, obtaining a peak rating of 2851. Kasparov is also remembered as the first world champion to lose a match against a computer, IBM’s […]
Should You Buy Low Priced Stocks?
Some investors believe that lower price stocks produce better investment returns than higher priced stocks. It’s always tempting to look at stocks trading under $10 in the hope of finding a ten or twenty bagger. In some ways this makes sense. Higher priced stocks are often larger and more mature businesses that grow more slowly. Low […]
20 Technical Analysis Patterns You Need To Know
Technical analysis is a method used to predict financial markets that relies on analyzing price charts and patterns. This is contrary to fundamental analysis which relies on economic and business information like interest rates or earnings. Technical analysis is a highly debated subject because academics say that markets are too efficient to be predicted by […]
Performance Of Our Trading Systems In 2019
One of the main reasons why I started Marwood Research is so I have a place to store all of my trading systems. Uploading them online means I can now look back and see how they have performed since they were published. Being able to evaluate the systems on new, unseen data is really important […]
26 Remarkable Trading Strategies For The Stock Market
The last 20 years has seen the amount of research into stock market trading strategies explode. Take a look at a website like SSRN and you’ll find thousands of academic papers investigating market anomalies. I love testing and reading about new strategies. In this post, you’ll learn about some of the most interesting strategies that […]
Should You Combine Trading Strategies?
The general advice with trading systems is that you should try to combine multiple trading strategies together in order to get the benefit of diversification. Having a suite of profitable trading algorithms means that you can obtain a smoother drawdown and reduce your chance of having a losing day, week, month, year. However, is it […]
The Truth About Intraday Momentum
A few years ago an interesting paper called Market Intraday Momentum was published which revealed a simple trading edge for the S&P 500 ETF. According to the paper, the first half-hour in the S&P 500 predicts the last half-hour. So if the first half-hour is positive, the last half-hour also tends to be positive. In […]
How To Trade The Controversial Double Top Pattern
The double top is a bearish chart pattern consisting of two consecutive price peaks that leads to a bearish reversal. For years, traders have claimed that the double top pattern is a high probability short setup. This is because a double top signifies that bulls are having trouble pushing the price past the prior high. […]
3 Simple Ways To Trade Divergence
A reader asked about trading divergence so I thought I would look into it. Searching the web I found many articles that claim divergence trading is an effective way to trade stocks. However, there is very little empirical evidence provided. In this article we test several different divergence strategies and we compare our results to […]
How To 10x Your Momentum Returns
The backbone of personal finance is to save more than you spend and invest the proceeds. The most common advice is to put your money into cheap index funds each month with a simple allocation split. But what if you want to try something more adventurous? Index investing may only provide returns of six or […]
Beware YouTube Trading Videos
I rarely watch trading content on YouTube but last week I clicked on a forex video that caught my attention. Soon enough, I had fallen down a rabbit hole. My feed was taken over by trading videos and in between were advertisements for signal services and chat rooms promising quick and easy profits. YouTube has […]
Simple But Risky Volatility Strategy For VXX
I’ve spent a good chunk of hours looking into volatility and I stumbled upon a simple volatility strategy for VXX. The idea is to go long the VXX ETF when volatility is rising and go short the ETF when volatility is falling. This is opposite to the usual approach which is to short volatility on sharp […]
How To Build A Mean Reversion Trading Strategy
This post contains a detailed guide for creating a mean reversion trading strategy. You will learn what mean reversion is, how to trade it, 10 steps for building a system and a complete example of a mean reversion system. Let’s get going! Introduction The two most popular types of trading strategies are momentum and mean […]
100 Greatest Stock Trading Books Of All Time
It’s about time I updated my list of best trading books so here is my selection of the 100 greatest stock trading books of all time. I’ve read a lot of these and I’ve tried to put them in some sort of order as well. Not an easy task but see what you think. If […]
