profitsinthestockmarket(编辑修改稿)

profitsinthestockmarket(编辑修改稿)内容摘要：

imple, if you know when to get in and when to get out. Although, as we shall learn, the solution to the When question is extremely important, it is also a fact that a trader can be fairly right in judging the reversals in the trends of stock prices, and yet make only a fraction of the potential profits available, because he is ignorant of systematic methods to assist him in the selection of the right stocks. The When question may be classified as a study of trends. Except for short periods of time, usually ranging for less than two weeks, stock prices have a habit of going somewhere. During the vast majority of the time, they are either advancing or declining. The successful trader must be conscious of a change in trend. Thus a continual knowledge of stock price trends is essential to the successful timing of mitments. The What question, on the other hand, depends chiefly on observation of the specific characteristics of individual stock price movements, and may be classified as a study of parisons. The solution of each of these two problems, which are about of equal importance, requires equal attention. However, as the What to buy or sell problem usually covers a much broader scope, it requires a greater amount of time. Usually, the When question, that is the timing of mitments, is studied by observing the trends in the market as a whole, or at least its major parts. The What question, which is the selection of stocks, is observed by studying small groups and individual issues. Two Approaches It is the custom of those interested in stock prices trends to approach the solutions of these two primary problems from two totally different angles, each of which may be logically subdivided into the same two categories, namely, When and What. These two approaches are: 1. The FUNDAMENTAL approach。 and 2. The TECHNICAL approach. Fundamental Approach The fundamental approach, which will be reviewed only briefly, because this course concerns the technical approach, may be classified in two general categories, namely: 1. The ECONOMIC。 and 2. The STATISTICAL. The economic factors may be designated as those which deal with the When to buy or sell question, while the statistical factors are those which concern the What to buy or sell question. The broad economic trends are studied to learn the causes, and anticipate the reversals in stock price cycles, while the statistical factors are studied to determine the industries and particular panies which appear more or less attractive at successive intervals. Economic Factors Stock prices are the means by which investors and traders appraise the effects of prosperity and depression. During periods of prosperity, when the general level of trade and industry is high, the prices of shares rise to reflect that condition. Conversely in periods of depression, the price level of shares falls to reflect the converse condition. As the economic cycle goes, so goes the trend of stock prices. Primarily, the changes in the economic cycle are caused by the relation of supply and demand for goods and services. When these factors are more or less in balance, the state of trade and industry carries on at a level often vaguely termed normal. The factors which make up the economic picture are both foreign and domestic, and cover a wide range. The average stock trader who has not had the special training of an economic background, is naturally greatly handicapped in being able to reduce the effects of numerous enonomic changes to a practical working basis for trading stocks. The economic facts which appear on the financial pages of the metropolitan newspapers are hardly sufficient for the purpose, because they are not sufficiently prehensive or related according to their importance. In bing the field of information available, the author has found that the most plete presentation of anized economic facts, in convenient graphic form, appears in the publications of Economics Statistics, Because this service appears to merit the attention of those stock traders who feel the need of concisely summarized, but prehensive economic data, which have a bearing upon stock prices, the author presents, in Appendix I of this chapter, a brief discussion of this service, which is believed to be worthy of the attention of the reader. Unless some such source of anized information is employed, the average stock market trader is probably better off to leave the economic side of the fundamental approach out of his calculations except in a very general way. Statistical Factors The investigation ot the conditions of particular industries, and panies in such industries, is the method which the fundamental student employs in selecting the best mediums for investment or speculation. This study requires trained consideration, a multitude of facts concerning the management and operation of many large and plex corporations. To reduce the information to a concrete basis, from which to make mitments, it is necessary that the financial history of the various corporations be studied. In addition, current changes must be constantly scrutinized, and recognized relations between gross and earnings, profits and losses, assets and liabilities, as pared with stock price trends, must all be carefully considered. A substantial part of this information can be conveniently charted. When the average trader starts out to master this large volume of information, he soon finds that an intelligent study of it is beyond his ability, unless the pertinent information is very briefly summarized, and the refined figures are constantly available. The outstanding service which presents the majority of the statistical factors, customarily used in connection with judging the advisabil。