Trend Trading: Timing Market Tides

By Kedrick Brown

Book Overview

Written in a straightforward and accessible style, Trend Trading teaches you how to trade equity trends with sound money management discipline, from the individual stock level to the whole portfolio level. Tailored to investors who want to use elements of trend following strategies in their equity portfolios, Trend Trading presents unique investment tools and advanced technical analysis methods in simple, commonsense terms.

• Format: Hardcover
• Language: English
• ISBN: 0471980218
• ISBN13: 9780471980216
• Release Date: August 1970
• Publisher: Wiley & Sons, Incorporated, John
• Length: 240 Pages
• Weight: 0.94 lbs.
• Dimensions: 0.9" x 6.3" x 9.2"

Customer Reviews

A great book

This book gives you good techniques for trading that you can back-test for your self. The tecnniques mentioned are quite simple but the writer proved it in academic way. moreover, it helps you trust your decision be offering a foundation for why? when? and how. By the end of reading this book, I become able t formulate my own simple strategy, the rest is how much can stick to this strategy. This book does not help you in selecting the right stock, evaluating it ...etc. The main focus (which is really achieved for me) is to help you design your entry and exit points scientifically with no emotions. The only challenge I found with this book; it does not give you enough techniques for shorter term trading.

Worthwhile

I read this book over Christmas break, initially thinking that I had picked up yet another tome that amateur traders would find entertaining, but which would contain little useful information about the actual details of trading. I quickly realized that Trend Trading was no ordinary book. It is literally packed with trading details, from its in-depth explanation of trend trading and money management tactics to its exposition on the psychological experience during different stages of trading. What a privilege for us that Kedrick took the time to write this book after 8 years in the markets. A truly worthwhile read

Specific ideas for beginners and serious traders

Systems traders have long been known to employ profitable trend following strategies in the futures markets. Applying those concepts to stock trading has proven to be difficult, although the idea of trend following in stock markets dates back at least the days of Charles Dow. In a new book, Kedrick Brown, a former vice president at Knight Equity Markets, LP, redefines trend trading and offers readers a lot to think about, and readers of this book will find a large number of testable ideas. Brown reviews the basic tenets of Dow Theory, and summarizes the underlying idea as, "Dow Theory thus assumes that it is only worth owning stocks during confirmed bull markets in the major indices, and that one should be out of stocks otherwise." He also offers a straightforward definition of a trend following trading strategy as, "Any preplanned, rule-based strategy for managing open position P & L in which open profits could hypothetically grow indefi nitely under a limited set of circumstances, while open losses are limited under all circumstances." After developing a common base of understanding, Brown develops a relatively simple trend following strategy applying what he calls three dimensional technical analysis. In three dimensional technical analysis, traders need to consider not only price and time in a single stock, but they should expand their focus to similar information in multiple stocks simultaneously. In his book, Brown fully develops a sample strategy to trade any NASDAQ stock, such as MSFT. This strategy, one of many in the book, relies on an objective method of defi ning a market's trend - the binary trend identification method using Donchian bands: 1. Filter condition: Take long positions in MSFT only if the NASDAQ Composite is in an uptrend, defined as price having made a new 32-day high more recently than it made a new 32-day low. 2. Buy MSFT if it makes a new 24-day high while the NASDAQ Composite is in an uptrend. 3. Limit your losses by setting an initial fixed stop at the 24-day low at the time of trade entry. 4. If the initial stop is hit, reenter on a new 24-day high if the NASDAQ Composite is still in an uptrend. 5. Exit if the NASDAQ Composite enters a downtrend, defined by the price reaching a new 32-day low. Buy and sell decisions in this example follow the trend of the general market. The strategy manages open position P & L by limiting losses and allowing profits to run in bull markets. Interestingly, specific reentry points are precisely defined. This is often challenging for traders to do, and Brown points out that it is important to get back into positions after being stopped out if trend following in equities is going to be rewarding to traders. Other trading strategies are comprehensively developed in the book, and the reader is always given a complete understanding of the underlying principles. Brown also devotes a large portion of the book to a detailed discussion on position sizing, and provides worksheets that

Helping me make money

A great book - thank you Kedric for helping me understand the subtleties of the market!

Ex Knight Trading Pedigree

This is truly a cutting edge trading book. Unlike most "trend" books, this author has the distinction of having been a VP at Knight Trading giving him unique insight into how the market really works. Highly recomended!