Customer Reviews

Smarter Trading: Improving Performance in Changing Markets

5 star:		(2)
4 star:		(4)
3 star:		(3)
2 star:		(0)
1 star:		(0)

 

 

successful trading system development requires a firm grasp of financial markets, statistics, and clever computer programming and Mr. Kaufman offers a little taste of each to his readers. The chapters on "market reality", "risk and return", "trend following" and "robustness testing" are well written and very helpful, while sections on "neural networks", "fuzzy logic", and "expert systems" are basically filler material and of not much practical use. All said, it is one of the better books on the subject.

The person who said that Kaufman does not believe in stop losses is quite INCORRECT. The whole purpose of this book is to weigh a stop loss against a possible incorrectly placed volatile sale.
If anyone trades with a regular basis they know the horror of being 'stopped out' because of volatile price swings. Kaufman helps by correclty analyzing the benefits of stops vs losses showing how mechanized systems for stops have their own pitfalls.

Kaufman's whole treatise on RISK is really worth the price of the book. Understanding risk and it's effect on your psychology is an important and very valuable treatise. Kaufman does a very good job on the subject. Also of benefit, is the Adaptive Moving Average algorithm. While this is also part of Metastock
having the formula is invaluable for those of us who want to modify it.

The weakest part is the computerized system analysis at the end is old and rather simplistic; I would not recommend it. Some of the ideas are interesting but Pardo's book is much much better.

Perry Kaufman seems like a very knowledgable technician. I think he should write more books. "Smarter Trading" is a good read, especially the discussion on stop-loss orders and market noise. The adaptive moving average is far superior to other MA's. You can skip the neural network and machine language garbage. Neural Networks are nothing more than the ultimate curve-fit.

This was a good read on trading methodology and system development. The best concept is that of the "unable" trade, which is where your system gives a buy signal but you can not get your order filled. This is a double edged sword in that you would get filled on trades where a buy was signaled, but the trade results in a loss and not on trades that would have been highly profitable. The end result is hypothetical returns that are higher than they should be. Probably why so many successful paper systems fail when applied.

Now, aside from the trading methodology which is well written, there is a lot and I mean a lot of Programming Language in the text. I don't want to take away from the concepts which were great, but if you are not planning on writing a computerized trading program you may want to search elsewhere. On the other hand, if you are working on a "Black Box" trading system, I would highly recommend this text.

I bought this book from Amazon in 1998 so I probably bought it on the basis of the only review at the time (which gave it 5 stars). It has remained idle on my shelf from the day it arrived until last week when I found reason to have a closer look into it. I was not particulary impressed. The book seems more dated than merely 10 years.

Another review mentions the " sections on "neural networks", "fuzzy logic", and "expert systems" are basically filler material and of not much practical use". I agree. I also believe that there is more filler material than that. There is, for example, a Fortran program proudly trotted out which allegedly creates a "shock-adjusted price series". I doubt that many readers would be interested in that. Also, inexplicably, the spreadsheet formulas are from Lotus and Quattro (none for Excel).

I got the impression that Perry wanted to write a book to impress others with his nerdiness, but when it came to really gritty detail (like what he might have found that actually provided an edge) either he was holding something back or he simply didn't know. All the formulas and technobabble in the world are to little avail if we ultimately cant find grip where the rubber hits the road. I haven't been able to find anything in the disjointed discussions on market noise and stoploss that I can actually apply to a practical end.

If the main value in the book is about risk management I think the material in any of Ralph Vince's books (from where Kaufman sources some of his best material) would be more insightful.

I'm sorry I couldn't be more generous, Perry.

The book covers system trading approach in a very systematic way. Additionaly the book describes some "side" issues which in turn play a cruicial role in the trading business. Recommended !

A really good book about TA. Many tools inside are useful for real-world trading. And it is also easy to read. Highly recommended !

This book had some good information, but it was clear that it was written by a rocket scientist. The book had a lot of great information, but it was not an easy read, nor did it flow well. At times, it appeared the author would contradict himself... but I'm still not sure. I'm glad I read the book, but it will not help me in my trading.

Kaufman is one of my favorite author. But in this book he seems to have an idea that stop loss is not a good thing! I really cannot agree with him. Except this point the book is quite good. But the other book by the same author contains similar contents. I would perfer the later.