Hi Joe - I've been wanting to comment on your effort but have not had the time before now. I've worked in finance for most of my career and I have a CFA (Chartered Financial Analyst) charter. Currently I help support an extensive software package, called Clarifi, for doing financial research oriented toward quant investment strategies.
As you must be aware, there is extensive literature on this topic. I've touched on related topics in a couple of things I've presented about J - http://code.jsoftware.com/wiki/User:Devon_McCormick/Research/HoldingWinnersSellingLosers1DataMunging and http://datarave.github.io/20150324/20150324_Devon_McCormick_Working_with_large_correlation_matrixes_using_j/20150324_Devon_McCormick_Working_with_large_correlation_matrixes_using_j.pdf . This latter is more about using J with large datasets but uses financial research examples. I've also worked off and on over the past few years on putting together a comic book for basic investing. What Brian mentions about index funds is true - they're the simplest, cheapest, best-performing investment for most people. The other key things to understand are diversification and asset allocation. Diversification aims to reduce volatility by investing in assets with low correlation - most simply, stocks and bonds. The idea behind asset allocation is to maintain target percentages of your diversified assets. Typically, this will be something like a 60/40 stock/bond allocation which you rebalance to the target infrequently, say once or twice a year. This means doing what for most people seems counter-intuitive: moving money from your better-performing asset into the worse-performing one to get back to your target levels. This is a mechanical way to sell what is pricier and buy what is cheaper. If you want to research this area, perhaps the most fruitful thing you can do is to look at correlations between returns as well as the distribution of returns. Also, with the popularity of ETFs, there may be some interesting areas of study in things like "smart beta" and "sector rotation" as ETFs are a low-cost way of achieving exposure to more narrowly-defined factors than you get with broad index investing. Here's a basic introduction to investing from Vanguard that looks pretty good: https://www.vanguard.co.uk/documents/portal/literature/investment-fundamentals-guide.pdf . Obviously, they want to sell you their funds but they do have some of the lowest cost index funds and their advice seems sound. Please keep us informed of your progress. Regards, Devon On Wed, Jan 6, 2016 at 5:44 PM, Joe Bogner <joebog...@gmail.com> wrote: > Thanks for all the feedback. I've created a small application and > posted it here: > http://code.jsoftware.com/wiki/User:Joe_Bogner/StockViewer > > I will likely improve it and will cross post to programming since > others may find qt forms with plots useful > > > > On Wed, Jan 6, 2016 at 1:53 PM, Raul Miller <rauldmil...@gmail.com> wrote: > > On Wed, Jan 6, 2016 at 1:43 PM, Brian Schott <schott.br...@gmail.com> > wrote: > >> The investment advice that caught my attention most recently is shown in > >> the 2013 PBS Frontline video below. It basically suggests to me that > Index > >> funds are better than managed funds for most people. (But my own > experience > >> with trying an Index fund has corresponded with the really flat 2015 > year > >> which has been one of the worst of late.) > >> > >> > http://www.pbs.org/wgbh/frontline/article/index-funds-the-key-to-saving-for-retirement/ > >> http://www.pbs.org/wgbh/frontline/film/retirement-gamble/ > > > > But are you "most people"? > > > > (I have been seriously questioning the competence of not only myself, > > but of the people reporting the news, as well as others. It's pretty > > clear that there are some competent people out there, somewhere, but > > they seem to be well hidden... Anyways, I am sort of dubious about a > > lot of things, recently...). > > > > As for the economy, I think it's doing what it's supposed to be doing > > (which is to say: people are getting food to eat) but beyond that, > > there have been some really bad long-term indicators, especially in > > the banking sectors. > > > > -- > > Raul > > ---------------------------------------------------------------------- > > For information about J forums see http://www.jsoftware.com/forums.htm > ---------------------------------------------------------------------- > For information about J forums see http://www.jsoftware.com/forums.htm > -- Devon McCormick, CFA Quantitative Consultant ---------------------------------------------------------------------- For information about J forums see http://www.jsoftware.com/forums.htm
