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Technically Speaking, May 2012

LETTER FROM THE EDITOR

As an organization, the MTA has a strong sense of history. One of the ways the MTA chronicles the history of technical analysis and the organization is through its Annual Awards program. Individuals from the past who have made contributions to the field are honored at the Annual Symposium. This year, six individuals were commended for their work and we present small summaries of their accomplishments. We also include history in this newsletter as often as possible. This month, we conclude with a summary of the Darvas Box, a trading technique developed by Nicolas Darvas. Although better known as a dancer than a market analyst, Darvas wrote a New York Times Best Seller in the late 1950s that highlighted the value of technical analysis to the public. Technicians working with screening software can easily automate his approach instead of relying on weekly issues of Barron’s as Darvas did more than fifty years ago. This issue also offers an extract of a recent academic paper that discusses some of the topics that are

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What's Inside...

MTA RECOGNIZES SIX WITH AWARDS

by Michael Carr, CMT

At the recent Annual Symposium, the MTA recognized six individuals for their contributions to the field of technical analysis and the MTA. Three individuals – Dr. Martin Zweig, Steven C. Leuthold,...

MTAEF SPRING 2012 FUNDRAISER: TAKE AN ANALYST TO LUNCH AUCTION

by Bruce Kamich, CMT

The Market Technicians Association Educational Foundation (MTAEF) is holding an auction to raise funds for the mission of identifying and supporting educational programs in the field of technical...

INTERVIEW WITH RALPH ACAMPORA, CMT

by Ralph Acampora, CMT & Amber Hestla-Barnhart

How would you describe your job? My ‘job’ is as Partner of a company called Altaira. We are a small wealth management company that has a set of outside managers who run separate portfolios. I am...

TEN BADLY EXPLAINED TOPICS IN MOST CORPORATE FINANCE BOOKS

by Pablo Fernández

Editor’s Note: This is an extract of the paper. The full paper is available at http://go.mta.org/285 and portions are reprinted here with the permission of the author. Technical analysts focused on...

THE ORIGINAL TREND-FOLLOWER: NICOLAS DARVAS

by Michael Carr, CMT

In 1960, Nicolas Darvas published, How I Made $2,000,000 in the Stock Market, a book in which he described the Darvas Box trading method, a strategy based on weekly charts and trend following. As...

MTA RECOGNIZES SIX WITH AWARDS

MTA RECOGNIZES SIX WITH AWARDS

At the recent Annual Symposium, the MTA recognized six individuals for their contributions to the field of technical analysis and the MTA. Three individuals – Dr. Martin Zweig, Steven C. Leuthold, and Ned Davis – were honored for their life-long outstanding contribution to the development and widespread acceptance of technical analysis by institutional practitioners and individual investors. Edward C. Johnson III was the Recognition Award recipient. The Service Award was presented to Marie Penza (MTA Member Services Director) and the Memorial Award recipient was George Lane.

The Annual Award is issued to a person(s) who made an outstanding contribution to the field of technical analysis.

Dr. Martin Zweig

Martin Zweig contributed to the acceptance of market timing in the 1980s. He achieved success with an advisory service and managing money in private accounts and closed end mutual funds. His award recognizes that, “He was one

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

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MTAEF SPRING 2012 FUNDRAISER: TAKE AN ANALYST TO LUNCH AUCTION

MTAEF SPRING 2012 FUNDRAISER: TAKE AN ANALYST TO LUNCH AUCTION

The Market Technicians Association Educational Foundation (MTAEF) is holding an auction to raise funds for the mission of identifying and supporting educational programs in the field of technical analysis.

The auction will run from May 1st – 11th, and gives participants the opportunity to take a renowned technician to lunch. This is a great chance to get access to some of the top market minds, and the format of taking the expert to lunch (or a 45 minute phone call) will enable bidders to participate regardless of geographic location.

How do I meet my technician?

Winning bidders will be contacted by a member of the MTAEF staff after they have successfully won and paid for their technician. They will be provided with the contact information of the technician, who will also be given the name of the winning bidder.

How long do I have to carry out my lunch or phone meeting?

Winning bidders will

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Bruce Kamich, CMT

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INTERVIEW WITH RALPH ACAMPORA, CMT

INTERVIEW WITH RALPH ACAMPORA, CMT

How would you describe your job?

My ‘job’ is as Partner of a company called Altaira. We are a small wealth management company that has a set of outside managers who run separate portfolios. I am part of the investment committee that allocates the assets between these products. For example, we have many Middle-Eastern clients and we created an Islamic High Dividend Fund. We also have a relationship
with an Emerging Markets Fund (ETFs), etc…

I am still a ‘stock jockey’ but since we started this firm in 2008, I have spent most of my time looking at Exchange Traded Funds.

Do you look at any fundamental or economic inputs to develop your opinions?

We call our research: “Fusion Analysis” – meaning that we incorporate fundamentals, economic, and other inputs and, of course, we time everything technically.

Can you share any longer term market opinions?

Recently we have raised some cash because we anticipate a market

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Ralph Acampora, CMT

Ralph Acampora, CMT

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TEN BADLY EXPLAINED TOPICS IN MOST CORPORATE FINANCE BOOKS

TEN BADLY EXPLAINED TOPICS IN MOST CORPORATE FINANCE BOOKS

Editor’s Note: This is an extract of the paper. The full paper is available at http://go.mta.org/285 and portions are reprinted here with the permission of the author. Technical analysts focused on risk may find the information about equity premiums useful. Those interested on relative strength strategies may find the discussion on beta to be useful.

Abstract: This paper addresses 10 corporate finance topics that are not well treated (or not treated at all) in many Corporate Finance Books. The topics are: 1. Where does the WACC equation come from? 2. The WACC is not a cost. 3. How is the WACC equation when the value of the debt is not equal to its nominal value? 4. Textbooks differ a lot on their recommendations regarding the equity premium. 5. The term equity premium is used to designate four different concepts. 6. Which Equity Premium is used by professors, analysts and practitioners? 7.Calculated

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Pablo Fernández

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THE ORIGINAL TREND-FOLLOWER: NICOLAS DARVAS

THE ORIGINAL TREND-FOLLOWER: NICOLAS DARVAS

In 1960, Nicolas Darvas published, How I Made $2,000,000 in the Stock Market, a book in which he described the Darvas Box trading method, a strategy based on weekly charts and trend following. As interesting as the method is, Darvas’ life is probably even more interesting.

As he explains in the book, by the late 1950’s, Darvas was part of the highest paid dance team in show business and on a worldwide tour, performing in front of sold out audiences. Every week, he was also  using Barron’s to find winning stocks and sending telegrams to his broker as he grew his investment account from $36,000 to more than $2.2 million in about three years.

Darvas studied economics at the University of Budapest in his native Hungary. He fled the ravages of World War II in 1943 and made his way across Europe. Eventually he

To view this content you must be an active member of the CMT Association.
Not a member? Join the CMT Association and unlock access to hundreds of hours of written and video technical analysis content, including the Journal of Technical Analysis and the Video Archives. Learn more about Membership here.

Contributor(s)

Michael Carr, CMT

Michael Carr, CMT

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New Educational Content This Month

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