Beat the Market: Win with Proven Stock Selection and Market Timing Tools

by Gerald Appel

Overview

“In this compelling book, Gerald Appel distills a lifetime of learning about what works on Wall Street into key principles of investment success. Whether you are new to the world of finance or you’re a veteran portfolio manager, you will gain from Gerald’s innovative research and his discerning insights into price behavior.”

Nelson Freeburg, Editor and Publisher, Formula Research

 

“This new book by Gerald Appel follows the rich legacy he has established over the years; it is a treasure chest of valuable advice which bestows on the reader the benefit of his decades of investment experience. It receives my highest recommendation.”

Edward D. Dobson, President, Traders Press

 

You can clearly outperform the stock market indexes and a “buy and hold” approach to investing. Leading investment expert Gerald Appel shows you how. Appel introduces The Weekly Stock Market Power Gauge that employs three specific market timing indicators that have had excellent performance histories going back as far as 1970. These timing indicators enable you to gauge the market strength and can be maintained by almost any investor in only a few minutes per week.

 

Using Appel’s techniques, you’ll learn how to forecast the likely direction of the market, and its relative strength compared with fixed income and other investments. The book provides exact buy-sell indicators, with specific signal generators and track records for readers to follow. In addition, Appel’s techniques help you identify the specific mutual funds, exchange-traded funds, and market sectors that are likely to be most profitable.

 

Simply put, Appel shows you what information you need to forecast the direction of stock prices with high probabilities of success, where to readily locate that information, how to interpret that information, and when to enter and when to exit the stock market.

• Gauge the market’s true inner pulse...
  ...and identify major market shifts in time to leverage them
• Optimize your portfolio’s blend of risk and reward
  Use proven timing models to systematically reduce risk and maximize profit opportunities
• Master powerful momentum investing techniques
  Win by going with the flow, not against it
• Select the right equities, ETFs, and mutual funds
  Objectively choose the best investments in any market environment

Product Details

ISBN-13:	9780137154524
Publisher:	Pearson Education
Publication date:	12/11/2008
Sold by:	Barnes & Noble
Format:	eBook
Pages:	208
Sales rank:	693,850
File size:	3 MB
Age Range:	18 Years

About the Author

Gerald Appel has, since 1973, published Systems and Forecasts, a leading technical analysis publication. He is legendary for his work in technical analysis and market timing, including the creation of Moving Average Convergence/Divergence (MACD), one of the field’s most valuable tools. His books include Opportunity Investing, Winning Market Systems, and Technical Analysis—Power Tools for Active Investors. His company, Signalert, with its affiliates, currently manages approximately $250,000,000 in private capital. He has trained thousands of traders through his renowned tapes, seminars, and workbooks.

Read an Excerpt

Introduction Introduction

I am going to begin this book with a promise.

I believe that most readers of this book will be able to complete it within two to three weeks. This work has been purposely left short of philosophy, fluff, and filler. Its content is dense with instruction, theoretical and actual performance results, tactics, and strategies that you can employ immediately.

If you do your part—that is, to complete the reading and to work through the examples within—you will emerge from the process with all the information you should need to become a savvy and highly successful investor for years to come.

You will learn to recognize when stocks should be bought, when they should be held, and when they should be sold. The Weekly Market Power Gauge

You will learn readily followed, easy-to-understand, and efficient stock market indicators associated with general levels of interest rates that will help you identify those periods when stocks are very likely to advance in price, when they are only just likely to advance in price, when you might just as well stay home, and when staying home with your capital is likely to be an excellent idea.

You will also learn an indicator that is designed to identify, by just one weekly indicator of stock market performance, the time when prices are likely to continue to rise for weeks—often even for months—with a high probability of accuracy. The best gains in the stock market occur when this indicator is in effect. At other times, gains tend to be more limited.

The combination of these indicators may be taken to reflect the Weekly Market Power Gauge. When the gauge is indicating unanimousstrength in the indicators you follow, the odds very heavily favor being in stocks. Low readings in the gauge suggest caution.

In other words, you will learn how and when to put the probabilities on your side—to invest when risks are the least and to recognize when risks are the greatest.

You will also learn how to build your stock portfolio—what to buy and what not to buy—and how to blend the components of your portfolio in such a way that the whole is better performing than the average of its parts, as well as how to select mutual funds and exchange traded funds that are most likely to outperform the average stock, fund, or exchange-traded fund.

I cannot promise profit on each and every trade. I can promise, however, that you will have put at your own disposal, the ability to invest objectively, to invest with a plan and strategy, and to invest, over the long term, very successfully. Demystifying the Process of Investing...

If you are reading this book, there is a good chance that you at least occasionally tune in to those television programs on CNBC, Bloomberg, or elsewhere that feature up-to-the-minute stock market reports, intermixed with streams of market experts—with sometimes up to four or even six heads at a time, and usually with a bullish bias—who agree or disagree regarding prospects for the stock market, near and long term.

Given the constraints of television time, experts are provided with one or perhaps a few minutes to succinctly stake out their positions. For the most part, Wall Street pundits tend to be optimistic—particularly corporate representatives, who, naturally, have their own stakes in expressing optimism regarding their own industries or companies, or executives of mutual funds, who are most unlikely to advise investors to bail out of the stock market.

Still, you might wonder—with all those computers available, with all those financial and technical wizards in-house, and with all that research data at hand—why so few market forecasts are in agreement, and to the extent that they are, it is usually to the effect that what has been happening in the marketplace is what will continue to happen.

Perhaps there are too many experts, too much information, too many indicators—much of which is contradictory—and too much implied need to predict what may happen in the future rather than to simply respond to what is taking place in the present. You will be learning just a few indicators: tools and techniques by which you can track the stock market—not by forecasting weeks, months, or years ahead, but simply by being able to recognize when it is time to hop aboard the train, as well as recognizing when it is time to exit the party.

The tools that you will learn are the basic tools that I employ to manage my own and my clients’ money.

Money is serious business. Other people’s money is even more serious. If you know your clients personally, the way my company tries to know its clients, you know the importance of accumulating for the time when you can no longer work, you understand the seriousness of late-life illness when cash on hand is insufficient for medical expenses, and you learn the impact of inflation on lifetime nest eggs.

I, my son, and our staff take investing very seriously. I have personally spent a good part of my lifetime studying, researching, and testing methods by which investment results may be improved. You will be learning strategies by which large amounts of actual clients’ money—and my own—are being invested.

This is not a large book. I have written it to be a serious book.

I promised a brief but useful work.

Let’s get to the chase.

Gerald Appel

© Copyright Pearson Education. All rights reserved.

Table of Contents

 

Introduction     xix

Prologue     xxiii

CHAPTER 1 Your Basic Investment Strategy     1

CHAPTER 2 Bond-Stock Valuation Models—A Key Market Forecasting Tool     7

CHAPTER 3 Government Bond Yields Compared to Earnings Yields     25

CHAPTER 4 Achieving a 92.59% Profit Ratio     33

CHAPTER 5 How to Gauge the True Inner Pulse of the Stock Market     49

CHAPTER 6 Indicator Synergy Plus     83

CHAPTER 7 Creating the Best Blends of Risk and Reward in Your Portfolio     89

CHAPTER 8 Putting Together Your Winning Investment Portfolio     105

CHAPTER 9 A Primer for Profitable Mutual Fund Selection     121

CHAPTER 10 Momentum Investing—Win by Going with the Flow     139

CHAPTER 11 The Final Word     157

EPILOGUE     163

APPENDIX Performance Histories: Five Timing Models     167

Index     177

Preface

Introduction Introduction

I am going to begin this book with a promise.

I believe that most readers of this book will be able to complete it within two to three weeks. This work has been purposely left short of philosophy, fluff, and filler. Its content is dense with instruction, theoretical and actual performance results, tactics, and strategies that you can employ immediately.

If you do your part—that is, to complete the reading and to work through the examples within—you will emerge from the process with all the information you should need to become a savvy and highly successful investor for years to come.

You will learn to recognize when stocks should be bought, when they should be held, and when they should be sold.

The Weekly Market Power Gauge

You will learn readily followed, easy-to-understand, and efficient stock market indicators associated with general levels of interest rates that will help you identify those periods when stocks are very likely to advance in price, when they are only just likely to advance in price, when you might just as well stay home, and when staying home with your capital is likely to be an excellent idea.

You will also learn an indicator that is designed to identify, by just one weekly indicator of stock market performance, the time when prices are likely to continue to rise for weeks—often even for months—with a high probability of accuracy. The best gains in the stock market occur when this indicator is in effect. At other times, gains tend to be more limited.

The combination of these indicators may betaken to reflect the Weekly Market Power Gauge. When the gauge is indicating unanimous strength in the indicators you follow, the odds very heavily favor being in stocks. Low readings in the gauge suggest caution.

In other words, you will learn how and when to put the probabilities on your side—to invest when risks are the least and to recognize when risks are the greatest.

You will also learn how to build your stock portfolio—what to buy and what not to buy—and how to blend the components of your portfolio in such a way that the whole is better performing than the average of its parts, as well as how to select mutual funds and exchange traded funds that are most likely to outperform the average stock, fund, or exchange-traded fund.

I cannot promise profit on each and every trade. I can promise, however, that you will have put at your own disposal, the ability to invest objectively, to invest with a plan and strategy, and to invest, over the long term, very successfully.

Demystifying the Process of Investing...

If you are reading this book, there is a good chance that you at least occasionally tune in to those television programs on CNBC, Bloomberg, or elsewhere that feature up-to-the-minute stock market reports, intermixed with streams of market experts—with sometimes up to four or even six heads at a time, and usually with a bullish bias—who agree or disagree regarding prospects for the stock market, near and long term.

Given the constraints of television time, experts are provided with one or perhaps a few minutes to succinctly stake out their positions. For the most part, Wall Street pundits tend to be optimistic—particularly corporate representatives, who, naturally, have their own stakes in expressing optimism regarding their own industries or companies, or executives of mutual funds, who are most unlikely to advise investors to bail out of the stock market.

Still, you might wonder—with all those computers available, with all those financial and technical wizards in-house, and with all that research data at hand—why so few market forecasts are in agreement, and to the extent that they are, it is usually to the effect that what has been happening in the marketplace is what will continue to happen.

Perhaps there are too many experts, too much information, too many indicators—much of which is contradictory—and too much implied need to predict what may happen in the future rather than to simply respond to what is taking place in the present. You will be learning just a few indicators: tools and techniques by which you can track the stock market—not by forecasting weeks, months, or years ahead, but simply by being able to recognize when it is time to hop aboard the train, as well as recognizing when it is time to exit the party.

The tools that you will learn are the basic tools that I employ to manage my own and my clients’ money.

Money is serious business. Other people’s money is even more serious. If you know your clients personally, the way my company tries to know its clients, you know the importance of accumulating for the time when you can no longer work, you understand the seriousness of late-life illness when cash on hand is insufficient for medical expenses, and you learn the impact of inflation on lifetime nest eggs.

I, my son, and our staff take investing very seriously. I have personally spent a good part of my lifetime studying, researching, and testing methods by which investment results may be improved. You will be learning strategies by which large amounts of actual clients’ money—and my own—are being invested.

This is not a large book. I have written it to be a serious book.

I promised a brief but useful work.

Let’s get to the chase.

Gerald Appel

© Copyright Pearson Education. All rights reserved.