Stock-market

Concise, tight and complete, the book goes directly to the point about how the stock markets work, strategies for buying (and selling) stocks, and what you can expect in terms of the work, risk and reward. This is truly a book intended for people who really invest in stocks (or plan to invest in stocks) not a book of stories about famous investors. The coverage is not oversimplified--I would say it was intended for the "intelligent layperson." (And, yes, I can point to money I made as a result of suggestions contained in the book.)

Very seldom do you find a technical book that is interesting to read. I found this book to be not only understandable to people of the profession but also to people who know very little about investing and the way the market works. The author achieved this through an ease of writing with explanations understandable to everyone and actually fun to read. I highly recommend this to anyone interested in learning more about market.

This book by Michael McDonald is an excellent one for obtaining an insight into the workings of the sometimes confusing stock market. His method of presentation makes it understandable, especially for the average non professional investor like myself.

How many people who invest in bonds really know how they are priced, or what fair value of stocks is, or how lump sum pensions are calculated? This information alone, based on stacking the money theory, is worth the price of the book.

His analysis of market timing versus buy and hold is a must read, plus learning about the Elliot wave theory and how to use it, along with contrary opinion, and if the market is in a trading range, gives you valuable tools to use in guiding your investment decisions.

Anyone new to the market, as well as serious investors who have been in the market for sometime, should have this book in their library to take advantage of McDonald's expertise and experience.

I found Mr. McDonald's work to be extremely interesting. As an investment professional, I can appreciate the considerable skill and erudition the author brings to bear as well as the straightforward, admirably lucid quality of his writing.
The author presents a remarkably attractive thesis and fully articulates it, making what could otherwise be an obtuse economic postulate a functional, successful model for avoiding the pitfalls of investing.
Above all, Mr. McDonald convinces the reader that financial markets are not governed by random, chance factors, but rather can be made profitable to investors if they can master the scientific principles that drive it. It is to the author's credit that these principles are explained with such skill as to make them understandable to the widest possible audience.
I cannot praise the book too highly, and I look forward to future works by Mr. McDonald.

"This book is about mathematical tools". That's the first sentence of Vince, who as it turns out markets his books as heavy on math. I'd bet that he never had college classes in math, or physics, or finance for that matter. His book is full of mathematical depths like explaining why 1+2*3 is equal to 7, not to 9, or giving four reasons why asterisks is the best symbol for multiplication. Another brilliant example is when he illustrates how to combine three assets with different weights: 10% of A, 10% of B, 80% of C; 10% of A, 20% of B, 70% of C, and then three more pages of other different combinations. General math level of this book is a level of B-student in the seventh grade who has never derived a mathematical formula or proved mathematical fact. Then, considerable part of the book is authors comments on trading wisdom, like "first loss is the best loss". Then, there are some ramblings on normal ditributions and Capital asset pricing theory. About 60 pages are appendices on completely irrelevant topics like he writes Black-Scholes formula, or normal distribution, or his grandiose program duplicated in C and Basic.

The "stuff" of this book, which is the so-called "f-ratio" is explained on about ten pages. You can understand it, although it is not a clear explanation. Better probably to read it where the author got it in the first place. It is difficult to say if f-ratio has much practical importance because of assumption of indefinite divisibility of trading contracts.

Most of all this book reminded me a project done overnight for a school or college class where you put a little stuff in the middle and then pad it for volume with anything you can come up with because you need to satisfy the minimum length requirement.

The problem with optimal f is that the calculation is highly dependent on the largest loss on a trade (not drawdown) experienced in backtesting. If you use optimal f and the largest loss in actual trading is greater than the loss experienced in backtesting, you will go bankrupt. Vince deals with this problem in an offhanded manner by suggesting that the actual f you use should be "padded". OK, so in the end you don't even use the actual optimal f, you pad it. And how much do I pad it by? Vince is silent on this question. So the purpose of optimal f - to decide by formula how much capital to allocate to a trade - is totally negated by the fact that you must "pad" optimal f. And you must pad it by a qualitativly determined amount because, again, Vince gives no formula on how much to pad it by. Optimal f is totally useless for system traders or any other trader for that matter.

... this book is incredible. I have a degree in mathematics and the principles expressed are extremely sound -- but far more important than the formulas are the first couple of chapters which cause you to view trading in a very different, and statistical, manner. Although the theories in this book can really only be applied to a trading system (which I haven't really used), after reading this book over several times I understand that there is a mathematical certainty that I will eventually lose my trading capital if I don't start approaching trading in a more systematic fashion. Anyway, I highly recommend it -- the sections on gambling theory alone are worth buying it.