At my first speaking engagement at an investment seminar in 1981, I was scheduled to give a workshop at the same time as Richard Fabian, founder of the Telephone Switch Newsletter.
Only four investors showed up for my workshop. Fabian drew more than 1,000. Attendees were pushing and shoving to hear what Fabian had to say.
I was deeply impressed. If I recall correctly, I ended my workshop early so that the five of us could go hear Fabian.
I was amazed. Fabian was telling investors that they could duplicate his entire market timing system -- based on whether the market was above or below its 39-week moving average -- in less than a minute per week, yet his money-management fee was much higher than the industry average. In effect, Fabian was selling his discipline in actually adhering to the dictates of his system.
The line of people wanting to sign up went out the door.
I have thought a lot about Dick Fabian in recent weeks as I monitored the performance of his newsletter, now called Successful Investing and edited by his son, Douglas.
If the younger Fabian had followed the 39-week moving average with the discipline his father was extolling in 1981, the newsletter would have issued a buy signal on March 21. Fabian the son chose to ignore that signal, however, and ended up not buying into the stock market until May 30, some two and one-half months later -- when the average stock, as measured by the Wilshire 5000 index (97199001: news, chart, profile), was nearly 13 percent higher.
Why did Douglas Fabian ignore the dictates of the 39-week moving average? On his March 21 hotline, Fabian gave eight reasons:
1. The 39-week moving-average buy signal was generated on a triple witching day, and such days typically experience heightened volatility. Market strength on such days "may not reflect the underlying trend."
2. The economy is weak.
3. P/E ratios are high.
4. Key market averages are below their 52-week moving averages.
5. Investor sentiment is bullish.
6. This isn't 1991. "Investors over the past week have been covering short positions in the hopes that we'll have a repeat of 1991's wartime rally. That would be nice, but betting the farm on what happened in the past means significant downside if history fails to repeat itself."
7. "We're closing in on the top of the market's recent trading range."
8. "We're just a headline away from more declines."
These were perfectly decent reasons, of course. But by questioning his mechanical timing system, Fabian in effect started down a slippery slope, at the bottom of which is the absence of any investment discipline.
This slope is so slippery because there always are good reasons on both sides of every investment question. Regardless of where investment advisers come down on any question, they will have no difficulty finding a whole host of good arguments to justify their positions.
In fact, this ability to rationalize virtually any position is evident in the eight reasons Fabian gave in March. Note that at least five of those eight reasons remained just as valid when he issued a buy signal at the end of May as when he used them to justify ignoring his buy signal in March.
Disciplined adherence to a mechanical strategy is what keeps us from slipping down this slope. Only in that way, the elder Fabian so vehemently argued nearly 25 years ago, can we confidently say that our emotions are not running the show.
He was right.作者: fzais 时间: 2007-11-1 20:04 我了解的所谓机械交易系统无一例外的失败了,搞这东西和制造永动机有一比。
