Finding A Winning Strategy On Uk Stock Market Finance Essay - Free Essay Example

Sample details Pages: 6 Words: 1871 Downloads: 4 Date added: 2017/06/26 Category Finance Essay Type Argumentative essay Did you like this example? 1.0 Introduction Warren Buffett is considered the most successful among investment community of experts. Actually his words and deeds are treated as a golden rule by the global investors. There are two secrets of success according to Buffett: First, the long-held strategy; the second is ignore market . Don’t waste time! Our writers will create an original "Finding A Winning Strategy On Uk Stock Market Finance Essay" essay for you Create order Buffett is a model of long-term investment. When making investment choice, he never treats himself as market analysts, but as business operators. Buffett buying stocks before, do a lot of good lessons in advance, know about this stock the companys products, financial condition, future growth, and even potential competitors. One interesting point is that Buffett strongly opposed to short-term trading, saying that it is just a waste of time and money, and it will affect the operating performance of your body. Buffett said: I do not intend to buy the shares the next day to make money, I buy stocks, always assume that exchange will be closed tomorrow, 5 years before they re-open and resume trading. He warned investors, for the stock of any file, if you not sure if you can hold for 10 years, then do not even consider holding for 10 minutes. Buffett has $ 10,600,000 in 1972 to buy the Washington Post stock, and the value has been added to 9.3 billion dollars in 1999. In 27 years the Washington Post shares rose 86 times, although 27 years in the United States in the market went through ups and downs, Washington Post also had a severe shock, diving and surge appears countless times. However, the final proof of the fact that long-term and patience as Buffett has brought considerable gains. According to Buffett, the second key to success is: Ignore the market, the so-called Ignore the market is that not to read too much short-term market volatility, investor sentiment about the market not to be and not too be over sensitive on market behavior, or Image. In a word, do not be assertive in time with Mr. Market dance. Since he holds long-term investment patterns, Buffett advocates should ignore all the market, including price volatility and all market information, of course, do not bother economists, analysts, and the stock brokers proposal, as securities brokers provides some so-called views and reasons to lure investors buying and selling stocks, which investors earn fees and commissions. The report is organized as follows: It first introduces some basic rules in trading to be aware of in Section 2. Then two technical trading strategies: Momentum strategy and MACD strategy are illustrated in Section 3 and 4. Also, the implementation of these strategies on UK stock market in my model investment is explained. Finally, Efficient Market Hypothesis is briefly discussed and my results provide weak support for it. 2.0 Some basic rules in investing Here are some advices from Richard Rhodes before I enter the stock market. The first and also the most important rule to be keep in mind is that a long position is to be hold in bull markets. This may sound obvious, but a lot of people have sold the first rally in every bull market, saying that the market has moved too far. The next is to buy that which is showing strength sell that which is showing weakness. The public continues to buy when prices have fallen. However, the professional buys because prices have rallied. The rule of survival is not to buy low, sell high, but to buy higher and sell higher. So never be afraid of seemingly high prices. Furthermore, be patient. This means that when an opportunity to buy is missed, waiting for another instead of trying to catch up with the trend in a hurry. Another interesting one is that never adds to a losing trade to reach the average effects in the position. To put it in another word, for long position holders, each new buy price must be higher than the previous buy price. 3.0 Momentum trading strategy Jegadeesh and Titman (1993)s study showed that experience in the U.S. stock market over the past 3 to 12 months good or poor performance of stocks (winners or losers) in the next 3-12 months will continue to perform better or worse, the construction of arbitrage portfolios using this phenomenon (winner to buy, short selling losers) yields abnormal returns that can be sustained. This shows that changes in stock prices show a rise or decline inertia, namely, the existence of momentum effects. This phenomenon is contrary to the traditional risk-based asset pricing theory. The existence of momentum effect that changes in stock prices there is a pattern, which means the practice of technical analysis in investment has some value, its trading strategies of investors have a significant impact. The momentum trading strategies based on the momentum effects catches many market participants attention. From the investors point of view, only knowing the benefits of momentum strategies is not enough, they must also examine the profit net of transaction costs. Jegadeesh and Titman (1993) hold the view that, on average, the half-year turnover rate for momentum trading strategy is 84.8%. 4.0 Technical trading strategy: using MACD The investment philosophy hold by most people can be divided into two categories, one is the so called buy-hold, the main representative of this view is Malkiel ¼Ãƒâ€¹Ã¢â‚¬  1990 ¼Ãƒ ¢Ã¢â€š ¬Ã‚ °, contending that the stock prices are random walk and is not predictable, so the analysis is often trying to predict stock trend is not valid. Therefore the best way is to buy and hold; The second is active operational, according to this method of analysis, the trend is predictable, they or the use of fundamental analysis, or to use technical analysis, or combine the two methods together to analyze information so as to predict stock movements, which take advantage of favorable earnings trend, and also avoid the negative trend. Because technical analysis is easy to understand, simple to use, it gains popularity among the majority of active operational investors. The technical analysis moving average method is an important indicator and it is widely used. According to W. K. Wong, M. Manzur and B. K. Chew ¼Ãƒâ€¹Ã¢â‚¬  2003 ¼Ãƒ ¢Ã¢â€š ¬Ã‚ °, there are many ways to calculate the moving average. Most widely used among them are the following three ways: simple arithmetic mean, linear weighted moving average method and the exponentially weighted moving average method. The core idea of the latter two methods is to give greater weight to the prices close from now, and then two methods is based on the simple arithmetic mean method, they are actually the changed form of simple arithmetic average, the basic ideas are contained in the simple among the arithmetic mean law. To analyze the moving average trading strategy, we must first model the trading strategy, clearly they relate to the indicators, parameters and trading signals. First, the use of moving average method, we must clearly define the moving average line. Here, we directly use a simple weighting method, the first x days moving average value on the t day is: Where, I is the closing price. Second, the use of moving average method, we must determine whether the transaction rules. In accordance with the technical analysis theory, we assume that when the closing price of the upward moving average line, the value increased to above the moving average, it sends the signal to buy; when closing prices are down across the moving average, moving average value decreased to below, it issued a sell signal. That is: If and then it is a strong signal to buy on the t day. If and then it is a strong signal to sell on the t day. If then the investor should hold the position unchanged. Based on these strategies and advices, I bought BP, RBS and LLOY. And the attached excel file includes transactions in detail. The result turns out that the return on this portfolio closely resembles that of FTSE100, however, it still can not beat the market. This may be a supporting evidence for Efficient Market Hypothesis, while its effects are not that strong. 5.0 Brief discussion of EMH Efficient Market Hypothesis (EMH) originated from the securities laws of price change. By examine the securities prices time series analysis, which is combined with random walk theory, the use of the theory has been greatly developed. In 1970, the American economist Fama ¼Ãƒâ€¹Ã¢â‚¬  1970 ¼Ãƒ ¢Ã¢â€š ¬Ã‚ ° proposed the efficient market hypothesis, and thus there is a systematic summary of past research results, he propose a more complete theoretical framework. Efficient market means that in a stock market, securities prices fully reflect all the information possible to obtain or use, the price of each security will always be equal to its intrinsic value, no one can continue to reap excessive profits. The essence is that the stock price series reflect the efficiency of the relevant information (the degree of response and reaction efficiency), which requires the current stock price fully reflect all relevant information. Only when new information is received, the price wil l change. The previous days information will not lead to price changes. The amount of investors in the market is large enough to ensure fair prices, the market role of the collective production of the equilibrium price. Fama(1970) in the study of the issue, took note of the securities of two problems: First, stock price information and the relationship between changes in how that information caused by price changes; the second is related with the price of securities the types of information. Different information has different impact on the price level of securities, relevant information will be divided into three categories: historical information, public information and internal information, and according to these three defined three different levels of information efficiency of markets: weak efficient market, semi-strong efficient market and strong efficient market. From the three levels of the efficient market point of view, from weak to semi-strong efficient and effective and t hen to a strong and effective, is a progression from low to high relationship, and not vice versa. Efficient market theory is built on three theoretical assumptions: First, investors are considered to be rational, they take utility maximization as the goal, which is based on the known information for processing in accordance with Bayes rule, and thus give unbiased estimation of the market to make, so they can make a reasonable valuation of the securities; Second, in a way some investors are not rational, but because of securities transactions between them is carried out randomly, so they non-rational will cancel each other out, so the price of the securities will not be affected; Third, according to Shleifer(2000). In some cases, non-rational investors make the same mistakes, but they will be affected by the arbitrage of rational investors, which will eliminate the former on the prices. 6.0 Conclusion In the field of investment, there are some golden rules suggested by famous economists as well as successful investing tycoon to be kept in mind. This report adopts mainly technical methods to decide the right timing to buy. A bundle of large cap stocks and well-known companies are chosen. The technical strategy used here are momentum trading and MACD. The return turns out nearly to beat the market, that is, the return during the trading days on FTSE100. This provides weak support for the efficient market hypothesis.

Utilitarianism The And Influential Moral Theories

Utilitarianism is one of the most renowned and influential moral theories. The basis of act utilitarianism is maximizing utility, that is, doing the things that maximize happiness over suffering. Utilitarians reject moral codes that are based on customs or traditions given by leaders or supernatural deities because they judge the truth or justifiability of morality as its positive contribution to all beings. Both act utilitarians and rule utilitarians concur that the overall aim in determining the morality of our actions should be to create the best possible results, but they differ in their methods. However, do the methods of act utilitarianism stand up to the traditional rule utilitarian style? Per say that a person maximizes the utility of each specific action that they do, then they have maximized the overall utility that is within their power. If a person occasionally choses options that produce less positive results than other solutions, the total positivity of their actions wo uld be less than the amount of positive than could have been created. This reason is what allows act utilitarians to argue that humans should apply the utilitarian principle to specific acts, not to classes of similar actions. Act utilitarianism is the most natural interpretation of utilitarian ideals, and elaborates further into what is morally correct, as opposed to the traditional rule utilitarian style. For instance, the Ten Commandments are a set of traditional rules that focus on generalShow MoreRelatedThe Most Influential Moral Theories : Virtue Ethics, Deontology, And Utilitarianism2412 Words   |  10 Pagesthe moral criteria that we as human beings have. They are the rules of the game that are supposed to guide us through our decision making in life and how to behave to one another as part of a society. 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Antigone Essay free essay sample

Pride is not a symbol for strength, but of arrogance. It does not modify you as a powerful individual, but as a weakling with feign courage. It is not something to be proud of, for it veils you with vanity and ignorance so delicately and innocently that it betrays your conscience into thinking that it is a normal feeling that has no consequence whatsoever. An example of this infamous trap is presented in the play of tragedy Antigone, written by Sophocles himself. A character by the name of Creon was a victim of pride born from his position as ruler of the city of Thebes. It wasn’t long before he wallowed in sorrow, as pride swallowed in whole, smothering his familial views, killing his feel for care, and taking its place beside the ones he loved so. The motive by which Creon committed was a lethal mistake. His law of a deadly penalty crushed his son’s wife’s heart. We will write a custom essay sample on Antigone Essay or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page That wife, Antigone, was determined to break his law to her love’s expense. She was not content with her brother’s improper burial and of his title, the â€Å"Traitor of Thebes†. Although she was aware of his treacherous actions, she was not about to stand back and watch her own blood and flesh rot to the ground, with no recognition or remembrance. I was born to join in love, not hate- that is my nature. † (Line 590) So she was determined to become a â€Å"glorified criminal†, determined to bury her mother’s son. â€Å"I will bury him myself. And even if I die in the act, that death will be a glory. † (Line 86). Creon believed her foolish, disloyal, yet passionate and wild. He ignored her views and spit on her face, as he responded, â€Å"Go down below and love, if love you must-love the dead! While I’m alive, no woman is going to lord it over me. † (Lines 592-594) This proves of Creon’s pride, his blindness at the sight before him. He will not allow Antigone dominate his authority, which is translation for ‘I will disregard my son’s useless wife because she is a woman, a weaker being under me, not because she is part of my family. ’ As the ruler of Thebes, it is understandable that Creon takes his job seriously and sets it on his priority list. However, his worst mistake was that his family came second, if not third. He valued his proud position of head of state, and would not tolerate any disloyal act, hence his law of prohibition of Polynices’s mourn. He does not care if Polynices was, too, part of his family, merely tossed him aside because he wounded Creon’s pride. He did not care when Haemon pleaded him with his eyes and struggled to help his father notice his blunder before it was too late. â€Å"You’ve seen trees by a raging winter torrent, how many sway with the flood and salvage every twig, but not the stubborn-they’re ripped out, roots and all. Bend or break†¦ Oh give away. Relax your anger – change! † (Lines 797-800, 804) However, as ignorant as ever, Creon takes no notice of the large warning sign below his nose. So, men our age, we’re supposed to be lectured, are we? – schooled by a boy his age? †¦This boy, I do believe, is fighting on her side, the woman’s side. † (Lines 813-815, 828-829) He does not realize the severe consequences that are about to follow his mistakes. Because of the death sentence hovering and raining down on Antigone, his wife, his hero, Haemon became intoxicated with sorrow and despair. He threatened another life loss following Antigone’s potential death, a threat dangerously tossed aside. After Antigone was found hung in the bricked imprisonment, Haemon was driven to take his sword to his chest, a tragedy Eurydice, Creon’s wife, could not bear. Three deaths, three losses, three strikes and Creon was out. Too many warnings were blown his way, and was blessed with many opportunities to prevent the calamity that took place. â€Å"Take these things to heart, my son, I warn you†¦ Stubbornness brands you for stupidity – pride is a crime. † (Lines 1131, 1136-1137) Sadly, he let his brick wall made of the finest feign courage get in his way. He let his pride take control of his life decisions. Once he tried to amend his errors, he had fallen low, and it was too late. Pride had given his loved ones to death at its doorstep, and abandoned Creon like an empty shell. Pride must not be let in control in any circumstance. It disguises itself with a foreign innocence that backstabs you once you give it an ounce of trust. Antigone is the perfect example of pride empowering a ruler, who tried to rid of the pest a second too late. Would you be a proud ruler, or the ruler of pride? You decide.

Philos, Eros, Agape Love in Religion Essay Example

Philos, Eros, Agape Love in Religion Paper Philia, eros, and agape are three different Greek terms for the word. These three terms explain the different types of love a human being can acquire. Philia is a love of friendship, which is grounded in commonality. However, eros is a kind of love that seeks something from the other person or thing. Lastly, agape is the love that wills the good of the other and is completely self-giving. The meanings of these Greek terminologies, philia, eros, and agape, allow us to better understand and discuss our relationship with God and human fulfillment. In order to find human fulfillment, one must find God of Jesus Christ as well. Erotic loving is our desire for this fulfillment, which can be seen through eros. Human nature can be simply defined in our constant want and need for infinite. The infinite, for humans, is never being satisfied, always wanting more, the best, and as much as we can get of something. This insatiable drive within all of us takes us to the question of human fulfillment. Eros is not a noun but yet an action or an activity. For instance, eros is the longing and search for a significant other throughout our lives. We will write a custom essay sample on Philos, Eros, Agape Love in Religion specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Philos, Eros, Agape Love in Religion specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Philos, Eros, Agape Love in Religion specifically for you FOR ONLY $16.38 $13.9/page Hire Writer By the same token, we search for God and yearn for infinite happiness and fulfillment from God. All human beings in one-way or another seek about human fulfillment. An example of someone who struggled with human fulfillment is Augustine. Although later he became known as Saint Augustine, in his earlier years he was everything but. Augustine was very intrigued by very common materialistic desires such as worldly possessions and lust. These skewed desires enthralled his thoughts, words, and actions. Consequently, Augustine became involved in petty crimes in order to feed this idea of â€Å"love† in the materialistic world. This concept of love and desire can be further illustrated as a receding horizon; the farther you continue into the horizon the bigger and more numerous your wants become. Later on Augustine reflected upon his materialistic ways of life and made significant life changes to become the Saint Augustine he is referred to today. As exemplified, the essence of eros can have a negative outlook and has been evaluated as such by Jean Paul Sartre. Sartre attested that the human being is a useless passion due to our insatiable desires. Markedly, human beings desire to retain the infinite and that need is simply impossible. For the search for the unlimited is tiresome and unappeasable. Conversely, there is an alternate way of looking at eros. In order to have hope, God has to appear to human life as not a receding horizon but an absolute savior. Human beings long for the truth and due to the constraints of science and history, Jesus is seen in an alternate way because he is no longer limited by space or time. In this case, Karl Rahner and Saint Augustine both agree that God always initiates the relationship with human life. Namely, they asserted that we are constantly drawn to God and God is not drawn to us. Because of this, we have the option of forming a better relationship with God. Rahner said that God dispenses his grace to all human beings of every religion in and God is continually accepting. Chiefly, it is not God’s choice to accept or deny us, for that is not his matter?. Anthony De Mello describes another explanation of human fulfillment to us. He explains to us that in order to have human fulfillment, we must detach ourselves from our worldly attachments. As human beings, we allow ourselves to believe that we cannot be happy without a certain thing or person in our life. Thus, that is not correct. We completely wreck ourselves with the belief in finite things. De Mello also emphasizes that we shouldn’t not care about these things and people in our life but rather we realize that we can live without them and be intent with that. ? Besides eros being a description of love there is also philia. Philia is the love of friendship or brotherly love. This kind of love is seen most commonly between friends who share things in common. Once we seek God, we have a friendship with God. Although, God is not described by philia because it is not completely reliable due to changes in friendships in positive and negative ways, and God’s love never changes. On the contrary to philia, agapic love is God. The terminology of agape explains God’s love as it wills the good of the other. Agape is all self-giving and never asks for anything in return. When a person gives them self to God, this love is agape. Nevertheless, agape and philia types of are critical to having a strong relationship with God. ?  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The doctrine of the Trinity can be viewed as God invites human beings into the inner life of God. Consequently, the doctrine of the Trinity correlates with this topic of discussing the types of love. The idea that God is three persons, yet one essence exhibits that God revealing Godself. God not only communicates with us, but he also draws us into the Trinity. Rahner expressed that the doctrine of the Trinity â€Å"is not a subtle theological and speculative game but is about the self-communication of God. † In the final analysis, there are two models that Christian theologians have formulated in an attempt to address the question of the salvation of non-Christians. These models are the Replacement Model and the Fulfillment Model. The Replacement Model mainly represents the Fundamentalist and Evangelist churches which existed over most of Christian history. This model emphasizes the scriptures from a literal standpoint. According to the Replacement Model, in order to be saved one must be in connection with the Church. Quite clearly, the Replacement model is not very accepting of other religions and believes only Christians will have salvation. ? The Fulfillment Model represents the majority of modern day Christians. The Fulfillment Model preaches the perspective that Christians need to have dialogue with non-Christians. In addition, many Christians think it’s not fair to punish those who have never learned the religion of Christianity or even heard of it. The Fulfillment Model is a way to accommodate people of all different faiths and as long as they are moral, that they too will see eternal life with God. By and large, Karl Rahner’s ideas mostly correlate with the ideas of the Fulfillment Model. The only real difference is that he states is that other religious views are also true. The church did not accept Rahner’s view because quite simply the church thought that other religions couldn’t be true and by believing so it devalued the image of Jesus in the Christian Church. In Vatican II, the council agreed with Rahner’s except they said there was no such thing as â€Å"anonymous Christians† and that other religions cannot be viewed as ways of salvation. Moreover, I believe that the Fulfillment model is the most accurate description of how non-Christians should be viewed. I believe that all people have salvation in God because God knows and loves all human beings. Lastly, I believe that by thinking that God doesn’t save non-Christians limits the idea God’s everlasting love.