Thomas K. Carr

Market Neutral Trading, Combining Technical and Fundamental Analysis into 7 Long-Short Trading System, McGraw Hill, 2014.

Trading System Purpose:

Seek more alpha (returns)

Less financial risk

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Problem with technical & fundamental trading system, often technical & fundamental disconnect from stock price.

4 System Types

	Technical	Fundamental
Short
Long

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Templeton looks for undervalued growth;

Greenblatt’s “magic formula” buys cheap companies with a high return on investment;

the “Buffettology” approach screens for monopolies selling at a bargain;

Lynch’s focus is on fundamentally sound but undervalued stocks whose goods and services have wide appeal;

Zweig looks for low PEG ratios (price/earnings to growth) with insider buying and price momentum; and

O’Neil buys companies with strong earnings momentum, rising accumulation of shares, and new price highs.