IFTAUPDATE 2014 Volume 21 Issue 22014 Volume 21 Issue 2

IN THIS ISSUE
1

President’s Report to Colleagues

3

Calendar At-A-Glance5

Member News

8

CFTe Program Updates

9

Important
Changes to the CFTe Program

9

Congratulations New CFTes!

10 Press Release: ESCTAC Courses
11 New Benefit of Membership:Complimentary Monthly Webinars

Education Lounge
12 A Tale From a Coffee Shop
18 Head and Shoulders Above the Rest?
The Performance of Institutional
Portfolio Managers Who Use TechnicalAnalysis
20 IFTA Member Societies
21 IFTA 2014 Annual Conference Brochure

Next issue: September 2014
Submission Deadlines
Education articles: August 15—
send submissions to newsletter@ifta.org
All other content: September 1—
send submissions to admin@ifta.org
Advertise in the UPDATE and reach morethan 6,950+ IFTA colleagues worldwide.
For more information, go to
www.ifta.org/publications/newsletter/.

page 1a newsletter for the colleagues of the International Federation of Technical Analysts

President’s Report to Colleagues
Dear IFTA Colleagues,
I am pleased to announce that we have a
new member within the IFTA family. The
Financial Technical Analysts Association(FTAA), from the jurisdiction of Hong
Kong, joined IF TA as a developing
society in April 2014. The IFTA board
unanimously accepted the applicationof FTAA. We welcome FTAA and wish
them success and all the best for their
future endeavors.

IFTA Conference“Unravelling the DNA of the Market“ is thetheme of the next IFTA conference. The
event will take place 9–11 October 2014, atthe Waldorf Hilton Hotel in central London
and will be hosted by STA. The organizer
has put together a list of keynote speakers
who should help us to explore some of
the underlying causes of market behavior.
To date, the confirmed speakers include:

•

•

•
•

•
•

•
•

Marcus du Sautoy, professor ofmathematics at the University of Oxford,
is an outstanding communicator andauthor of bestselling books that havebeen translated into 10 languages.
Alexander Elder, a professional trader
and teacher of traders, is the author ofseveral books.
John Murphy, former technical analyst
for CNBC, is the author of several popular
books. His work on intermarket analysis
created a new branch of market analysis
emphasizing global linkages.
Tony Plummer is the director of Helmsman
Economics Ltd and a fellow of STA.
Cyril Baudrillart, senior investment
advisor for BBSP, specializes in market
timing consulting.
David Sneddon is a managing director
at Credit Suisse.
Richard Taffler is professor of finance at
Warwick Business School. His research is
focused on the role of the emotions andthe unconscious in investment decisions.
Robin Mesch has been building
breakthrough market models for morethan 25 years and is considered one of
the world’s top minds in technical analysis.

IFTA UPDATE is a publication of the International
Federation of Technical Analysts, Inc.
(www.ifta.org), a not-for-profit professionalorganization incorporated in 1986.
International Federation of Technical Analysts
9707 Key West Avenue, Suite 100
Rockville, MD 20850 USA
Email: admin@ifta.org • Phone: +1 240-404-6508

IFTA 2014

Annual General Meeting
Wednesday, October 8, 2014
16:30 to 17:30 (4:30pm – 5:30pm)
The Waldorf Hilton Hotel

London, UK
All IFTA colleagues are invited andencouraged to attend. For further
information, contact the IFTA staff at
admin@ifta.org

I would like to invite every IFTA colleague
to this wonderful conference in London.
Those who have not registered yet shouldtake to opportunity to register soon. Apartfrom the challenging program, IFTA conferences are a good platform for meetingold colleagues and making new friends.

IFTAUPDATE 2014 Volume 21 Issue 2

page 2President's Report (continued)

Webinar Program
Since 2013, IFTA has offered webinars to our colleagues.
Our marketing director, Dan Valcu, has organized the webinars—in 2013, in cooperation with the German society VTAD,
and in 2014, with our own platform. Under Dan’s guidance,
we will be offered regular webinars with known speakers
and interesting topics. The idea of the webinar series is todeliver technical analysis content to the colleagues in thesocieties. Being one step ahead, this program should also
be used to give colleagues a platform for presenting themselves or their research. A wonderful example is Victor Hugo,a colleague from TASSA, our South African society. Victor
presented “Some Uses of Market Geometry: Time, Priceand Gradients” in May. If you are interested in viewing past
webinars or registering for future webinars, please checkwith your local society for details. If you want to apply to bea speaker, please send a proposal to our our staff. Whether
you have a research presentation or one on an educational
topic, please tell us about your idea. Finally, since webinar
registration and attendance are high and distribution isinternational, if you would like to be a webinar sponsor,
please contact us.

The Society of Technical Analysts (STA) is delighted to be hosting the 2014
International Federation of Technical Analysts’ Conference in London.
The conference will take place on 9-11th October at the Waldorf Hilton Hotel incentral London. The theme of the conference “Unravelling the DNA of themarket” will allow us to explore some of the underlying causes of market
behaviour.
Keynote speakers include:
Professor Marcus du Sautoy OBE – the Simonyi Professor for the Public
Understanding of Science and a Professor of Mathematics at the University of
Oxford. Presenter of The Code on BBC2.

I want to thank the societies for all the information about
their activities. Furthermore, I want to thank our colleagues
who contributed articles for this newsletter or who helped
to edit and produce it.

John Murphy, Dr Alexander Elder and Tony Plummer – widely acknowledged astoday’s leading experts on technical analysis and trading.
London is quite simply the most popular tourist destination in the world. It is afascinating combination of the old and the new – 21st century technology andarchitecture nestle among buildings that reﬂect the city’s 1000 year history.

I hope to see you all in London!

Delegates will have the opportunity to explore world-class museums and galleries as well as to see spectacular theatres andshows.

Best regards,

The STA looks forward to welcoming you to a fascinating conference which will include a buzzy social programme.
Come and experience all that London has to oﬀer.
Deborah Owen
Conference Director
Society of Technical Analysts

Rolf Wetzer, Ph.D.
IFTA President

For Booking and updates go to conference.ifta.org/2014

See Page 21 For Full Brochure

IFTAUPDATE 2014 Volume 21 Issue 2

page 3

Calendar At-A-Glance
Date

Topic

Host

Speaker

Location

Time

ContactMonthly

Presentations from local and international speaker on acomprehensive range of topics (e.g., sharemarket, CFDs, options,futures, FOREX trading, methodologies, money management,
psychology).

STANZ (New
Zealand)

Various

Epsom Community Centre
200-206 Gillies Ave.
Auckland, NZ

Variouswww.stanz.co.nz/

Monthly

Meetings are held monthly in nine cities across Australia.
All monthly meetings are free to members. Visitors are welcome
to attend. Bookings are not required. Visitors fee is $30.

ATAA

Various

Various

Variouswww.ataa.com.au/meetings

Monthly

Chapter leaders and their volunteer members serve as
CSTA Chaptersambassadors for the CSTA and plan social and educational events
for the area. Events include presentations by industry professionals
and technical analysis experts and peer learning gatherings.
Chapters also play a vital role in their community by connecting
individuals and promoting technical analysis.

Various

Various

Variouswww.csta.org

N/A

Queen Mary University London

18.0020.00

info@sta-uk.org

ISBF Campus, New Delhi

16:0018:00

http://www.taindia.org/Events

July

2

STA Diploma I Exam

STA

5Society Meeting

ATA

9Where We Are in the Runaway Bull Market

TSAASF

Dr. Hank Pruden

Golden Gate University
San Francisco, CA USA

15:0016:30

http://www.tsaasf.org

12

Introductory Technical Analysis Course for New Members

TASN

Membership
Committee

77B Mobolaji Bank AnthonyWay, Behind Ikeja Plaza Ikeja, Lagos

10.00

admin@tasnigeria.org

15

Summer Party

STA

TBA

British Bankers Association, Pinners Hall105-108 Old Broad Street, London EC2N 1EX

18.0020.00

info@sta-uk.org

19Monthly Meeting

TASN

TBA

77B Mobolaji Bank AnthonyWay, Behind Ikeja Plaza Ikeja, Lagos

10.00

admin@tasnigeria.org

31

Master of Financial Technical Analysis (MFTA)
Alternative Path, Session 2 application deadline.

IFTA

NA

NA

NA

www.ifta.org

9

CFTe Training

TASN

TBA

77B Mobolaji Bank AnthonyWay, Behind Ikeja Plaza Ikeja, Lagos

10.00

admin@tasnigeria.org

15

IFTA Update submission deadline for educational articles(mid-September release)

IFTA

NA

NA

Variousnewsletter@ifta.org
Attn: Aurélia Gerber, Journal Director

15

IFTA Journal applicants notification of acceptance/rejection IFTA

NA

NA

NA

journal@ifta.org

26

Market Analysis Training

TASN

TBA

77B Mobolaji Bank AnthonyWay, Behind Ikeja Plaza Ikeja, Lagos

10.00

admin@tasnigeria.org

Monthly Meeting

TASN

TBA

77B Mobolaji Bank AnthonyWay, Behind Ikeja Plaza Ikeja. Lagos

10.00

admin@tasnigeria.org

August23

IFTAUPDATE 2014 Volume 21 Issue 2

page 4

Calendar At-A-Glance (continued)
Date
September

OctoberNovember

December

Topic

Host

Speaker

Location

Time

Contact

1

IFTA Update submission deadline for news content(mid-September release)

IFTA

NA

NA

Variousadmin@ifta.org

9Monthly Meeting

STA

TBA

British Bankers Association, Pinners Hall105-108 Old Broad Street, London EC2N 1EX

18.0020.00

info@sta-uk.org

20

2014 Roundtable Discussion

TASN

TBA

TBA

10.00

admin@tasnigeria.org

11

Why Technical Analysis Provides a More Objective Rational TSAASF
Approach to the Investment Process

Greg Morris

Golden Gate University
San Francisco, CA USA

15:0016:30

http://www.tsaasf.org

2

Master of Financial Technical Analysis (MFTA) Session 2
application, outline and fees deadline

IFTA

NA

NA

NA

admin@ifta.org

8

Certified Financial Technician (CFTe) Level II Examination

IFTA

NA

Various

Variousadmin@ifta.org www.ifta.org

8

IFTA Board of Director’s Meeting

IFTA

Various

The Waldorf Hilton Hotel, London

TBA

admin@ifta.org

8

IFTA Annual General Meeting (Members Only)

IFTA

Various

The Waldorf Hilton Hotel, London

TBA

admin@ifta.org

8

STA Diploma II Exam

STA

N/A

TBA

13.0017.00

info@sta-uk.org

9-11

IFTA 27th Annual Conference:
Unravelling the DNA of the Market

IFTA & STA

TBA

The Waldorf Hilton Hotel, London

Variousadmin@ifta.org www.ifta.org

14Monthly Meeting

STA

TBA

British Bankers Association, Pinners Hall105-108 Old Broad Street, London EC2N 1EX

18.0020.00

info@sta-uk.org

15

Master of Financial Technical Analysis (MFTA) Session 1
paper submission deadline

IFTA

NA

NA

NA

admin@ifta.org

11Monthly Meeting

STA

TBA

British Bankers Association, Pinners Hall105-108 Old Broad Street, London EC2N 1EX

18.0020.00

info@sta-uk.org

15

IFTA Update submission deadline for educational articles(mid-December release)

IFTA

NA

NA

Variousnewsletter@ifta.org
Attn: Aurélia Gerber, Journal Director

1

IFTA Update submission deadline for news content(mid-December release)

IFTA

NA

NA

Variousadmin@ifta.org

9

Christmas Party

STA

TBA

British Bankers Association, Pinners Hall105-108 Old Broad Street, London EC2N 1EX

18.0020.00

info@sta-uk.org

31

IFTA Journal Web publication

IFTA

NA

NA

NA

www.ifta.org/publications/journal/

IFTAUPDATE 2014 Volume 21 Issue 2

page 5

Member News
AAPTA (USA)On March 28 and 29, 2014, AAPTA (theAmerican Association of Professional
Technic al A nalys t s) held it s A nnual
Conference and Brainstorming Sessionin Austin, Texas, USA. Approximately 30
members attended. The theme of theconference was “Practical Applications ofTechnical Analysis.”On the first day, after welcoming remarksby Ms. Tamara Trittschuch, president of
A APTA, the attendees heard a mindstretching address from Mr. Ed Seykota (amarket wizard) on “Govopoly in the 39thDay.” That was followed by “The Fold
Methodology – Symmetrically Alpha,”by Doug Johnson, CQG product specialist, and then “Back to Basics with Market
Structure: What I Learned from a 30-year
Market Veteran,” by Nigel Badhur.
The members were then treated to “TheHistory of AAPTA,” by Mike Jepson, and“Application of Momentum Indicators,” byCynthia Kase. Dinner followed at the Iron
Cactus Restaurant.
T h e n e x t d a y, M a r c h 2 9, f e a t u r e d“H a r n e s s i n g t h e Powe r of Re la t i ve
Strength for Portfolio Management,”by Mike Moody; “The Janus Factor,” byGary Anderson; and “Sacred Chickens, theHoly Grail and Dow Theory,” by Charles
Bassetti. The conference concluded witha “Brainstorm” interactive session that
included special perspectives given by
Ian McAvity.
A APTA comprises an elite group oftechnicians with seven or more years ofexperience. Membership is by invitationwww.aapta.com.

FTAA (Hong Kong)
In April, FTAA (the Financial TechnicalAnalysts Association), from the jurisdictionof Hong Kong, joined IFTA as a developing
society. Welcome FTAA!

ESTA (Egypt)
ESTA is currently in the process of signinga Memorandum of Understanding (MOU)
with Reuters. The main objective of this
MOU is to establish mutual cooperation
between both parties in order to i) disseminate technical analysis in Egypt, ii)
help Reuters to educate its clients with thetechnical analysis tools that are offered on
Reuters’ Eikon terminals, and iii) establish
and develop a strong relationship with
Reuters (as a data service provider) that will

benefit ESTA members in terms of courses,
software, and information.
A draft of the MOU has undergone review
by ESTA through a “Thomson Reuters
Cairo Focus Event” that was held on March
25 in the Clubhouse in uptown Cairo. This
great one-day event was intended to provide ESTA members and Reuters clientswith a combination of technical analysis
outlook, market insight with the innovative workflow tools in Eikon 4, and parallel workshops with special focus on certain asset classes to maximize the Eikon
experience.
The event started with registration, followed by an opening note from Mr.
Aaron Fairchild, head of desktop sales,
MENA, at Thomson Reuters. Then, Mr.
Mohamed Ashraf, CETA, CFTe, MFTA, and
ESTA board member, presented a technical analysis session titled “The Relative
Strength index as a trading tool and a market trend identifier”. After the coffee breakand some games for the attendees, twoparallel workshops were offered: “Seeking
Alpha in MENA Markets” and “FX, Money
Markets and Fixed Income”. At the end of
the event, some gifts and rewards were
distributed to the attendees.

Aaron Fairchild, head of desktop sales, MEN,and Dina Mostafa, cross asset specialist, MENA,
in Thomson Reuters distributing gifts to theattendees.

Mohamed Ashraf, CETA, CFTe, MFTA, is givinga lecture titled “The Relative Strength index as a
trading tool and a market trend identifier”.

Workshop titled “FX, Money Markets and Fixed
Income”.

IFTAUPDATE 2014 Volume 21 Issue 2

page 6

Member News continued

IEATEC (Spain)
IEATEC (Instituto Español de Analistsas
Técnicos y Cuantitativos), the new spanish technical analysts society, made its
official debut on March 13 in Madrid. The
event was hosted by Abante Asesores andattended by representatives from the main
financial institutions as well as banks, brokers, and fund managers, who welcomed
the presence of a society that can encompass all the technical analysts that currently
work in Spain.

Some of the candidates playing games during
the break.

Speakers from IEAF (Spanish Financial
Analyst Society) and IEATEC highlighted
the importance of association and certification in every field of financial analysis andresearch as a means of guaranteeing thehighest level of quality and ethics whenmanaging and advising clients, especiallywhen a host of new regulations is being
passed in many countries. Another theme
was the increasing role of technical analysis
in today’s research and management, andthe need to increase education and provide
the market with the necessary tools for
its development. After the presentations,attendees spent some time networking
and sharing market perspectives.
IEATEC is sponsoring a new course to prepare for the CFTe certification that will startin May at Escuela FEF, and is currently inconversations to implement in-company
certification programs for several banks
and brokers.

Workshop titled “Seeking Alpha in MENA
Markets”.

Mr. Carlos Jaureguizar,
president of IEATEC,
gave a speech on theevolution of technicalanalysis since its origin
in Japan in the 17th century and in the UnitedStates since the early
20 th century.

Mr. MiguelJaureguizar, Secretary
General of IEATEC,
addressed the attendees to explain theroles of IEATEC andIFTA in the financial
markets associations
landscape.

Mr. Javier Méndez
Llera, Secretary
General of IEAF,
gave a lecture on therole of the technicalanalyst as a memberof the financial analysts' community.

Mr. Enrique
Borrajeros, head of
business development
in Abante, host of thepresentation, spokeon the importance ofcertifications such as
CFTe.

A full auditorium attended IEATEC's
presentation.

The presentation of IEAF marks the start of aseries of Technical Analysis meetings in Spain,
where professionals from the field meet to
exchange ideas and network .

(left to right) Mr. Miguel Jaureguizar, Secretary
General of IEATEC; Mr. Javier Méndez Llera,
Secretary General of IEAF; Mr. Javier de la Parte,board member; and Mr. Carlos Jaureguizar,
president of IEATEC.

After the presentation, the attending public
enjoyed some networking time to share market
views and ideas on the development of the fieldin Spain.

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IFTAUPDATE 2014 Volume 21 Issue 2

page 8CFTe Program Updates
The IFTA Education Committee recently
made significant changes to the CFTe syllabus and exams. These changes will be
implemented starting with the upcoming
level I and level II examinations beginningon October 1.
Edwards and Magee remains the core reading for the CFTe level I exam. We haveadded some chapters from the book andwill be giving it more weight than before.
We have omitted a few chapters from
Murphy’s Technical Analysis of the Financial
Markets but kept some important topics,
such as philosophy of technical analysis,volume and open interest, and cycles. Notethat questions regarding cycles in the levelI exam will be from Murphy’s chapter on
this subject.
A new book was added: Technical Traders
Guide to Computer Analysis of the Futures
Market, by Le Beau Charles, Lucas David.
This is a very important book, as it deals
with indicators and oscillators as well as
to system building. Questions on oscillators and indicators will be from this book.
We believe Le Beau’s book is one of thebest books written on this subject andthat it will greatly benefit candidates. We
recommend that candidates study thisbook thoroughly.

Nison’s Candlestick Charting Techniquesand Du Plesis’ The Definitive Guide to
Point and Figure are the core readings for
Candlesticks Charting Techniques andPoint and Figure, respectively. We havealso retained some important chapters
in Pring’s Technical Analysis Explainedthat we believe are a must read for every
candidate.
Last but not least, candidates arerequested to study the additional material posted on the IFTA website, including:• Elliott Wave Principle, written by Mohamed
ElSaeed, CFTe, MFTA. Mohamed is thecurrent president of the Egyptian Societyof Technical Analysts (ESTA).
• Breadth Indicators, written by Tamer
Gamal, CFTe, CETA. Tamer is the pastpresident of ESTA.
• Point and Figure, written by Mohamed Younes
CETA, CFTe. Mohamed is a member of ESTA.
As for the CFTe level I exam, we have madesignificant changes to old questions andadded many new questions. The questions mainly deal with understanding theconcepts of Technical Analysis. Candidates
must have a good grasp of the concepts
and psychology. To make things easierfor candidates, we will be publishing amock exam with about 60 questions thatare similar to what you will see in the final
exam. (Note that the exam consists of 120
multiple choice questions.)
Regarding the level II exam, Edwards andMagee, LeBEau, Du Plesis, and Pring are
the same as level I. We have, however,replaced Nison’s Candlestick Charting
Techniques in level II with his second book,
Beyond Candlesticks, which is an excellent
book that introduces lots of psychology
while explaining the formations. In addition, the book contains the three Japanesecharting techniques: Three line break,
Renko, and Kagi charts. Expect to seequestions on these subjects in the exam!
W e a d d e d H o w a r d B a n d y ’s b o o k
Quantitative Trading Systems, practicalmethods for designing, testing, and validation. This book will benefit candidates,
as it deals with system construction andoptimization.
Prechter’s Elliott Wave Principle: Key tomarket behavior is the core reading on
Elliott Wave for the CFTe level II exam.
We also added some important chaptersfrom Kirkpatrick’s Technical Analysis: thecomplete resource for financial market
technicians.

One of the newly added books is
SteidlMayer on Markets. Trading with
Market Profile. Questions on this subject
will be easy and direct, but we recommendthat candidates not skip this book! The
core reading on cycles for the level II examis Brian Millard’s Future Trends from Past
Cycles. Questions on this subject will also
be direct.
In addition to these books, IFTA will upload
on its website additional “core” readings:• Ichimoku Kinko Hyo, written by Yukitoshi
Higashino, MFTA, who is the directorof the Japanese Society of TechnicalAnalysts (NTAA).
• Relative Strength Analysis, written by
Mohamed ElSaeed, CFTe, MFTA. Mohamed
ElSaeed, CFTe, MFTA. Mohamed isthe current president of the Egyptian
Society of Technical Analysts (ESTA).
In addition, reading material on quantitative and behavioral finance are currently
being written by Dr. Rolf Wetzer, IFTA
president. If the material is not finishedduring June, we will postpone it to thenext exam.
As for the CFTe level II exam, the firstquestion will consist of two main parts.

IFTAUPDATE 2014 Volume 21 Issue 2

page 9CTTe Program Updates continued
The first part is an analysis of a market index withdifferent timeframes and indicators. The candidate
will be expected to make a sound analysis, showing
major, intermediate, and short-term trends; important
support and resistance levels, signs of strengths,
and weaknesses on price charts; and indicators, aswell as a clear strategy on what to do and how tomanage money.
The second part of the question will contain chartsfrom different markets (e.g., commodities, equities, bond, yields, FX), and the candidate will be
expected to analyse these markets based on theirrelative performance “RS Analysis”, and on theircharts and indicators. Candidates will decide what tobuy, hold, and sell and will assign weights as if they
are constructing a portfolio. Note that there is noright and wrong here, it all depends on your analysis
and the sound rationale you present to back up yourdecisions. Question 1 (including both the first andsecond part) will encompass 40 points

Important
Changes to the
CFTe Program

Syllabus and Study Guides
CFTe Level I (offered all year long) and CFTe Level II(offered biannually in April and October) candidates
should study the current Syllabus and Study Guide for
CFTe Level I and CFTe Level II for any exam taken
through 30 September 2014, and the new Syllabus andStudy Guide for any exam taken on or after 1 October
2014.

Section two of the exam will involve of six essay
questions, with each question consisting of three orfour sub-questions. Candidates will be required toanswer two sub-questions from each main question.
Section two will encompass 60 points.

Languages
Effective 1 October 2014, the CFTe I will only be available in English, German, and Arabic. The CFTe II will
be offered in English, German, Arabic, Italian, French,and Spanish through 8 October 2014. After this date,the exam will only be available in English, German,
and Arabic.

We wish all candidates good luck.

Why Certify?

The IFTA Education Committee

Obtaining the CFTe or MFTA designation(s) demonstrates that you have achieved the highest level ofexpertise in the field of technical analysis. Join an elitegroup who have already recognized the importanceof these certification(s) in elevating their professional
standing by becoming certified by the International
Federation of Technical Analysts.

Congratulations
New CFTes!
Poh E-Shawn Alvin (TASS)
Wael Mahmoud Amhaz (LSTA)
Muhammad Akmal Ashraaf (STA)
Magnus Berchtold (VTAD)
Carlo Edward U. Berroya (TASS)
Tarry Lim Sun Chin (TASS)
Lee Chun Wei Clarence (TASS)
Tobias Dietl (VTAD)
Marian Leonard Dilirici (AATROM)
Vincenzo Fico (SAMT)
Mohamed Filali (STA)
Antoine Fraysse-Soulier (STA)
Peter Ganglmair (Non-Member)
Kypros Hermes Georgiou (STA)
Andrei Hangan (AATROM)
Siraj Hudda (ATA)
Philip Morgen (VTAD)
Alfonso Morte Ezquerro (Non-Member)
Zainal Ariffin Osman (STA)
Richard Allen Perry (STA)
Deepak Pimplikar (ATA)
Yuri Rabassa (SAMT)
Carsten Riedel (VTAD)
George Rowe (STA)
Mohammad Turki Said (STA)
Martin Stappert (VTAD)
Ralf Stock (VTAD)
Christian Sutter (SAMT)
Anand Vishwanath Thalange (ATA)
Maik Thielen (VTAD)
Frank Voelker (VTAD)
Wan Daim Jumuatullail Bin Wan Yussof (STA)
Ben Wiseman (ATAA)
Sandro Zwyssig (SAMT)IFTAUPDATE 2014 Volume 21 Issue 2

page 10

Press Release: ESCTAC Courses

Based on the strong relationship between
the International Federation of TechnicalAnalysts and the Emirates Securities andCommodities Authority (ESCA), we proudly
announce the ESCA Training Center official training plan for year 2014. This plan
provides a bouquet of specialized training
and professional qualifications programsin capital markets and investment sectors.
The training programs are offered in Arabic
and English in cooperation with prestigious
international institutes, qualification bodies, and experts.
The plan includes a variety of preparation
courses for the qualifications-led licensing regime for CISI exams. It also offers

Programs

Location

Date

Month

Price (AED)

Selection & Analysis of Investment Funds

Dubai

15–17

April

2500

Global Securities Exam Preparation–CISI

Dubai

19–20

April

3500

Certified Technical Analyst CFTe–Level I

Dubai

4–8

May

5000

international qualifications programs
such as “Accredited Financial Analyst”
and “Chartered Wealth Manager” by
the American Academy of Financial
Management, in addition to the start of
the first official preparation course for the
Certified Financial Technician CFTe  I,amongst many professional certificatesand programs.

Tools & Products of Derivatives in the
Capital Market

Dubai

18–19

May

2500

Operatonal Risk Exam Preparation–CISI

Dubai

17–28

May

3500

Understanding Warrants & Installments

Dubai

11–12

August2500

Trading Securities

Dubai

19–20

August2500

Corporate Goverance, Compliance,
Inspection and Ethics

Dubai

27–28

August2500

Subscription: Process and Mechanism

Dubai

15–16

September

2500

It is worth noting that this is the first official
SCATC public training offering that targets
key stakeholders, such as capital market
and commodity professionals, investors,
and all interested parties inside and outside the UAE. The training program fees
are reasonable and affordable.

Islamic Captial Markets: Pathway to a
Successful Structure

Dubai

29–1

October/November

2500

Certified Technical Analyst CFTe Level I

Dubai

26–30

October

5000

Certified Wealth Manager

Dubai

2–6

November

5000

Accredited Financial Analyst

Dubai

23–27

November

5000

Project Management Institute

Dubai

7–11

December

5000

IFTAUPDATE 2014 Volume 21 Issue 2

page 11

WebinarSponsorship
Opportunities

New Benefit of Membership:Complimentary Monthly Webinars
Through our continuous efforts to bring global technical community closer as well as offer further accessibility to renowned TechnicalAnalysis experts worldwide, we have launched a new series of IFTA-hosted webinars that are held on a monthly basis. These webinars
are offered exclusively to all members of IFTA-affiliated societies around the globe. Your local society will forward you the details
when they become available. If you would like to view past webinars, please check with your local society for the access details.
Please note: the logins passwords change monthly. Here is a list of past webinars:

2014
5 JuneIdentification of High Probability
Target Zones
Andrew J.D. Long, MFTA
Publisher and Editor, Triggers$.com,
Canada20 MaySome Uses of Market Geometry: Time,
Price and Gradients,
Victor Hugo, Director, Hugo Capital;
President, Technical Analysts’ Society ofSouthern Africa (TASSA), South Africa
7 May
Price Projection Methods (73.6 MB)
Connie Brown, CMT
Founder, Aerodynamic Investments, Inc.,
USA

2013
25 AprilMulti Market, Multi Timeframe Trading
Philipp Kahler, Sr
Quantitative Analyst, Intalus, Bremen,
Germany

24 July
The Law of Vibration: Natural Patterns
in the Economy and Financial Markets
Tony Plummer Sponsored by:Vereinigung Technischer Analysten
Deutschlands e.V. (VTAD—Germany)

25 March
Optimization of Trading Strategies:
The Search for Stability and
Performance
Philipp Kahler, Sr
Quantitative Analyst, Intalus, Bremen,
Germany 201312 March
From Technical Analysis to Algorithmic
Trading
Philipp Kahler, Sr
Quantitative Analyst, Intalus, Bremen,
Germany

We currently offer the opportunity
for financial organizations to sponsor these webinars in return for an
exposure to members of over 29 IFTAaffiliated societies worldwide (traders, portfolio managers and analysts).
Through our comprehensive IFTAwebinar benefit program, sponsors
benefits will include:
1. The opportunity to include yourlogo on promotional emails.
2. The opportunity to present yourcompany logo at the start of thewebinar.
3. Receive access to live broadcast ofwebinar (limited to 5 individuals).
4. The opportunity to distributepromotional material related toyour organization as well as therecorded webinar to members of 29
IFTA-affiliated societies worldwide.
If you are interested in sponsoringan IFTA webinar, please contact IFTA
staf f at admin@if ta.org for moredetails.

IFTAUPDATE 2014 Volume 21 Issue 2

page 12

Education Lounge
A Tale From a Coffee Shop
By Mario Kfoury, CFTe (MSTA)

A light breeze was carrying the fresh
fragrance of newly opened spring buds
floating in the air, as if to tickle the olfactory senses, awakening them to the simple
beauty and pleasures of life, while thesun was settling down across the horizon, reminding us of another day goneby, another page turned in our personal
history… As I strolled down the narrow
streets and alleys of the city’s center, a
map in my hands, looking for a quiet place
to disengage, I couldn’t stop pondering,
being the technical analyst I am and having
the second nature that comes with it, thelittle details, subtle things along my way
that are indicative and predictive of certain meanings and values and precursors
of coming changes, some sort of crowd
psychology. Every city has its own story,
history, and architecture revealing a lot
about the people that inhabit it, reflecting
the neuronal order or chaos, organization

or disorganization that sprang and settled
in their minds a long time ago due to themyths, legends, and stories they adopted
as their collective archetypes, and consequently founded their religion, culture, andcivilization. Like the financial chart on myscreens, the map in my hand was yielding
a treasure trove of information, dependingon whether we’re living in the pragmatic orexistential modes and levels. As I ushered
open the door, the atmosphere was warmand serene in that coffee shop, which
offered comfortable couches and pleasant music. The speakers were filling thespace with the deep, voluptuous voice ofEmeli Sandé in her majestic song “Clown.”
A moment later, my favorite smoothie inhand, I sunk into a
thick comfortablecouch, took a deep
breath, and closed
my eyes, savoring

the moment. I had just avoided a big
loss, having escaped a bull trap in oneof the indices and, only after a coupleof restless days and nights, was able toreverse my positions at the right levels
and time, turning a loss into a profit thatdeserved a little break, a moment of selfreflection. As far as I can remember, thiswas the path I chose, for when at 16, myfather came to ask me what I wanted to
do after school and heard my reply—aviation pilot—his immediate response was:“You will study to become a doctor orwork as a garbage collector.” Two years
later, after finishing school, I cleaned out
my savings account, packed my bag, andlanded in Los Angeles, California, witha couple thousand dollars in my pocket,
odd jobs in perspective to pay my physical education tuition, perfect my jab, face
my fears, and test my will in boxing rings.
Chance later brought me to real estate
and then aviation, when I had the time

IFTAUPDATE 2014 Volume 21 Issue 2

page 13

Education Lounge

A Tale from a Coffee Shop (continued)

and money, and I wouldn’t have done
it any other way, because nothing
matches walking the unbeaten trails
and drawing your own print in earth’s
dust and mud, where we all comefrom... We spend half our life beingtaught what to think, do, and say, andif we’re lucky, the other half trying tounlearn it in order to realize our true
self and our true potential and find
our way back to what we were destined to be. I was lucky enough not
to have wasted all that time from the
beginning and was very glad to havechosen trial and error and sweat andblood over the comfort and safetyof my home or some alluring wall
diploma. Having survived the streetsof Beirut, LA, and NY and completed
my formal education in boxing gyms
and weight rooms, I had developed
a certain resilience and durable disposition and tolerance, most necessary, I discovered later, for the stock
market. All this is history now andfades to pale next to my latest trials and tribulations, for which I owe
my survival to an endless, insatiablethirst for learning and as well, a little
shiny star in the dark skies.
A young teenage couple was holding hands, kissing each other withtender love and care, the boy showing his mate a lot of attention andrespect, not like some macho guys

who feel compelled to act arrogant
and superior according to certain cultural and social molds or because ofdeep ingrained fears or insecurities
brought about from the beauty andfreedom of an educated, independent woman. Man’s best pastime
has always been war, while woman’s
has been love and life giving. History
is supposed to be a springboard to
the future, not some self-glorifying,self-gratifying, boasting, ruminating
station and proxy for war, cult of thepersonalities, and aggressions. Yet
more often than not, it ends up being
misinterpreted, misunderstood, andmisused. No violence—physical orotherwise—has ever brought justiceor a solution to a problem, yet stories
and myths of illusory glories and transient victories still abound in history
books and create in the individual a
sense of self-importance, chauvinism,and bigotry. I discovered later that
we are our own worst enemy; that life
is an individual battle between one
and oneself and not an organized collective of one against others; that webuild egos and social masks as scarecrows to deter; that we are scaredand insecure from the inside no matter how we appear on the outside;that most of the blows we receive are
merely bruises to our egos but also
life’s gift for progress and advancement in one’s perpetual journey; that

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IFTAUPDATE 2014 Volume 21 Issue 2

Education Lounge

A Tale From a Coffee Shop (continued)

a lot of the superstitions around stem fromour own projections on others; that somepeople cultivate ugliness over beauty ina defensive, preventive way; that the pen
is mightier than the sword, and whoever

beard, but it wasn’t until he turned as if
to excuse himself that I was able to recognize who he really was! “Hey! It is good
to see you here again, mister” he said withthat nagging smile, “Where is your trading
hardware?” “HeyPythagoras,
good to see you
too, it’s a welldeserved day off today. How have you
been?” I shot back returning his smile,
knowing from my previous meeting thiswill not be a fortuitous encounter andnothing is left to chance with this guy.
“Well, you know me, satisfaction is themother of content,” he said lightheartedly.
“Do you mind if I share that place withyou?” I was pleased to see him again, andas he pulled up a chair and settled down
across from me I followed, “You know, it’s
been hard the past couple days. I lost andrecovered a significant sum of money but
ended up with a nice little profit, so I wentout to blow off some steam.” “Tell me
about it, would you care?” he said, while
putting down his cup. I looked at him withbewilderment and amazement; a lot ofstrength and wisdom was emanating fromthis man, not in terms of brute physicalforce but from within, from a sense ofknowledge and understanding. “It was abull trap, I fell victim to my own greed andover-confidence and a sequence of flawless trades” “Hum, trading is a ver y
rewarding yet unforgiving discipline; If you
overtrade you burn yourself, and if you“...life is a gift and a cycle...”kills in the name of God is the enemy oflife and of its designer because life is a gift
and a cycle, and they would be guilty ofinterrupting it; and that the fundamental
cultural differences lie between the sterile
search for morals and meanings on theexistential level and the search for universal values and ethics on the pragmaticone, which leads inevitably to assuming
responsibility based on the golden ruleof consensual reciprocity, equal genders
rights, freedoms of thoughts and expression, respect for others, and any othercreature that crawls the earth because
every organism movable or immovable
has a purpose.
As my train of thought was dwelling over
all those places, my couch quivered likesomeone just bumped into it; as I opened
my eyes, emerging from my contemplation, a guy in his mid-50s, Kangol cap over
his head, a steaming beverage in hand,
was just passing by, and I could see fromthe hind of his back, a tall emaciatedshape and a gait that felt familiar. He also
displayed a ponytail and an unshaven graypage 14

don’t, you lose the touch, you have to balance between the markets and your personal life.” Two young women with Fibs
proportions passed us by, looking for aplace most probably to settle down andunload their secrets (one can tell from theirapparent verve and complicity); we lookedat them together in appreciation. “Balanceis a very elusive word, Pythagoras. It is
more like tightrope walking nowadays.”“Balance is very important, Mario; everything in life is Karma, fractals, and proportionality. As for the effects, the causes goback in time, and our genes as far as ourancestors and creation. Everything in thisuniverse is a manifestation and distributionof the element of love, the fifth element,
according to a cosmic balance sheet. And
don’t forget, trading is a three-leggedstool: technical analysis, money management, and psychology, the latest by far
being the most impor tant.” Oops, I
thought, I knew it was coming, let’s see
what he got in his bag this time… “Youhave to know yourself, dude. Do you use
a checklist?” “I do, but sometimes I feelcompelled to ac t out of boredom or
excitement.” “Yes…overtrading is one of
the most recurring mistakes in the markets; patience is a virtue, delayed over
immediate gratification and, most importantly, selectiveness according to the highest standards and criteria. This is why oneof the foremost and vital tasks in everything is to know your true motives. Why
do you trade?… most of the time we doanything in the absence of better choices,and end up messing up. This world is spinning, and all this activity around is thesearch for love; attention by acknowledgment and validation, everybody wants tobe right. The market depicts all this activity, and that is the captivating thing about
it, especially when it is translated into
something concrete—money, which is
nothing else than a conventional reward,
a substitute to gauge and measure humanlabor and activity. In a psychosomaticworld operating on ideas, myths, andbeliefs, the real token, the real currency
is attention in our daily interactions, andthat implicates our five senses on the neurovegetative system. Once our five senses
are balanced and moderated, they awaken
the sixth sense, which is intuition. You’ve
got to clear your mind before you trade.
It is as you said, like tightrope walking, afine line but between antagonists, mainly
our anima and animus, selflessness versus
selfishness, objectivity versus subjectivity.
Trading with high expectations can bevery dangerous. In this current macho
world run by men; woman is the mostsought after and desired of God’s creation, which is why any culture that does
not respect this universal principle isdoomed to remain unbalanced, dysfunctional, and aggressive, even though it
might pretend otherwise and lay theblame on others or some conspiracy theory. You can measure the level of peacefulness or conversely, aggressiveness, in a

IFTAUPDATE 2014 Volume 21 Issue 2

Education Lounge

A Tale From a Coffee Shop (continued)

culture by the presence of emaciatedwomen and the proximity of birds in thecities. Demography is a culprit, mixed withspiritual greed on the existential level
called religion, everybody wants to be like
God and achieve immortality, and it all
falls in the biogenetical greed and emotional immaturity; parental authority
replacement. Voltaire, one of the brightest
intellectual minds of the enlightenment
era, said “God is a comedian playing toan audience too afraid to laugh.” People
live in the mode of “having” instead ofthe mode of “being nowadays,” having
an extra eternal life, having a docile wife,
a big car, big bank account, a house…
Religion is not only the opiate of themasses but of the fear of death, and themore the fear is repressed the moreaggressive and violent the outcome by
implosion or explosion. All these do’s anddon’ts generate a lot of frustration, repression, and neuroses. Instead of accepting
and assuming responsibility for life’s natural cycle, they choose to live in denial. No
society is balanced without the free feminine element, yet man invented a longtime ago the apple myth to control andmanipulate the woman by burdening her
with the guilt complex.” James Brown was
now playing the famous song “It’s a man’sworld” in an unequivocal play of synchronicity. “You know Mario, women are better
traders than us. If you teach a woman how
to trade, she will set her mind to makeenough money for her next Louis Vuitton

page 15or Chanel acquisition,” he said laughing
kindheartedly, “They have a stronger psychology. There’s a science called proxemics which defines the space and distancein every culture with regard to people’s
daily interactions, just like the price andtime axis on the chart and the divinegeometry for which the 45 degree angle
is the center of gravity. People swing andvibrate around these distances dependingon their need for attention; likewise, thisangle in the stock market portrays all theactivity and volatility around it and thechaos happening in the world nowadays
because of disparities in cultures anddemographics. The Internet and userfriendly platforms introduced new participants from various cultural backgrounds
and time and money expectations, andthus changed the paradigms and parameters of the market, not to mention highfrequency, robotic, and algorithmic trading. Just like climate change, volatility ishere to stay, and their main causes are
man-made, discrepancies in cultures andbiogenetical greed and demography, thelatter being the most lethal to the planetby far. In the 18th century, Thomas Robert
Malthus warned of its dangers but was
treated as a beast and unhuman, it justgot worse in our time. If one person can
generate a number of problems and inflicta degree of damage to the environment,
two, three, and five individuals will multiply
these problems and damages exponentially, and that level is neither manageable

nor reversible in the short term. But politicians and people in decision-making roles
prefer to live in denial and not addressthese problems in a frontal manner but
rather apply Botox therapy. The Internet
and global communications have openeda Pandora’s Box for which the world was
not prepared. Take the time to relax man,to replenish your resources and balance
your physical and mental states before
you trade. The center of gravit y lies
between your feminine and masculine
provinces.” As I swallowed my pride andhid my shame knowing I was guilt y ofwhat he was talking
about, I utteredthese words, “Buth o w d o w e o v e rcome, transcend thisentire complicated situation!” “We cometo this life with a predisposition of what
is popularly identified as determinism andthen a free will, but it is actually a bookhalf-written, and a pen life endows us with,you have the ability to complete, re-write
the story, and here lies the difference
between fate and destiny. You are a freeperson with your own choices and responsibilities—assume this responsibility. May
I ask you what system you use while trading, for example?” “I use Dow theory,
Elliott wave, and sometimes Ichimoku forquick evaluation but Gann for execution”“Elliott wave is very nice in theory, in an

exemplar y world; it depic ts a humanbehavior that occurs sometimes in practice, sometimes not. Unfortunately no two
Elliotticians agree on the wave structures,
so it is like a Rorschach test most of thetime—not very clear and very subjective.
The error most technicians make is to force
the count on every market and every timeframe. Yes, there are long and short waves
in the market but their count, construction,and configuration are at times arbitrary
and do not fit the perfect graphic. The“You are a free person with yourown choices and responsibilities—assume this responsibility.”
anatomy and rhythm of the market havechanged with the inflow of capital fromdifferent cultures that have various behavior models, and therefore, reactions toevents not to mention again robotic HF
machine psychology trading. In a fast moving and unpredictable market, you needa simpler system and to constantly reassess yourself and expectations. There arethree phases in the markets: accumulation,
participation, and distribution—you know
where you want to be.” “You know, that’seasier said than done. After a while we
get addicted to the market, we miss theadrenaline when we don’t trade.” “I know

IFTAUPDATE 2014 Volume 21 Issue 2

page 16

Education Lounge

A Tale From a Coffee Shop (continued)

what you mean. people criticize the likes
of Soros, Buffett, and Gates because of
their considerable accumulated wealth,but remember all these shrewd investorsbought when everybody was fearful andsold when everybody was confident, andthey forget that these people, although
not always for the best philanthropic incentives, have contributed to more good than
all the synagogues, churches, and mosques
combined with no stains of blood on theirhands. I am not saying that we should be
condoning the ruthlessness of capitalism
nor the oppressiveness of communism,
but rather what I am implying is that weshould start seriously thinking about a new
system and a new way to manage ouraffairs on this very precious planet, some
sort of social capitalism or capital socialism
based not on Karl Marx’s or Adam Smith’s
extreme ideas but on mending the gaps
between them—wage disparities, equal
gender, and humans right—and providing
basic needs to every human being according to the United Nations charter within
the respect of our planet and its ecology.”“But all this is massive Pythagoras, titanic!”“The alternative my friend is Titanic; people bicker over details and take part insenseless debate about who is right and
who is wrong and confuse the form for thecontent of the messages. Take creationand evolution, for example. They feel compelled to take a stand regarding this orthat, but what is the big deal if there wasone or the other or both at the same time,some sort of creative evolution or evolutionary creation. Do they really think thecreator needs their help and assistance,or would they rather that they need to findthe right path to be just, virtuous, andpeaceful in this world, by their own means
and merits? Everybody is confusing theform for the content like an egg andchicken riddle and getting drawn in a
puddle of water. The purpose of life is torealize your humanity by balancing yourself
between opposites on the 45 degrees
angle.”

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As outside the night had shif ted andthrown its cloak on the fading remaining
daylights, gold was now finishing a 50%
correction while crossing the 200MA andrespecting a long-term major trend line.
I remember a quote that crossed my way
once in a NYC public library: “In a world
governed by productivity, become dissatisfied with life, sell your possessions
and ride around the world on a bicycle ora donkey to acquire wisdom. This worldis impossible to understand, useless to
explain, live your life in exclamation notin explanation.”

I would like to thank Avramis Despotis for
introducing me to his river concept andtrading methodology. Special thanks to
Lynne Agoston, Linda Bernetich, Aurelia
Gerber Duverger, Constantinos Eracleous,Pythagoras, and Tradepedia Academy
www.facebook.com/Tradepedia.

StockCharts.com/ChartCon

About the Author
Born in Beirut, Lebanon, Mario G. Kfoury, CFTe, holds credentials in technical analysis,
physical education, martial arts instruction, and real estate; he is also a commercial multiengine IFR pilot. Self-taught in the streets of Beirut, Brussels, and New York, he synthesizes
his view and experience in life through different cultural and disciplinary prisms that lead,in his opinion, to a peaceful and humanitarian way of life.

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IFTAUPDATE 2014 Volume 21 Issue 2

page 18

Education Lounge

Head and Shoulders Above the Rest? The Performance ofInstitutional Portfolio Managers Who Use Technical Analysis
By David Smith, Christophe Faugère, and Ying Wang

ARTICLE SYNOPSIS byProfessor Christophe Faugère
For decades, students have been told byfinance professors that technical analysis(TA) is worth about as much as astrology or alchemy. Hence, the subject isbrushed aside in most business schools'
finance curriculum around the world. Yet,
TA remains a staple among many retailand institutional investors. These special skills are either learned on the job or
through special training programs. For
instance, the Certified Financial Technician(CFTe) or the Chartered Market Technician(CMT ) progr am of fered by re s pectively the International Federation ofTechnical Analysts (IFTA) and the Market
Technicians Association (MTA) provides
a formalized curriculum and whose successful completion requires two to three
exams plus significant work experience.
If, as mainstream academics believe, TA
is essentially worthless, why would investment outfits keep pouring resources inthis type of expertise over decades? Like
most people, if professional investors canbe fooled some of the time, they won't befooled all the time by a tool that does notwork, or works only by sheer luck.
The bigges t ad ver sar y of TA is thestrong held belief in the Efficient Market
Hypothesis (EMH). In 1965 Paul Samuelson
was the first to give a rigorous formulation of EMH: the market is efficient andprices are equal to fundamental values
when there is perfect competition, assuming all participants have free access to all
relevant information. In that case, all the
relevant information is incorporated into
prices, and because the flow of information is random, therefore prices follow
a martingale process. Consequently, no
one should be expected to profit fromstatistical or chart analysis of past prices.
That same year, Eugene Fama pointed out
somewhat sardonically that the theoryof random walks in stock market prices
constitutes an important challenge to the
proponents of both technical analysis andfundamental analysis.
In most cases, past academic studies havefound that indeed TA does not generate

above normal returns especially notenough to cover transaction costs. A
major drawback of these academic studies
is that they all rely on testing specific "runof-the-mill" technical indicators, without
necessarily replicating the combinatorialaspect and organic nature of the actual
strategies used by asset management
firms. More importantly, any portfolio
manager who finds a TA strategy that
produces above normal performance has
little incentive to discuss that method withresearchers. Thus, strategies that do work
are likely to remain concealed.
In this article, we rely solely on institutional
portfolio managers’ testimonials about theextent to which they use TA, irrespectiveof the form in which it is implemented.
We use the PSN Enterprise database,which contains survey responses collected by Informa Investment Solutions.
This gives us a sample of 10,452 actively
managed U.S. equity, international/global
equity, U.S. balanced, and international/
global balanced portfolios, collected asof July 2012.

In this large sample, we find that TA is
utilized by about one-third of U.S. andinternational/global equity and balanced
portfolio investors. Among equity fundmanagers, it is slightly more common
for micro-cap and all-cap managers.
Interestingly, five percent of portfolios forwhich managers said TA is “very important” are at least co-managed by someone who holds the CMT designation.
Let us now move to the important question addressed in the article. How effective is TA? To answer this question we
examine five financial performance metrics: (1) raw rate of return, (2) benchmarkadjusted return, (3) the information ratio,(4) Fama and French's 3-factor alpha,and (5) Carhart's 4-factor alpha. For raw
rates of return and benchmark adjusted
returns, we calculate equally weighted
portfolio returns for each ranking category for each month over the 231 months
between January 1993 and March 2012.
For inclusion in the sample, we requirethat a portfolio reports at least 30 monthsof returns.

IFTAUPDATE 2014 Volume 21 Issue 2

page 19

Education Lounge

Head and Shoulders Above the Rest? (continued)

With respect to mean and median values,
the performance advantage of TA is slight,
but statistically significant over the period
considered. The contrast appears moresalient when performance is measured
relative to a declared primary benchmark,in particular during down markets. Given
that TA purports to give traders an edgein market timing, it should be expectedthat performance metrics during down
months in particular will be superior for
portfolios using technical strategies. This
insight is confirmed here. On the basis ofbenchmark adjusted returns, managers
who consider TA to be "very important"outperform those who do not use it byan average of 19 basis points per month,in declining markets.

conclude that the net effect of TA on
the management of institutional equityrelated portfolios has been beneficial,although in an unexpected way.
Smith and Wang are with the Department of Financeand Center for Institutional Investment Management,
School of Business, University at Albany (SUNY),
Albany, NY 12222 USA. Faugère is affiliated with
KEDGE Business School, Bordeaux France.
Christophe Faugère (pronounce
Fo-Jair) received a master’s
degree in mathematical
economics from the Universityof Toulouse in 1987 and a
Ph.D. in economics from the
University of Rochester in
1993. He is currently professor of finance and chair

Regarding the Fama-French's and Carhart's
alphas, we also compute the means andmedians for each of the categories ofusage intensity of TA. A difference of 10
to 12 basis points per month is statisticallysignificant in favor of the portfolios whose
manager rate TA as "very important" vs.
those who do not use it at all.

of the Finance and Economics Department at Kedge
Business School in Bordeaux. Prior to this, he wasBusiness in New York.

Fig. 1. Cumulative Return Net of Benchmark for Institutional Portfolios Using Technical Analysis vs.
Funds That Do Not. Note: This graph shows the cumulative value of $1 invested on January 1, 1993, in
the average institutional portfolio managed using TA versus the average portfolio matched on asset class,market capitalization, and primary equity investment style.

Christophe has taught courses in investments,

asset pricing, market risk premia, financial crises,

published in top tier U.S. academic journals such as

corporate finance, derivatives, fixed income,monetary policy, ethics, and behavioral finance.

the Journal of Portfolio Management and Financial

an associate professor and chair of the Finance
Department at the University at Albany School ofMarkets, Institutions & Instruments. One of his

macroeconomics and monetary economics at the

The variability of returns is somewhat
more elevated in technically managed
portfolios. Nevertheless, the cross-sectionof portfolios managed using TA shows
remarkably high right-skewness and kurtosis values relative to portfolios that don't.
These patterns can be advantageous toinvestors. In view of these findings, we

graduate and undergraduate levels, as well as in

His current research focuses on ethics, financial

published articles on “Sell Discipline” received

executive programs in the United States. In 2006, hemarkets, and monetary economics. In particular,

extensive coverage in the New York Times andreceived the University of Albany School of Businesshis main research program is on models of asset

International Herald Tribune in 2004.

Harold L. Cannon memorial award for best teacher atvaluation (gold, treasuries, stock indexes) that are

the undergraduate level and was voted best professor

based on a combination of rational and irrational

Published in Research in Finance, Volume 29, 167–189

in the University at Albany School of Business MBA

investor behavior. He is the co-inventor of Required

Copyright © 2013 by Emerald Group Publishing Limited

program in 2002. His preferred areas of teaching

Yield Theory, one of the most accurate theories for

All rights of reproduction in any form reserved ISSN:

are stock market valuation, modern portfolio theory,

valuing the S&P 500 and gold. He has extensively

0196-3821/doi:10.1108/S0196-3821(2013)0000029010

IFTAUPDATE 2014 Volume 21 Issue 2

page 20IFTA Member Societies
AUSTRALIA—ATAA Australian Technical Analysts Association www.ataa.com.au
AUSTRIA—VTAO* Vereinigung Technischer Analysten Österreichs www.vtao.at
BOSNIA and HERZEGOVINA—SMS* Society for Market Studies trzisnestudije.org
CANADA—CSTA Canadian Society of Technical Analysts www.csta.org
CROATIA- CTAA* Croatian Technical Analysis Association www.huta-ctaa.hr
EGYPT—ESTA Egyptian Society of Technical Analysts www.estaegypt.org
FRANCE—AFATE Association Française des Analystes Techniques www.afate.com
GERMANY—VTAD Vereinigung der Technischer Analysten Deutschlands e.V. www.vtad.de
HONG KONG—FTAA* Financial Technical Analyst Association www.ftaa.org.hk
INDIA—ATA The Asociation of Technical Analysis www.taindia.org
INDONESIA—AATI Asosiasi Analis Teknikal Indonesia
ITALY—SIAT Società Italiana di Analisi Tecnica www.siat.org
JAPAN—NTAA Nippon Technical Analysts Association www.ntaa.org.jp
LEBANON—LSTA Lebanese Society of Technical Analysts www.lstalebanon.com
NIGERIA—TASN Technical Analysts Society, Nigeria www.tasnigeria.org
NETHERLANDS—DCTA Dutch Commission of Technical Analysis
NEW ZEALAND—STANZ Society of Technical Analysts of New Zealand www.stanz.co.nz
PAKISTAN—STAP* Society of Technical Analysts Pakistan www.stap.com.pk/index.html
ROMANIA—AATROM Asociatia Analistilor Tehnici din Romania www.aatrom.org
SAUDI ARABIA—SSTA* Saudi Society of Technical Analysts www.saudi-sta.org
SCANDINAVIA—STAF Skandinaviens Tekniska Analytikers Förening www.staf.nu
SINGAPORE—TASS Technical Analysts Society (Singapore) www.tass.org.sg
SPAIN—IEATEC* Instituto Español de Analistsas Técnicos y Cuantitativos www.ieatec.es
SOUTH AFRICA—TASSA Technical Analysts Society of Southern Africa www.tassa.org.za
SWITZERLAND—SAMT Swiss Association of Market Technicians www.samt-org.ch
TUNISIA—ATAT* Association Tusisienne des Analystes Technique
UNITED KINGDOM—STA Society of Technical Analysts Ltd. www.sta-uk.org
USA—TSAASF Technical Securities Analysts Association www.tsaasf.org
USA—AAPTA American Association of Professional Technical Analysts www.aapta.com* Developing

IFTA Update Schedule
IFTA Update is the quarterly electronic newsletter of the International Federation of TechnicalAnalysts, reaching more than 6,950+ IFTA colleagues worldwide. The Update is an efficientand cost-effective way to communicate with IFTA’s member societies and colleagues.

PUBLICATION SCHEDULE
September Issue

Education articles: August 15—send submissions to newsletter@ifta.org
All other content: September 1—send submissions to admin@ifta.org

December Issue

Education articles: November 15

All other content: December 1

March Issue

Education articles: February 15

All other content: March 1

June Issue

Education articles: May 15

All other content: June 1

For more information and to advertise, visit our website:
http://www.ifta.org/publications/newsletter/

Board of Directors
President Rolf Wetzer, Ph.D. (SAMT)Email: rolf.wetzer@ifta.org
Vice-President—the Americas William Chin, MBA (CSTA)
Email: wchin@e3m.com
Vice-President—Asia Pacific Akira Homma, CFA, CIIA, CFTe, FRM, CMA, CMT (NTAA)
Email: akira.homma@ifta.org
Vice-President—Europe, Conference Director Deborah Owen, FSTA, CFTe (STA)
Email: editor@irc100.com
Vice-President—Middle East, Africa Mohamed Ashraf Mohfauz, MFTA, CFTe, CETA (ESTA)
Email: mohamed.ashraf.esta@gmail.com
Treasurer Ralf Böckel, CFA (VTAD)
Email: ralf.boeckel@freenet.de
Education Director Gregor Bauer, Ph.D., CFTe
Email: gregor.bauer@vtad.deExam Management Director Jeanette Schwarz-Young, CFP®, CMT, M.S.
Email: optnqueen@aol.com
Accreditation Director Roberto Vargas, CFTe (TSAASF)
Email: roberto.vargasr@ifta.org
Marketing and Membership Director Dan Valcu, CFTe (AATROM)
Email: ta@educofin.com
Strategic Development Director Robert Grigg (ATAA)
Email: robert.grigg@ifta.org
Online Development Director Roman Bogomazov (TSAASF)
Email: roman.bogomazov@ifta.org
Journal and Newsletter Director Aurélia Gerber, MBA, CFA (SAMT)Email: aurelia.gerber@ifta.org
Website Content Director Akihiro Niimi, MFTA (NTAA)
Email: niimia@aifaminc.com
Sponsorship Director Mohamed El Saiid, CFTe, MFTA (ESTA)
Email: melsaiid@hc-si.com

STAFF
Executive Director Beth W. Palys, FASAE, CAE
Vice President, Meetings Grace L. Jan, CAE, CMP
Senior Member Services Manager Linda Bernetich
Marketing Manager Julie Hill
Senior Graphic Designer Jon BenjaminAccounting Dawn Rosenfeld
Editor Lynne Agoston

IFTA HEADQUARTERS
International Federation of Technical Analysts
9707 Key West Avenue, Suite 100
Rockville, MD 20850 USA

Phone: +1 240-404-6508
Fax: +1 301-990-9771
Email: admin@ifta.org

27th Annual Conference
9–11 October 2014
The Waldorf Hilton Hotel, London
Unravelling the DNA of the Market

Preliminary
Programme

The IFTA 27th Annual Conference

conference.ifta.org/2014

WELCOMEThe Society of Technical Analysts (STA) is delighted to be hosting the2014 International Federation of Technical Analysts’ Conference inLondon.
The conference will take place on 9–11th October at the Waldorf Hilton
Hotel in central London. The theme of the conference “Unravelling the
DNA of the market” will allow us to explore some of the underlying causesof market behaviour.
Keynote speakers include:■ Professor Marcus du Sautoy OBE – the Simonyi Professor for the
Public Understanding of Science and a Professor of Mathematics at
the University of Oxford. Presenter of The Code on BBC2.
■ John Murphy, Dr Alexander Elder and Tony Plummer – widely
acknowledged as today’s leading experts on technical analysis
and trading.
London is quite simply the most popular tourist destination in the world. It isa fascinating combination of the old and the new – 21st century technology
and architecture nestle among buildings that reflect the city’s 1000
year history. Delegates will have the opportunity to explore world-classmuseums and galleries as well as to see spectacular theatres and shows.

Deborah Owen
Conference Director
Society of Technical Analysts

The STA looks forward to welcoming you to a fascinating conference
which will include a buzzy social programme. Come and experience allthat London has to offer.

Committee Members
Deborah Owen – Chair
Investment of Research of Cambridge

Simon Warren
STA Treasurer

Katie Abberton
STA

Jeremy du Plessis
UpdataSusan Marmor
Private Trader

Charles Newsome
Investec

Axel RudolphCommerzbank

Jeff Hochman
Fidelity

The IFTA 27th Annual Conference

conference.ifta.org/2014

GENERAL INFORMATION
Date

Accommodation

Thursday 9th to Saturday 11th October 2014

Rooms have been held at a preferential rate at The Waldorf Hilton. The
hotel offers unbeatable bedroom rates to delegates attending this year’s
Conference from GBP 239 per room per night including VAT andbreakfast (single occupancy) from the 7th to the 12th October 2014.

Venue
IFTA 2014 will the held at The Waldorf
Hilton Hotel located on Aldwych,
London WC2B 4DD

Book your accommodation before 8th September 2014 and benefit fromour discounted rates.
You can book your accommodation via the hotel’s website by clicking hereor you can contact the Hilton reservation team by email hzl_mail@hilton.
com or phone 0870 5 909090 (when in the UK) or +44 (0) 207 836 2400
(for international calls).
Please note that only delegates registered to the Conference will be able totake advantage of our special rates.

The IFTA 27th Annual Conference

conference.ifta.org/2014

PROGRAMME OVERVIEW
Wednesday
8 October
8:30

Thursday9 OctoberFriday10 October

Saturday11 October

Registration & Exhibition Open
Arrival Refreshments

Registration & Exhibition Open
Arrival Refreshments
BreAkfAst symPosium, BloomBerg

Registration & Exhibition Open
Arrival Refreshments
BreAkfAst symPosium, BloomBerg

Opening Ceremony andTechnical Walkabout

New approaches in behavioural financeProf richard taffler, Universityof Warwick

Neuroscience of trading
tony Plummer, Helmsman Economics

Refreshment Break in the
Exhibition Hall

Applying behavioural financeto the markets
larry Berman, ETF Capital Management

Tuning your emotions for better
trading Part I
Dr Alexander elder

Refreshment Break in the Exhibition Hall

Refreshment Break in the Exhibition HallIntermarket analysis
John J murphy, StockCharts.com

Tuning your emotions for better trading Part II
Dr Alexander elder

Keynote Address
Dr marcus du sautoy oBe,
University of Oxford

Market Profile
robin mesch, Robin Mesch Associates

Power Hour

Lunch in the
Exhibition Hall

Lunch in the Exhibition Hall
luNCH symPosium, mA

Lunch in the Exhibition Hall
luNCH symPosium, mA

David sneddon,
Credit SuisseUse of point and figure to avoid black swans
Cyril Baudrillart, BSSP Partners

Conference Session

Refreshment Break in the
Exhibition HallPower Hour – Focus on Japanfeng Han, Fidelity Investments
Chris grafton, Hurst Cycles

Refreshment Break in the Exhibition Hall

Panel Session“Understanding risk”

Refreshment Break in the Exhibition Hall

Conference Session

Unravelling the DNA of the
Financial Markets
Deborah owen, Society ofTechnical Analysts
IFTA Executive
Board Meeting

16:30

AGM

17:00

Registration

19:00

Conference Session

Evening Reception at The
London Transport Museum

Conference Dinner at
Middle Temple

The IFTA 27th Annual Conference

conference.ifta.org/2014

SOCIAL PROGRAMMEThe IFTA Social Evening will be held on Thursday 9
October from 18.30 – 21.30 at the London Transport
Museum, located only minutes away from the Waldorf
Hilton Conference Hotel.
The museum has on display many examples of buses,
trams, trolleybuses and rail vehicles from 19th and 20th
centuries as well as artefacts and exhibits related to theoperation and marketing of passenger services and theimpact that the developing transport network has hadon London and its population.

The Conference Dinner will be held on Saturday 11
October from 18.30 – 23.00 in the magnificent surroundingsof Middle Temple Hall. Virtually unaltered since completionin the 1570s, it is one of the finest Elizabethan halls in the
country. The first performance of ‘Twelfth Night’ was acted in
the hall in 1602 with Shakespeare as a member of the cast.
The gala dinner in this stunning central London locationneeds to be booked in addition to the conference. It costs£125.00 per person for a three course meal, beverages
and evening entertainment.

The IFTA 27th Annual Conference

conference.ifta.org/2014

REGISTRATION
All delegates are required to register for the 27th IFTA Annual Conference via the online registration form found on the IFTA
2014 Conference website: http://conference.ifta.org/2014/
Registration Fees
Early
(Before 31 July 2014)

Standard(1 August – 5 October 2014)

Onsite(8 -11 October 2014)

IFTA & STA member£799.00£999.00£1,250.00

Professional Body Discount*£849.00£1,099.00£1,350.00

Non Member£999.00£1,249.00£1,399.00* Promotional code required

In case you are not an IFTA or STA member you can become one for 12 months for £85 which will entitle you to thediscounted rates above. You may join the STA here: http://www.sta-uk.org/NewApp.html
Full delegate registration includes:■ All appropriate Conference documentation and name badge■ Entry to all official Conference Sessions■ Access to Exhibition Area
■ Attendance at the Welcome Reception■ Attendance at the Thursday Evening Reception■ Tea and coffee breaks■ Lunches

Terms and Conditions
Cancellation
A refund of fees will be given less a 20% administration charge, provided that the Conference Secretariat receives notice ofcancellation in writing to IFTA2014@contendam.com on or before Wednesday 27 August 2014. After this date, no refund
will be given. Substitutions of attendees can be made at any time. Refunds will not be given for no-shows at the Conference.

The IFTA 27th Annual Conference

conference.ifta.org/2014

EXHIBITION AND SPONSORSHIP
Why IFTA 2014?

Involvement in IFTA 2014 will…

■ Contact new prospects and generate leads■ Promote your company/organisation as a leading
supporter of IFTA

■ Market your product to delegates and leading industry
professionals globally■ Provide you with a platform to develop high level, longterm contacts with key opinion leaders■ Showcase new innovations to the technicalanalysis community■ Strengthen your brand and existing relationships■ Promote company image and maximise
market exposure■ Differentiate you from your competitors■ Allow you to maximise the gains from our extensive
local and global marketing activities■ Discuss the needs of your clients first-hand anddemonstrate the solutions

To secure your commitment, please complete theSponsorship Application Form and Contract or the
Exhibition Application Form and Contract.

■ Gain insight into market trends to aid in yourstrategic planning

For further information please contact:
Katie Abberton
Tel: +44 (0) 20 7125 0038
Email: info@sta-uk.org

Exhibition Floorplan

Conference Sessions

3

4

5

6 7 8
9

1

10

Catering

Catering2

Society of Technical Analysts
Dean House
Vernham Dean
Hampshire SP11 0JZ
Tel: +44 (0) 20 7125 0038
Fax: +44 (0) 20 7900 2585
Email: info@sta-uk.org
A non-profit-making organisation dedicated tothe promotion of technical analysis. It serves
as a forum for traders and investors interested
in using technical analysis methodologies fortheir trading and investment. STA is an affiliatedsociety of IFTA, International Federation ofTechnical Analysts.
__________________________________________

Conference Secretariat
IFTA 2014
c/o Contendam
26-28 Hammersmith Grove, London W6 7HA
United Kingdom
Tel: +44(0)20 8748 8868 • Fax: +44(0)20 8237 4093
Email: IFTA2014@contendam.com
www.contendam.com

The International Federation ofTechnical Analysts Inc.
9707 Key West Avenue, Suite 100
Rockville, Maryland
20850
USA
Tel: +1-240-404-6508
Fax: +1-301-990-9771

Unravelling the DNA of the Market
The STA is affiliated to The International
Federation of Technical Analysts (IFTA),
which is the global organization of TechnicalAnalysis Societies and Associations. IFTA
is an international non-profit professionalorganization with member societies in morethan 26 countries. The STA’s qualifications arerecognised by IFTA. IFTA provides a worldwide
Professional Technical Analysts certification.

The IFTA 27th Annual Conference
9–11 October 2014 • London––––––––––––––––––––––––––––––––––––––––––––––––––––––

conference.ifta.org/2014