The book draws from three disparate fields to present a theory of how markets work: Market Profile, behavioral finance, and neuroeconomics. The Market Profile posits that that the markets reflect a continuing auction in which the underlying dynamic of the market is to facilitate transactions. Behavioral finance posits that investors do not make rational decisions, but rather are driven by emotional factors or rely on rules of thumb in making decisions. Neuroeconomics emphasizes that underlying psychology of investors permeates their investment decisions. Mr. Dalton believes the markets natural auction process in conjunction with the frequently irrational decisions of investors create predictable market structures and predictable opportunities for investors how understand the underlying dynamics. The book will improve investors ability to interpret change and continuity in markets and to make better, more confident investment decisions.
Book Details:
- Author: James F. Dalton
- ISBN: 9780470039090
- Year Published: 2007
- Pages: 224
- BISAC: BUS027000, BUSINESS & ECONOMICS/Finance
About the Book and Topic:
The book draws from three disparate fields to present a theory of how markets work: Market Profile, behavioral finance, and neuroeconomics. The Market Profile posits that that the markets reflect a continuing auction in which the underlying dynamic of the market is to facilitate transactions. Behavioral finance posits that investors do not make rational decisions, but rather are driven by emotional factors or rely on rules of thumb in making decisions. Neuroeconomics emphasizes that underlying psychology of investors permeates their investment decisions. Mr. Dalton believes the markets natural auction process in conjunction with the frequently irrational decisions of investors create predictable market structures and predictable opportunities for investors how understand the underlying dynamics. The book will improve investors ability to interpret change and continuity in markets and to make better, more confident investment decisions.
The quest to understand the underlying dynamics of markets has long fascinated investors. The efficient market and random walk theories state that a markets past behavior has no bearing on future behavior and no one can consistently beat the market. Many investors are dissatisfied with these explanations and believe markets are, to some degree, predictable. Various alternative theories have been advanced, but no one has been able to develop a theory of market behavior that can consistently forecast the markets future direction. Market profile and behavioral finance provide alternative explanations regarding how markets work, but neither can forecast markets or consistently identify profitable investments.
New approach to identifying profitable investments. Explains how human behavior creates market inefficiencies, the place of greatest market opportunities. Integrates hot new approaches to explaining markets. Draws on market profile, behavioral finance, and neuroeconomics to create a new approach to looking at markets. Author is well-known expert in the trading world. The author was a pioneer in the popularization of the market profile, a relatively new and widely used trading approach. Intellectually challenging, well-written book: As preliminary pages and outline indicates, the author draws on a number of different sources to create a book that is erudite, interesting, and full of insights about investors, traders, and the financial markets.
About the Author
James Dalton (Prescott, AZ) has been a pioneer in the popularization of the Market Profile, a unique method of interpreting market behavior and identifying trading/investment opportunities. Most recently, Mr. Dalton was director of research for managed accounts at UBS Financial Services and, prior to that, manager of hedge fund research for UBS. Previously, he was an executive vice president at the Chicago Board Options Exchange. He began his career in the investment industry as a broker with Merrill Lynch and Shearson Lehman. He wrote a book, Mind Over Markets, which was one of the best books ever written on the Market Profile.