Alan Steel
01506 842365
MENU
  • Home
  • About Us
    • Close
    • About Us
    • What We Do
      • Close
      • What We Do
      • Our Services
      • Our Philosophy
      • Our Awards
      • Our Reputation
    • Who We Are
      • Close
      • Who We Are
      • Meet the team
    • Our Approach
    • Financial Planning
  • Testimonials
  • Investments
    • Close
    • Investments
    • Investment Advice
    • Portfolio Building
  • Pensions
    • Close
    • Pensions
    • Retirement Planning
    • Early Retirement
    • Pensions as simple as...
  • Tax
    • Close
    • Tax
    • Tax Advice
    • Tax Planning
    • When I'm Dead and Gone
    • Inheritance Tax
    • HMRC Digital Accounts
  • Insights & Media
    • Close
    • Insights & Media
    • Letters from Linlithgow
    • Informing You
    • Letter from America
    • See us in the Press
    • Master Investor
    • Points of Few
  • Contact Us
Independent financial advisers founded in 1975
Over £1.4 billion client funds under management
17 industry awards for advice since 1989

By Alan Steel, Chairman

This article contains the personal views of Alan Steel and should not be construed as advice. Do check your individual circumstances with your advisers.

Getting a measure of the mumbo jumbo indicator

As I See It: Alan Steel
By Alan Steel | Sunday, 02 June, 2019

While chilling in the campo in the sleepy San Juan area of the much maligned “party island” of Ibiza I was glad of the absence of scrotal media for a change. No Brexit, no Boris, no chaos, no satellite TV, no English newspapers, just muy tranquillo and the odd gambas ajillo washed down by bottles of verdejo or albarino. Algo mas? Magic.

And I managed to catch up with my Hong Kong correspondent Mr Hu, and over the odd muse or two we discussed the never ending stuff that typically intrudes our mailboxes day after day. Stuff that purports to be financial analysis but is most probably pumped out by what nerds call AI…the acronym for Artificial Intelligence. (I always think of Intelli tubbies for some unknown reason).

Anyway , Mr Hu reckons that once you analysed (there’s anal again!) these Google “ financial articles” you come to realise that AI and not HB (human being) has delivered them to our overloaded mailboxes. So, dear readers, if like me you thought that QE was a big ship and that Tobins Q was a song by Creedence Clearwater Revival, here’s what Mr Hu said to enlighten me on the minutiae of investment mumbo jumbo indicators and ratios dumped in our overstressed digital direction.

If it’s all Greek to you don’t worry. Neither Mr Hu or I took to Nana Mouskouri or the singing tent. He said he liked Sharpe Ratios and that you couldn’t beat a good Fibonacci, preferably with a side salad. Mr Hu’s education was like his stomach and mine- well rounded. A bit of Latin here, a pinch of maths, garnish of physics, a liberal dose of German, et voila, everything a budding investor needs.

But he reckons he’d missed out on a few economic ingredientsia from the artificial intelligentsia, but shared with me a list of metrics and ratios he’d found in the AI-generated analyses sent to his inbox, and added the true definition for good measure:

Schaff Trend Cycle—When you can’t tell the wheat from the schaff

Aroon Down Level—First devised by Jules McVerne and published in Aroon the World in 80 days

Piotroski F-Score   What an English supporter shouts when the fitba team loses to Poland (again)

ERP5 rank     Where to locate a taxi in Edinburgh

Montier C-Score- The original scooter music written for the Monteverdi Vespers.

The Balance of Power signal—When the referee decides the scrum’s going nowhere and orders a reset.

The Awesome Oscillator signal – Only used in Bull Markets, as in “How did the markets do today”

The SuperTrend Indicator- a line drawn on a graph by analysts to support a BUY recommendation. This line never slopes down.

An Ichmoku Kinko Hyo Chart-  Japanese equivalent of the Kama Sutra.

Now if you think these names are made up, Mr Hu has to disappoint you. They are all genuine terms of mumbo jumbo , and it struck him that there’s precious little mention of cash flow or profitability. Funnily simple indicators like that have gone out of fashion. As has common sense.

Finally Mr Hu’s personal favourite analytical tool is the ISIHAC ratio. Which stands for “I’m Sorry I haven’t A Clue”

I reckon he’s on a winner there.

©2023 Alan Steel Asset Management Limited is authorised & regulated by The Financial Conduct Authority. Please note that the Financial Conduct Authority does not regulate some forms of tax advice. Company Registration: SC58014

You should remember that the value of an investment and the income from it could go down as well as up. The return at the end of the investment period is not guaranteed and you may get back less than you originally invested.

The investment services and/or investments referred to in this website may not be suitable for you. If you are unsure we suggest you contact us to discuss matters further. If we believe our services are not right for you we will tell you.

When investing money, whether for income or growth, you are placing your capital at risk as the value of investments may vary, so you could get back less than you started with.

The Financial Conduct Authority does not regulate Tax Advice, Trusts or wills. Alan Steel Asset Management Limited is authorised and regulated by the Financial Conduct Authority. The guidance contained in this website is subject to the regulatory regime of the UK.

The Financial Ombudsman Service (FOS) is an agency for arbitrating on unresolved complaints between regulated firms and their clients.

FOS details can be found at www.financial-ombudsman.org.uk

Alan Steel Asset Management Limited are not responsible for the content of external sites.

  • Cookie Policy
  • Privacy Policy
  • Website terms and conditions
  • Tax Services Privacy Notice
  • Contact Us

This site uses cookies. By using this site you agree to the use of cookies. Read our Cookie Policy