The random-walk theory discourages all hope of capitalizing on price fluctuations. None of these three viewpoints really comes to grips with the problem of making money consistently in the stock and commodity markets. Technicians, finding particular, frequently recurring, price patterns in the past to be the harbingers of prices to come.Academicians, unable to improve significantly on the Bachelier premise that price movements are random within reflecting bounds.Fundamentalists, holding that price movements principally reflect changes in the circumstances related to a company and its products or activities.In the following years, market enthusiasts split into three distinct groups:

Thus, within this brief span of time, documented price data became available, the random-walk theory was proposed, and one of the first technical approaches to stock market trading and investment was born. Nelson compiled Charles Dow's ideas in THE ABC OF STOCK SPECULATION. Louis Bachelier wrote his provocative and scholarly paper 'Theory of Speculation' that became the basis for the random-walk theory of price variation. This provided graphic visibility to the form of price change versus time.ġ900. The Dow Jones Averages were created and published. THE WALL STREET JOURNAL came into existence, and with it, a wealth of accurate and readily available information on price movements as a function of time.ġ896. At about that time several important events took place:ġ889. Despite this long history, it wasn't until after the turn of the last century that serious thought was given to why equity prices vary, and in what manner. The corporation concept has been in existence since the 1300's-and negotiable equities on the North American Continent date from the issuance of Hudson Bay Company stock in about 1670.

Cyclical coherence meaning