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It's always too early to give up ...

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How did the stock market barometer come about?

It all started in 1998. As with every big bull market in the stock markets, new stock market prospects come along, so I discovered the world of stock markets in 1998.

Of course, like every beginner, I also bought at the high point, motivated by a newspaper article.


They were Daimler-Benz shares. To date, Daimler has not reached the course of 1998! The author of the article was probably not entirely correct in his analysis. With the crash in October 1998, the portfolio was halved and I  lost interest in the stock market. The "insider tips from the newspaper" system has failed.


With the speculative bubble of the New Economy, new motivation (greed) emerged. I was able to participate brilliantly, but unfortunately only until the point at which this bubble burst too. The second loss. This time even a total loss because the depot contained many bankruptcy candidates!


Rather frustrated, I wanted to turn my back on the stock market forever. and focus on "reasonable" work. On the other hand, high-flyer stocks were presented in newspapers that doubled in a very short time. It was a battle between fear and greed. The temptation to make quick money contrasted with the third total loss.


If you want to venture back into the stock market carousel, then only with a weatherproof strategy.

By chance I saw a magazine that dealt with systematic stock trading. Trading systems and mathematical indicators (e.g. moving averages, RSI, etc.) were described there.


Fantastic returns were promised. That was the new beginning. Motivated by a new approach and with huge Excel tables, I tried to master the situation and to find the holy grail of investment. But even this approach was not crowned with success in the end. Even if no money was lost, the dream returns depicted in the magazines did not materialize.


In 2003, with ever faster internet speeds and new, more professional software that could read and process historical data, light came on the horizon. Back tests could be carried out.


With endless hours of processing stock market data, reproducible results were achieved. There was only one catch.

All trading systems that I programmed ran great, but regularly warned too late about the big stock market crashes.

So I was able to see the drawdowns through the backtest that would await me if I happily started trading.

The huge drawdowns were foreseeable but it was also evident that the sun was shining again after every thunderstorm. In any case, I became more careful and reduced the risk.


I had recognized the truism that every stock is only as good as the overall market allows it to be. If the entire stock market falls, very few stocks will resist.


What was missing was a timing indicator that defined the fundamental and technical state of the stock exchanges. An indicator that shows whether money is flowing in or out of the stock market. An indicator that turns red when a hurricane is brewing. Then you would actually have found the holy grail.

And that succeeded a few years later! Apart from our trading software, I had collected bits of the mosaic from books, seminars and conversations and assembled them into a complete work.


I survived the crash of 2008 without any losses. After the losses previously suffered in the great stock market crashes, that was a huge step forward. In good years on the stock market, you are usually successful anyway.


With more new software and countless hours in front of the computer, the techniques became more and more sophisticated. The result is a holistic approach that allows you to invest in the stock market in a relaxed manner without fear of the next crash. The stock market barometer has been a steady development over the years and is probably still not finished.



The real reason that 95% of all players in the financial market lose is no or only a half-finished trading system. When the next crash or drawdown is in the front door, you throw all the rules overboard because you don't trust your system or know that it is not fully developed.


Most people, however, do not have the time or resources to deal so deeply with the matter and develop a system. That's why people start to act, always afraid that the next crash is just around the corner. With this constant fear and insecurity on the back of your neck, it is the same as with all other endeavors. You start making mistakes and in the end you lose the game.


The search for a system was very time-consuming and a psychological challenge. There have been thousands of setbacks.


Unfortunately, I wasted too much time. Too much poking around in the fog meant that you didn't earn or lose any money for years.


Unfortunately, all the half-knowledge that is circulating around does not create enough clarity and unambiguous rules. But it is imperative to understand the stock market! Otherwise everyone would be rich if it was that easy? But I can reveal the secret, it's easy when you understand it and have realistic expectations.


If you understand how the stock market works, then it is like a self-service shop.


Successful in the stock market means (applies to short-term or long-term investments):


1. A system to find the right stocks

2. A system to recognize an advantageous phase

3. Trade management / risk management


Everyone decides for themselves how long to fish in murky waters!



I wish you an easy way into the stock market, take the shortcut.


Dipl.-Ing. Matthias Wiemert Cyprus

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