Joseph Granville (1923-2013) was well-known as a financial writer and investment seminar speaker.
He is mostly known for inventing a concept known as "on balance volume (OBV)"
His theory being that when volume increases rapidly with no large change in price, then that price will eventually catch up and increase. The same would work for a decreasing price.
Joseph Granville published a financial newsletter called The Granville Market Letter from 1963 until shortly before his death in 2013.
He was probably best known for his bearish market views. He predicted big falls in the 1970s, 1980s, and 1990s. In the 1980s he was said to have been responsible for a $25 Billion fall in the markets.
However, his track record was not great, but neither was that of Jesse Livermore (who made a fortune four times and lost a fortune four times).
Joseph Granville says:
"As soon as you've got the key to the stock market, they change the lock"
Although the trading record of Joseph Granville was not that good, he was a good writer.
Like all traders he had rules. Here are his four main Lessons as he called them:
Lesson #1: Discipline
It's ironical. Joseph Granville championed the importance of discipline, yet didn't quite adhere to his own sermons.
For example: he created several market indicators that are still in use today, especially "on balance volume". But he sometimes failed to listen to his own advice.
Oftentimes, his indicators just did not work for him.
In fact, it wasn't the indicators that were at fault, it was his interpretation of them that was faulty.
Lesson #2: Don't Take Yourself Too Seriously
Joe Granville was a showman. He loved to play to the gallery. During his seminars he used to do all kinds of stunts. Once he installed a plank across a swimming pool hidden just below the surface and tired to convince his audience he could walk on water.
And he tried other stunts at his various events.
Lesson #3: Humility is a Virtue
Granville successfully predicted the market top in January 1981 and his picture was dsiplayed on the front page of the New York Times.
He started to become over confident.
For a few months, he was right in his predictions.
But come the Bull Market of 1982 he was not.
Lesson #4: It Doesn't Matter What People Say
Wall Street used to ridicle his clown-acting but he was the one laughing all the way to the bank.
He once sat in on a TV show "The Wall Street Week" to talk about investment newsletter performance. Joe and another editor of a financial newsletter were on the show together. The other guy being fairly successful in the newsletter buisness and Joe maybe not so, but Joe had the confidence and the other guy was stuttering.
Who do you think got the better reception?
Joseph Granville was a prolific writer and his book majoring on the topic of "on balance volume" is classic.
New Key To Stock Market Profits by Joseph Granville
Joseph Granville wrote 7 books in all, but his 'New Key To Stock Market Profits' was probably his best.
It focuses on stock volume but measured in a certian way. Granville named this "on balance volume" and his book, well over 300 pages of jam-packed text and oodles of charts (over 70) and dozens of tables.
Joseph Granville's writing style is refreshing. Although written in 1963 his message comes across loud and clear.
We found this book absorbing and extremely informative. It takes a prominent place on our Stock Trading bookshelf.
You can gain access to this magnificent book by clicking the link below:
Joseph Granville certainly brought something to the table of stock investing.
He was a confident guy who believed in what he did. He wasn't always right in his predictions but probably right more often than wrong.
His legacy of technical indicators, particularly "on balance volume" we should all be grateful for.
We certainly enjoyed his book - it was obvious it was written by a man who was super confident in what he did.
Chris and Clem Meet Up - hopefully, the last time before lockdown easing
Chris and Clem Meet Up - at last! They can meet in the beer garden
Chris and Clem Meet Up and it is Chris' turn to do most of the talking. Chris' little windfall has allowed him to widen his portfolio. Chris vows of more.