CARAT CAPITAL LLC

New Research

Past performance is not necessarily indicative of future results.      An investment in futures can result in losses.

David Baorto, MD, PhD, is a specialist in neural network and non-linear mathematical research.  Dave's focus has been "knowledge engineering" and applying neural networks to medical data.  Carlton Chin, CFA, CARAT's founder, has worked with Dave since 2000 to apply Dave's expertise to the financial markets.  Together, they have performed many hours of research and simulations -- and feel that they have improved upon traditional technical systems.  

Their research has focused on the dynamics and “micro-aspects” of the financial markets.  They have found that the markets HAVE, to some degree, changed over the past several years. 

While the best way to earn profits in the markets CONTINUES to be sustained movements (trends) in the markets, traditional technical systems have trouble with noise and random motion.  As we know from the past, whipsawing (or market trend reversals) cause trouble for most trend-followers.  The neural network approaches we have developed seem to do a better job with this "noise."  While no system will be right all of the time -- we think that these non-linear approaches will let the "noise" work for us (or at least not hurt us as much) -- AND still capture large, sustained moves in the markets. 

Why have the markets changed?  One reason might be that information travels so fast these days.  Another reason might be that so many people have computers today.  Perhaps too many people followed these trends -- making the trends short-lived, and harder to earn profits... 

Nevertheless, we want to stress that our overall philosophy remains the same: we remain diversified; and we still seek fundamental reasons for returns.