Sergio Paolino

SIAT Member

    Sergio Paolino was born in Milan on July 31st 1947. Obtained the scientific maturity, he enrolled at the Faculty of Engineering at the Politecnico di Milano.
    After taking a doctorate in Mechanical Engineering, with specialisation in the design of industrial plants, he began to deal with industrial machinery and production processes. Then, in his fourth working life, which began in 1984, he dealt with full time technical analysis and he has always privileged the construction of trading system to any other approach.
    Since 1989 he is an ordinary member of AIAF (Italian Association of Financial Analysts).
    He was president of SIAT (Italian Society of Technical Analysys) for nine consecutive years. After his resignation he moved from Milan to Asti.
    He held countless technical analysis seminars, most of them dedicated to trading systems.
    On the weekly “Borsa & Finanza” he published about 1000 issues of technical analysis and the explanation of how they are made and how they have to be used with more than 500 indicators. He also published more than 30 different indicators of its design.
    To evaluate the goodness of his indicators he used tests based on the Monte Carlo method  and he created a revised one called “Limited Chaos”.
    “The real richness is the time and we are obliged to spend it all: more free time we are richer”-  that’s his motto.




    Trading System Signal Filtering

    In 1887, a prize was set up to solve the problem of the 3 bodies; the winner was the mathematician Henrì Poicaré.
    His theories were resumed by others around 1950 and finally, in 1963 René Thom formulated the Theory of Catastrophes, which he found his first application in the topology; later Erik Christopher Zeeman gave the cusp catastrophe an interpretation that could be used to explain the stock markets trend.
    Excellent for a qualitative trend explanation, but insufficient to have quantitative information applicable in real time.
    The theory of bifurcations is linked to the previous one, but it can also provide a quantitative information; It is easier to use as it can operate in the plane with equations of the 2nd order and not of the 4th order as for the theory of the cusp catastrophes.
    Bifurcation Theory can provide a risk measurement in the stock markets and we use it to try to eliminate the false signals of a trading system.