In the stock-market experiments, the placebo with which the technical strategies are compared is the buy-and-hold strategy. Technical schemes often do make profits, but so does a buy-and-hold strategy. Indeed, a simple buy-and-hold strategy using a portfolio consisting of all the stocks in a broad stock-market index has provided investors with an average annual rate of return of about 10 percent over the past one hundred years. Only if technical schemes produce better returns than the market can they be judged effective. To date, none has consistently passed the test.
