A RANDOM WALK DOWN WALL STREET

If your favorite market system just took another beating, Markiel doesn't wonder why. We've had bubbles and crazes and booms, but Wall Street, Virginia, just isn't predictable -- or, all too predictably, ""prices move so quickly when new information does arise that no one can consistently buy or sell enough to benefit."" If all the chartists and superanalysts were to all share their graphs, formulae, indices and other complicated calculations and choose their portfolios by blindly sticking a pin into the listings like kids playing Pin-the-Tail-on-the-Jackass, they'd do as well or better than they do now (we've heard that before). Markiel's is called the ""random walk theory"" -- it doesn't matter what securities you select if you adopt the ""buy and hold strategy,"" diversify your portfolio, keep a cash reserve to invest on downswings, and stash your bread and butter money in a saving bank. The author's a skeptic, conservatively inclined -- at his most adventurous he'll choose bargain-priced issues which have had above average growth rates and price-earnings ratios for the past five years. He won't get you two million (just a 9% annual return) but that's no bull when the market's bearish.