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Thanks, Mark!
Money management is the reason I'm still in the game. I have my spread sheet set up to always risk 1%, whether buying stocks or options. No more, no less. It calculates position size based on a 10% stop for low priced stocks and 6% for stocks over $15.. I will then look at the chart and adjust the stop loss, along with position size to meet the MM criteria, based upon technical considerations that I see. That seems to work for me, but it appears to me the opposite of your approach. Interesting!.
My Market sentiment tool is a simple trend line on the Russell 2000. I use both daily and weekly charts and decide which to override based on market feel. (I don't like that part, but it appears to work most of the time) Down trend lines are drawn to the last high that is still lower than the previous significant high. The direction change occurs when the last significant high is lower than the current price. Up trend lines are drawn and interpreted in the opposite mode.
I am interested in learning more about your dip system and your time based entry and exit strategy. I gather from your comment that you do not pay much attention to the instrument trend?? Does that mean you will go long, without regard to the underlying instrument trend, or do I misunderstand? What then, do you use to define the dip? How long are you in the trade? How do you determine the end of the retracement (dip), and how do you determine the end of the "spurt"?
I am truly enjoying this thread! I do hope the rest of the folks are as well!
Millowena
----- Original Message -----
From: Mark H
To: amibroker@xxxxxxxxxxxxxxx
Sent: Tuesday, June 20, 2006 8:33 PM
Subject: Re: [amibroker] (OT) Re: Has anybody made any money???
Millowena:
I may not be the guru you are looking up to. I still become edgy with my DD. But I can probably give you some hints which may be helpful in improving a dip buy system.
For dip buy, the expectancy is very low, maybe just 1.1-1.3, at least for my system. To achieve high returns, you need to trade a lot. Position sizing is the key. Trade small positions 5%-10% of equity, use just time stops, do not use price stops, the small position sizes already control the risk. If your expectancy is different, you may need different position sizing algorithm. (BTW, if you buy dip and hold for big gain, it is not dip buy, it is trend-following. Dip buy means buying when a stop dips and selling when it bounces back for small profits).
Another consideration is market conditions as I already mentioned in another post. Use market-based indicators to identify bull/bear conditions. Only trade or use margin when market is bullish. Get out when market is bearish. The system is in the market for only 50-70% of time. This rule can greatly reduce DD and does not impact returns as much.
And do a lot of backtesting and some optimizing, I found Robert Pardo's book helps a lot in becoming confident with your backtest results.
Best Trading,
- Mark
----- Original Message -----
From: MillowenaJuno
To: amibroker@xxxxxxxxxxxxxxx
Sent: Tuesday, June 20, 2006 7:07 PM
Subject: Re: [amibroker] (OT) Re: Has anybody made any money???
Mark,
It appears you are doing something RIGHT, that the rest of us would like to
duplicate, or at least emulate.
I too buy dips and look for STRONG stocks that have shown me that the market
likes them too. Unfortunately, my results are nowhere NEAR yours..
Would you please share with us your system in sufficient detail to allow us
to learn how to have similar results?
Thanks!
Millowena
----- Original Message -----
From: "sebastiandanconia" <sebastiandanconia@xxxxxxxxx>
To: <amibroker@xxxxxxxxxxxxxxx>
Sent: Tuesday, June 20, 2006 12:39 PM
Subject: [amibroker] (OT) Re: Has anybody made any money???
> Mark, my trading now is along similar lines: Focus on strong stocks
> (my preference is small- and micro-cap growth) but ONLY when the whole
> market is strong.
>
> The main difference between our methods seems to be that you're
> deliberately buying on dips and I would only do that
> unintentionally.:) The practical outcome is that your returns are 2-3
> times what I can reasonably expect, but with higher drawdowns. One of
> the "market wizards" (I don't remember which one) once said that if
> you expect to double your money you have to be willing to lose 1/3 of
> it. Sounds like you're right in there.:)
>
> Thanks for the idea about the 5-8 day time-stops. It might only be
> applicable for buying on dips instead of buying into strength, but
> I'll look into it anyway.
>
>
> Luck,
>
> Sebastian
>
>
> --- In amibroker@xxxxxxxxxxxxxxx, "Mark H" <amibroker@xxx> wrote:
>>
>> Dr Gaine$
>>
>> My strategy is dip buying. When the market is bullish, buy strong
> stocks when they dip steeply and sell them when they rise.
>> The secret is to use time stops (5-8 days) to let your capital work
> harder for you.
>> The most difficult part is to sit tight when market is not good and
> also stomach the drawdown up to 40%.
>> Backtest helps a lot to pull the trigger when you are down 40%.
>>
>> - Mark
>>
>> ----- Original Message -----
>> From: richard gaines
>> To: amibroker@xxxxxxxxxxxxxxx
>> Sent: Sunday, June 18, 2006 9:40 AM
>> Subject: Re: [amibroker] Has anybody made any money???
>>
>>
>>
>> Share your strategy with us Mark.
>>
>> Dr Gaine$
>>
>> Mark H <amibroker@xxx> wrote:
>> Absolutely. Average 126% for the last three years.
>> But you should know that software are just tools and not money
> printing machines. It is what between your ears matters.
>>
>> ----- Original Message -----
>> From: tom_katch
>> To: amibroker@xxxxxxxxxxxxxxx
>> Sent: Saturday, June 17, 2006 7:04 AM
>> Subject: [amibroker] Has anybody made any money???
>>
>>
>> I own Amibroker software, and have the latest version
> (standard). I
>> also have Metastock, Vectorvest and some other software. But I am
>> sorry to say that Amibroker is the only software I ever bought
> that I
>> did not study up on. I understand that most of the users are very
>> pleased with it from looking at this forum. Most of the
> postings are
>> of a technical nature, with questions as how to understand and
> use the
>> software. But I don't recall seeing postings from people
> noting their
>> success in using the software. Have any of you had
> great/good/fair
>> success in using it? Have you made a lot/some/little money
> with it?
>> Maybe some of your positive comments will give me a kick in
> the ass,
>> and I'll start on the 800 page manual.
>>
>> Thanks
>>
>> Fred
>>
>>
>>
>>
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