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I plot the portfolio equity curve as if I was always in. But now
that you bring it up, it does raise the question of whether this is
equity curve trading or simply trading my own personal "index." Not
sure if this is just a semantic issue or a real one, since, as you
point out, if you're not in the market the curve is a straight line
and how do you trade that?:)
Sebastian
--- In amibroker@xxxxxxxxxxxxxxx, "droskill" <droskill@xxx> wrote:
>
> Ok - got you - yes, I'm looking at the same thing. So here's the
> question: if you're not in the market, isn't the curve just a
straight
> line? How are you altering your trading?
>
> --- In amibroker@xxxxxxxxxxxxxxx, "sebastiandanconia"
> <sebastiandanconia@> wrote:
> >
> > Total portfolio equity is what I'm talking about. Take a
portfolio
> > that you have, run a system-test, chart the equity curve, then
drag-
> > and-drop a moving average on top of it. That'll give you an
example
> > of what I'm looking at with equity curve.
> >
> >
> > S.
> >
> > --- In amibroker@xxxxxxxxxxxxxxx, "droskill" <droskill@> wrote:
> > >
> > > Sebastian - thanks for the response. However, I think I'm
talking
> > > about something different. I'm talking about using the overall
> > > performance/equity curve of a portfolio to modify the rules
> > associated
> > > with a trading system. But maybe I'm wrong - what did you mean
by:
> > >
> > > "I swing in and out of the portfolio (long only) using a moving
> > > average of the equity as a "buy" area when the general market
(SP500
> > > as proxy)"
> > >
> > > When you say equity in this case, do you mean portfolio
equity? Or
> > do
> > > you mean AN equity (as in a single stock)?
> > >
> > > --- In amibroker@xxxxxxxxxxxxxxx, "sebastiandanconia"
> > > <sebastiandanconia@> wrote:
> > > >
> > > > Coincidentally, I've just recently begun trading along these
> > lines,
> > > > with good success. With AB's ability to test and track
> > portfolios it's
> > > > relatively easy.
> > > >
> > > > My basic method: First, I use a stock screener to locate
CANSLIM-
> > style
> > > > small-caps. (MSN has an advanced one, free and powerful.
Major
> > > > brokerages have them, too, for customers.) Second, I
eliminate
> > foreign
> > > > issues from this list, keeping only domestic ones. I
> > also "eyeball"
> > > > all the charts, eliminating stocks with uptrends that are
> > > > clearly "broken" but somehow sneaked past the initial screen,
> > anyway.
> > > > Third, I *randomize* the list by putting it in alphabetical
order
> > by
> > > > ticker symbol. Finally, I choose the first 6 stocks on the
list,
> > and
> > > > that's the portfolio I work with. Each issue gets an equal
> > dollar-
> > > > amount of money invested.
> > > >
> > > > I swing in and out of the portfolio (long only) using a
moving
> > average
> > > > of the equity as a "buy" area when the general market (SP500
as
> > proxy)
> > > > is strong, and use a discretionary exit, i.e., I think the
trade
> > has
> > > > made me as much as it's likely to on this particular upswing.
> > > >
> > > > Since the beginning of the year I've hit three wins on three
> > round-
> > > > trips, up about 14%. (Not a brag, because humiliation is
only
> > one
> > > > trade away for us all, just pointing out the potential,
> > considering
> > > > that the SP500 and other major indices are still down for the
> > year.)
> > > >
> > > > I don't do any position-sizing, and just trade the portfolio
as
> > if it
> > > > was my own personal index. Only having 6 stocks might not
seem
> > like
> > > > enough diversification, but it works surprisingly well.
> > > >
> > > > FWIW.
> > > >
> > > >
> > > > Sebastian
> > > >
> > > >
> > > >
> > > >
> > > >
> > > > --- In amibroker@xxxxxxxxxxxxxxx, "droskill" <droskill@>
wrote:
> > > > >
> > > > > I was wondering if anyone has any experience with trading
the
> > equity
> > > > > curve itself as part of a system. In particular, I was
looking
> > for
> > > > > feedback on approaches to being above or below the curve -
did
> > you
> > > > > reduce/increase position sizes or the number of positions?
> > What have
> > > > > you found to be affective?
> > > > >
> > > > > Any feedback greatly appreciated - obviously I don't want
or
> > expect
> > > > > anyone to give away a great system, but I thought it might
be an
> > > > > interesting topic for a general discussion.
> > > > >
> > > >
> > >
> >
>
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