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This was published as fiction in a pocket book
about 30 years ago. I don't remember the title, but it probably was
something about gambling, like gambling, roulette, or break the bank. Since
the system was the reverse of conventional wisdom, the Martindale. it just might
work.
Lionel Issen<A
href="mailto:lissen@xxxxxxxxxxxxxx">lissen@xxxxxxxxxxxxxx
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----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Macromnt@xxxxxxx
To: <A title=metastock@xxxxxxxxxxxxx
href="mailto:metastock@xxxxxxxxxxxxx">metastock@xxxxxxxxxxxxx
Sent: Sunday, July 15, 2001 7:53 PM
Subject: Re: Naz 100 futures buy and hold
system
In a message dated
7/13/01 4:24:24 PM Eastern Daylight Time, <A
href="mailto:gcwallace@xxxxxxxx">gcwallace@xxxxxxxx writes:
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TYPE="CITE">No money management system can turn a net losing game or
system into a winner. Hi! I am sorry to
disagree. As a matter of fact to take the same example of roulette it has
been done. About 25 years ago a group of Englishmen went around the
casinos of Europe and won playing with a money management system that was
exacly the opposite of the classical martingal: each time they were losing
they were reducing there bets but were letting their profits run up to the
casino limit when they had a winning strike. I don't remember the details
but very quickly they were not allowed to step in any casino. They were
putting the casinos in the position of the beginner gambler who plays a
martingale. But we agree on this : this is your anti-martingale. For me an
anti martingale is money management. There are some other
martingales that are a little bit more subtil that sinply doubling every
losing bet. For instance you write a column with the following numbers:
1 2 2 1 2 2 You first bet will be 3 (the sum of
the first and the last number). If you win you cross the first and the
last number and your next bet is 4 (the sum of the first and the last
remaining number). If you lose you writ the amount of your first bet at
the bottom of the column and you gamble the sum of the first and the last
(4). And so on till you have crossed all the numbers. then you start a new
columd. It works most of the time... till it does not work. Anyway all
those martingale end up with ruin and even if they did not the potential
profit is far to small in comparaison with the capital engaged. If teh
capitalization needed to trade this system (and to lose) on the Nasdaq
would have been over $1M starting when the Nasdaq was between 4000 and
5000, what would have happened if the Nasdaq had gone up to 6000. The
(lucky) investor would have had one position winning and the gain would
have been very small compared with the reserve needed tro trade this
martingale to the current Nasdaq level (assuming that it does not go
lower). About money management turning a losing game into a winner it
seems to me that trading the markets does not have a psoitive expectation
if you take into account slippage and commissions. If we make money on the
markets if thanks to good money management. You can object that the stock
market has a positive expectation because it ALWAYS goes up over a long
period of time. However the studies shows that this long period of time is
75 years and I am not ready to wait so long to make sure that history
repeats itself.
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