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Here's something that Jack told me he realized recently.
George develops systems but he failed as a trader.
Jack uses George's systems and he's successful. Jack realizes that
when the market is in an uptrend, 60 to 80% of all stocks are going
up. George, Bob, Fred and Bill's systems all work good when the market
is going up. It doesn't matter how complex the system is or how
simple it is, it's going to have a very high probability of working in
an uptrend.
Jack knows this and apparently George didn't. Jack realizes that
George, Bob, Fred and Bill's systems are going to have poor returns if
they're picking longs when the market is in a downtrend.
While Jack also understands that George's system can work even though
George failed as a trader, Jack understands that if he wants a mentor,
successful people make better mentors than unsuccessful people. While
he uses George's system, Jack has realistic expectations based on what
professional traders have told him and not on what George said. He
sees George as a tool provider and not as a money maker. He listens to
George's instructions on using the tool but not on making money. If
Jack wanted to sell systems, then George would be good mentor. If Jack
wants to make money from trading, George has limited ability to help
Jack.
So Jack picks a system that he can understand, and he only trades it
when there is an uptrend. Jack understands that he can tell when there
is an uptrend using simple moving averages and that any lag in the MAs
is irrelevant as long as he goes long with a portfolio of around 25
stocks sometime after the uptrend has started.
If Jack wants to go short, he tests George's system to see if it is
any good at trading shorts in downtrends. If it's not, he finds a
system that is good at shorting in downtrends, and he only uses in
when there is a downtrend.
Jack suspects that there is no such thing as a system that works in
both uptrends and downtrends so he stops looking for ONE and is
willing to use two systems when the conditions are right for each one.
Jack also understands that there is no "one" best tool. There are many
hammers for driving a nail. Some hammers feel better to some people,
but no matter how many hammers Jack tries, he knows the limits of
hammers and doesn't expect them to drive nails through steel or pick
good long trades in a downtrend. Jack knows that a hammer won't build
anything. It's his skill at using it that gets the house built.
--- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
<andysmith_999@xxxx> wrote:
> Thanks for the reply -- it made me realize something:
>
> George develops systems and presents seminars. George has failed as a
> trader. Therefore George's systems and seminars are bogus. --> FALSE.
>
> Condi uses George's systems and seminar learnings. Condi is a
> successful trader. Therefore George's systems/seminars are good. -->
TRUE.
>
>
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "jawjahtek" <jawjahtek@xxxx>
wrote:
> > Some answers to your questions since I have met some of these people:
> >
> > 1. Dr. Alexander Elder writes books, sells software, offers seminars
> > and personal coaching/consulting. Anyone know if he trades?
> >
> > Yes, Dr. Elder trades but it is a minimal level. He has tried and
> > failed several times to use his trading methods for an advisory
> > service. I'm not trying to disparage his work (or anyone elses), I am
> > just reporting what I know.
> >
> > 2. Chuck Lebeau develops systems. I love his writings. Anyone know
> > if he trades?
> >
> > Yes, LeBeau trades his various systems, but he is far more successful
> > at selling his systems. In his case, his clients are institutions
> > first. Systems that he sells to the average investor have already
> > been "fully utilized" by LeBeau's big dollar clients.
> >
> > 3. Van Tharpe was apparently unsuccessful in any trading and only
> > provides seminars now.
> >
> > 4. Ed Seykota, I haven't met him so I cannot make an honest comment.
> >
> > Bouns:
> > John Ehlers (MESA and its various incarantions). John is an engineer.
> > At a session where I met him, he showed his partially successful but
> > unimpressive trading record. John readily admits that he hates
> > trading.
> >
> > I think John Ehlers is a good example of the personality of a system
> > developer vs. the personality of a trader. Systems development
> > requires a willingness to program accurately. Accurate programs are a
> > pain to write, test and debug for the average person. A good system
> > developer's personality borders on obsessive perfectionism. Trading
> > on the other hand is a very messy business. A good trader readily
> > accepts that many trades will fail. Perfectionists do not make good
> > traders. It is rare for a good programmer to be a good trader. It
> > simply requires a different personality type.
> >
> >
> > jawjahtek
> >
> >
> >
> > --- In equismetastock@xxxxxxxxxxxxxxx, "metastkuser"
> > <andysmith_999@xxxx> wrote:
> > > Very interesting post.
> > >
> > > Dr. Alexander Elder writes books, sells software, offers seminars
> > and
> > > personal coaching/consulting. Anyone know if he trades?
> > >
> > > Chuck Lebeau develops systems. I love his writings. Anyone know if
> > he
> > > trades? Same questions with Van Tharp.
> > >
> > > What about Ed Seykota? No doubt about his trading abilities and
> > > wealth. So why does he offer a consultation service at Incline
> > Village?
> > >
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