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I don't do much day trading. I find it to be a tedious, stressful and
not a fun way to make a living. I don't like being glued to the
computer all day either. I have a lot of other things to do. It's just
not my cup of tea.
However, off and on I occasionally day trade, but I try to avoid it. I
find day trading to be more useful in this kind of market where
volatility is high and the market is having trouble establishing a
long term direction.
How long I stay in a position depends on the market conditions, the
volatility of a specific stock and what the fundamentals of the that
stock looks like. I change my stops and exits according to those
issues. I only use TA as a guideline and my brain as my decision tool.
I've been trading off and on for nearly 30 years since grad school in
the seventies.
Most of the economics and finance professors thought that the
mainframe computer was going to revolutionize trading, and they were
going to get rich. I started programming on an IBM 1620 which was
about 1000 times slower than my current HP calculator. I then moved to
the IBM 370. Well, the computer didn't make any of them rich because
just like today, we only had price and volume data to work with. I
think it's harder to make money today trading because everyone is
working off the same information at the same speed. When a lot of
people were relying on the price and volume data from the Wall Street
Journal, it was possible to get an edge on them.
The computer has made the cost of data cheaper. I was paying $10K a
year for what I get from Reuters and Esignal for a few hundred dollars
now, and it's current to within seconds of the market.
I think TA and computers have made portfolio management easier and
more profitable. I see what I do more as portfolio management than
pure trading.
Good luck and don't forget to have fun. After all it's your money!
Super
-- In equismetastock@xxxxxxxxxxxxxxx, "richellen" <richandellen@xxx>
wrote:
>
> Super,
> Typically how long do you hold a position?
> If one is day trading I can't believe there is even much of a need
for explorations except for adequate volume and daily atr, IMO..
> Dick..
> ----- Original Message -----
> From: superfragalist
> To: equismetastock@xxxxxxxxxxxxxxx
> Sent: Monday, June 23, 2008 2:35 PM
> Subject: [EquisMetaStock Group] Re: Big's HHV Needs help
>
>
> Explorations are not very good at picking stocks to buy, no matter
> what the constraint equations are or how many backtests have been run.
> Discretionary judgment is always necessary to pick among the
candidates.
>
> Explorations should probably be called preliminary screenings. When I
> first started trading many years ago, I tried the concept of
> explorations as preliminary screens and tested the results. I found
> that using screens based on fundamental analysis and quantitative
> analysis produced a far superior pool of trading candidates, so now I
> only trade equities from Value Line's T100 list or IBD 100. The only
> exception is the ETFs I use for asset allocation strategies.
>
> Somebody will probably post that they need mechanical systems to take
> the emotion out of trading. I've written several articles on why the
> only thing mechanical systems will take out is money from the user's
> wallet, so I'm not going to repeat all of that here.
>
> As far as shorting goes, it's a much more difficult method of trading.
> There are formulas for X% off of high. They're easy so someone else
> can supply it to you, but you might want to consider forgoing shorting
> until you are consistent and really good at long side trading. You'll
> have a better chance of success trading the long side, but only in
> uptrends. Trying to trade through sideways markets and downtrends is
> not a very productive idea, but everyone seems to need to reinvent the
> wheel themselves or give a lot of money to the so called "gurus"
> before they realize the "gurus" don't trade for a living. As I've said
> before, they sell products. Almost all of the guru's I know
> personally, and I know several, use an asset allocation investment
> strategy for the majority of their money. Sometimes they keep just a
> little in the their trading account so they can say they trade, and
> then some don't trade at all. They never publish any prior long term
> trading results or backtests reports using their methods.
>
> In my experience, I've found the guys on the motley fools mechanical
> investing board make more money more consistently than the guys who
> are on the TA boards. I've compared the long term trading records from
> as many practitioners of both methods as I've been able to find.
>
> Their version of a mechanical system is based on FA and QA and buying
> and holding for specific periods of time. That kind of mechanical
> system works fairly well. That's one reason why I use a hybrid with
> the VL stocks and IBD stocks.
>
> Anyone who wants to spend some time looking can find the same data and
> draw their own conclusions from it.
>
> Anyway, whatever your cup of tea is drink up and have fun! Tea can get
> expensive so drink sparingly at first.
>
> Super
>
> PS Don't forget to test everything thoroughly for long and short
> strategies. Don't trust any set of equations that haven't been tested,
> no matter where they came from. And remember, you're always going to
> do worse than the tests results suggest so make sure the Monte Carlo
> testing covers a lot of possible situations and there is a wide moat
> of positive possibilities.
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "Big Papa" <denver69692002@>
> wrote:
> >
> > Thanks, that helped out a bunch. Both of the suggestions seem to
> > increase the amount of stocks that pop up on the screen. Not
sure if
> > that is good or bad.
> >
> > Still looking for some help on the "if it goes down X %, then
short,
> > part". Is there a way to even program such a thing?
> >
> >
> > --- In equismetastock@xxxxxxxxxxxxxxx, superfragalist <no_reply@>
> > wrote:
> > >
> > > Oops,
> > >
> > > H1:=If(H>=HHV(H,60),1,0);
> > >
> > > should be
> > >
> > > H1:=If(H=HHV(H,60),1,0);
> > >
> > > No big deal, the extraneous > does nothing.
> > >
> > > Super
> > >
> > >
> > > --- In equismetastock@xxxxxxxxxxxxxxx, superfragalist <no_reply@>
> > > wrote:
> > > >
> > > > Big,
> > > >
> > > > Here's a formula I've tested and written about for Roy's
> > newsletter. I
> > > > think it will give you what you're looking for. You can
tweak the
> > > > parameters a bit but I don't think optimization really brings
> > much to
> > > > this party.
> > > >
> > > > V1:=Mov(V,90,S);
> > > > V2:=Mov(V,5,S);
> > > > VBuy:=If(V2>V1*1.5,1,0);
> > > >
> > > >
> > > > H1:=If(H>=HHV(H,60),1,0);
> > > >
> > > > H1>0 and VBuy>0
> > > >
> > > > Super
> > > >
> > > >
> > > >
> > > >
> > > >
> > > >
> > > > --- In equismetastock@xxxxxxxxxxxxxxx, pumrysh <no_reply@>
wrote:
> > > > >
> > > > > Big Papa,
> > > > >
> > > > > Had some time to review and play with your exploration
formula.
> > > > >
> > > > > Here's what I'm seeing.
> > > > >
> > > > > There are two important factors being explored here.
> > > > >
> > > > > First, the HHV is acting as a trailing stop/indicator. Using
> > the
> > > > > lookback period of 260 will keep you out of consolidation and
> > whipsaw
> > > > > markets but has the drawback of getting you into a trade
late.
> > > > > Realize that 260 periods would encompass the highs of over a
> > years
> > > > > period of time. Several changes that you could consider would
> > be to
> > > > > shorten the lookbacks or use either a moving average or ATR
> > based
> > > > > indicator here.
> > > > >
> > > > > Second, volume is a fickled lady. I am somewhat skeptical
that
> > it is
> > > > > ever reported accurately. We also seldom know for sure
whether
> > its
> > > > > buying volume or selling volume. In your case the exploration
> > is
> > > > > turning up more selling volume than buying. This is probably
> > due to
> > > > > the restriction that the HHV is putting on it. By using the
> > single
> > > > > day volume in comparison to its moving average you are seeing
> > more
> > > > > spikes which can also be throwing off your exploration. You
> > may want
> > > > > to consider using short term moving averages of volume
> > instead.
> > > > > Something like:
> > > > > Mov(V,5,S) > Mov(Mov(V,5,S),5,S)
> > > > >
> > > > >
> > > > > Hope this helps,
> > > > >
> > > > > Preston
> > > > >
> > > > >
> > > > >
> > > > >
> > > > > --- In equismetastock@xxxxxxxxxxxxxxx, pumrysh <no_reply@>
> > wrote:
> > > > > >
> > > > > > Big,
> > > > > >
> > > > > > PDO is one of those that you would like to find especially
> > if you
> > > > > > could find it in April and sell it in May and before it
> > tanked on
> > > > > the
> > > > > > 22nd.
> > > > > >
> > > > > > What I noticed was that it fell into a trend, albeit a
short
> > one.
> > > > > >
> > > > > > Question is how to do that and not to catch the ones that
> > are
> > > > > highly
> > > > > > volatile and tank the next day.
> > > > > >
> > > > > > Several things I would play with. The HHV has a 260 period
> > > > > lookback.
> > > > > > I would probably shorten that. I would probably up the
> > initial
> > > > > stock
> > > > > > price as well. $2 stocks are usualy being
played/manipulated
> > by the
> > > > > > hucksters, so I would probably bump that number to $10.
> > > > > >
> > > > > > A good trend filter would also be nice to include. Several
> > come to
> > > > > > mind. Obviously the idea is going to be to jump on the
trade
> > early
> > > > > > rather than late. Let me play with a few and see what looks
> > good.
> > > > > >
> > > > > > Finally, you are going to need a very good trailing stop. I
> > think
> > > > > > Andy just mentioned a good one but there are others.
> > > > > >
> > > > > > Will get back to you with more in a bit.
> > > > > >
> > > > > >
> > > > > > Preston
> > > > > >
> > > > > >
> > > > > >
> > > > > >
> > > > > >
> > > > > >
> > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "Big Papa"
> > > > > > <denver69692002@> wrote:
> > > > > > >
> > > > > > > What I have found is that the stock will behave wildly
one
> > way or
> > > > > > > the other, right after it is found in the exploration.
> > > > > > >
> > > > > > > For instance, it caught PDO around Mid May around $14.85
> > before
> > > > > it
> > > > > > > took off to 15.74 the next day, $22.85 on day 3, etc.
> > > > > > >
> > > > > > > It also caught UFPT around the same time, it crossed my
> > > > > magical "X"
> > > > > > > percentage, and was down 35% 20 trading days later.
> > > > > > >
> > > > > > > During the first week in June, it caught XCO at $26.96,
> > which was
> > > > > > at
> > > > > > > $34.31 10 days later, and GEOI at $27.13, down 23% 10
days
> > later.
> > > > > > >
> > > > > > > Thoughts?
> > > > > > >
> > > > > > >
> > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, pumrysh
<no_reply@>
> > wrote:
> > > > > > > >
> > > > > > > > Big Papa,
> > > > > > > >
> > > > > > > > I believe somethings askew with this exploration.
> > > > > > > > C>0 should be C>Open not zero.
> > > > > > > > Next when I plotted the code as an indicator on a price
> > chart
> > > > > of
> > > > > > > > several stocks what I saw was selling opportunities not
> > buying.
> > > > > > > >
> > > > > > > > Preston
> > > > > > > >
> > > > > > > >
> > > > > > > >
> > > > > > > > --- In equismetastock@xxxxxxxxxxxxxxx, "Big Papa"
> > > > > > > > <denver69692002@> wrote:
> > > > > > > > >
> > > > > > > > > I have an explorer. End of Day type set up.
> > > > > > > > > C>=2
> > > > > > > > > AND
> > > > > > > > > C>0
> > > > > > > > > AND
> > > > > > > > > C>=HHV(H,260)-HHV(H,260)*0.10
> > > > > > > > > AND
> > > > > > > > > C>Ref(H,-1)
> > > > > > > > > AND
> > > > > > > > > Mov(V,30,S)>1000
> > > > > > > > > AND
> > > > > > > > > V>=Mov(V,30,S)*2
> > > > > > > > >
> > > > > > > > > I have been paper trading this for a month or so, on
> > next
> > > > > day,
> > > > > > > > > 3,5,10, and 20 day results.
> > > > > > > > >
> > > > > > > > > My buy formula will buy all stock that pops up on the
> > screen.
> > > > > I
> > > > > > > buy
> > > > > > > > > at the opening of the next day.
> > > > > > > > >
> > > > > > > > > My sell formula is a little bit trickier.
> > > > > > > > > If the stock declines more than x% from the close of
> > the day
> > > > > > > > > previous to when I buy, I want to sell, and move to a
> > short
> > > > > > > > position
> > > > > > > > > right away. The equities that don't stop out, I'll
let
> > run.
> > > > > > > > > I need help with that formula, both for the sell of
> > the
> > > > > initial
> > > > > > > > buy,
> > > > > > > > > plus the automatic buy of the short position.
> > > > > > > > >
> > > > > > > > > Any help for the exit would be nice too.
> > > > > > > > >
> > > > > > > > > Thanks,
> > > > > > > > > Big Papa.
> > > > > > > > >
> > > > > > > >
> > > > > > >
> > > > > >
> > > > >
> > > >
> > >
> >
>
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