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Correction: that should be a 50% win ratio system .. not a 50%
return system.. Freudian slip.
--- In equismetastock@xxxxxxxxxxxxxxx, "rvalue1" <rvalue1@xxx> wrote:
>
> I find that few people take the time to do intensive backtesting.
> Super does it. I have spent many hours testing electronically and
> even more manually. I hedge and use stocks and put options in an
> integrated system. Works for my risk level and helps me get a
> smoother equity curve in up and dn markets. . Most trading systems
> have poor results and very few provide high return percentages. A
> 50% win ratio system with a 1.5:1 win:loss ratio is not unusual.
That
> means you will run into 5 bad trades in a row with 90% confidence
if
> you trade it for a while. Risk management becomes critical to
> survive those drawdowns and a supreme confidence in the system to
> pick up the gains that follow.
> The few that do well - after hours and hours of development time,
> there are few reasons why anyone would just spill it out on a site
> like this free and at no charge..
> I have found 9 out of 10 softwares sold for Metastock a waste of
> money. Books are no different. One of my favorites is a
> recommendation from Super years back - so I would suggest paying
> attention to his suggestions.
> - And does anyone have a good recommendation on books dealing with
> trading systems using dual or multi time frame analysis? I haven't
> found any.
>
> Regards..
> --- In equismetastock@xxxxxxxxxxxxxxx, superfragalist <no_reply@>
> wrote:
> >
> > I've read a lot of trading books. Probably well over a 100.
> >
> > None of the TA books I've read have ever had any kind of method,
> > strategy or system that tested out well except during strong
market
> > trends. Very few of the books have ever included any
substantial,
> or
> > even much in the way of unsubstantial, test data that is of any
> > quality or value. I wonder why they left that out since it is
> critical
> > to evaluating any trading strategy?
> >
> > Here are a few books with unbiased test results that will give
> anyone
> > a clear understanding of what TA can and won't do for them.
> >
> > Thomas Stridsman includes comprehensive test results in his books
> > Trading Systems that Work and Trading Systems and Money
Management.
> > Those are eye opening also. Stridsman tests trading strategies
for
> > hedgefunds so he's no dope.
> >
> > The Encyclopedia of Technical Market Indicators by Robert Colby
> has a
> > lot of long term test results on a variety of indicators and
> trading
> > methods. Another eye opening book.
> >
> > The Encyclopedia of Trading Strategies by Jeffrey Katz and Donna
> > McCormick is very comprehensive in examining all kinds of trading
> > methods. This is a good breadth book.
> >
> > Evidence Based Technical Analysis by David Aronson is tough to
> read in
> > places, especially for those who don't understand or like
> statistical
> > analysis, but it will disabuse those who think that TA is a
magical
> > method of making money. I've said before my opinion and
experience
> is
> > TA provides little help in making money unless there is a
confirmed
> > trend in the market. Then TA provides a little assistance.
> >
> > Here's my opinion on what works on US equities.
> >
> > Limit your trading to uptrends from Oct 1 to May 30 or some other
> > market conditions filter that you've tested.
> >
> > Trade from a list of stocks prescreened by fundamentals and
> > quantitative methods. I use Valueline but there are other lists
> that
> > are also good.
> >
> > Use a simple trading method.
> >
> > Keep your portfolio to 25 or so stocks.
> >
> > Okay, so do I apply the same scrutiny to myself as I do others in
> > regard to backing up their methods with test results? You bet.
I've
> > tested this stuff and many of the test results were presented in
> Roy's
> > newsletter over the last few years.
> >
> > Sure others will disagree with this method. No problem. Just ask
> them
> > for their test data, and if the test results look good, cover a
> broad
> > range of market conditions and meet rational testing methods,
> they've
> > got something worth looking at.
> >
> > Super
> >
>
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