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You're correct. I buy with the intention of holding for weeks, months,
sometimes years. Doesn't always work out that way (I can get stopped out) -
but my anticipated time frame is certainly a lot longer than yours is. I will
say one thing about systems - they give you discipline (if you follow them).
Which is probably why money management systems are more important than most
other systems.
I'll give you a good example of a lack of discipline from my own personal
experience - bonds near the end of 1994. Everything told me we were near a
bottom - and I bought a fair amount of bonds. The next day - bonds tanked a
point - and I thought I'd been mistaken - and got frightened. So I sold
everything I bought the day before. The next day - bonds rallied - and then I
was sure I'd been right (albeit a day early). So I bought everything back (and
I'm still holding a lot of it). This was before the days of computer trading -
and you feel like a real dummy doing this (especially when you've been dealing
with the broker for about a decade - and you can tell he thinks you're
experiencing a bout of temporary insanity). Had I been disciplined - and stuck
to my guns - I wouldn't have paid the spreads for a buy/sell/buy back (which
aren't insignificant in the cash market).
Anyway - the point is that discipline is important - no matter what your time
frame is - whether you get your discipline from a mechnical system - or from
somewhere else. And - if your discipline fails you - don't be afraid to admit
you've made a mistake buying - or selling - and don't sit there wishing and
hoping that the market will go in the direction of whatever your current
position is when it's clear that the market isn't obliging. Wish I could say
I'm 100% perfect in this - but I'm not - and my imperfections have cost me
money. Robyn.
Andy wrote:
> I'm a strong believer in systems trading/testing and I disagree strongly
> with Robyn and ATom.
>
> The root cause of our disagreements about trading systems is our different
> approaches to the markets. As I understand it,Robyn, you select a position
> and hold it for several days, weeks or even perhaps several months...
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