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>Mark,
>
>Very interesting. So you prefer the simple approach but Star Wars is
marginally better?
Actually for me and there are some who know me close on this list and they
are all laughing right now. I prefer the most mind boggling complicated
method of trading that I can luck ( more like hard work ) upon. This gives
me a feeling of accomplishment and some security that not everyone will be
placing their orders where I am.
> Makes me wonder why spend the huge increase in time and effort for a Star
Wars setup when a channel breakout will do?
Yes, the breakout will perform well if you are lucky enough to happen upon
the perfect combination of markets to bundle together. At this point I guess
I should have classified trading systems into groups. I should say that if
you are going to trade on daily data the that would be a group of systems
and if you trade less that would be yet another group. I dont believe weekly
would apply to any here much so I'll skip that group and monthly completely.
For a daily system it seems the popular Channel Breakout systems work, yes
there I said it. The trick is to have deep pockets, and be able to have
some YEARS that you dont make a dime an in fact loose money. Of course the
first year a person trades that optimized portfolio will be the biggest
single drawdown experience of the systems entire life but what do I know?
Then we now get to the < less than daily systems and we find a bulk of
useless curve fitted make you feel good systems. What do I mean? systems
that supposedly have low drawdown and high return and high percentage of
winning trades. Wanna buy it? they sell one on every street corner. Or
maybe its not the systems maybe its your psyche thats out of wack and I'm
sure that a few on the list here have a solution (for a nominal fee) for
that. So what works? What works is what doesn't feel good and looks
worst. If you look at a chart and you like the positions of the buy and
sell arrows, then it probably doesn't make any money. If you have
indicators that look great as if by magic they catch the tops and bottoms
then they probably do so in history and not real time. I believe there are
many ways in which a system can beat the markets. I just dont think there
are many that are successful that are selling their methods. I will admit
that I have run some numbers and it would be quite profitable to sell a good
system. But it would surely blow apart as the masses all jumped on it. I
know for a fact that this theory of the more the merrier doesn't work, that
is dead wrong. If you have nothing but buyers or sellers who's going to be
on the other side of the trade? Heard mentality doesn't work for anything
but heard animals. So thats why you have to be a floor trader for this
method to work for you...(a small jab at our floor buddies on the list, in
good nature of course).
Mark Brown
p.s. I'm digging out those math links
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