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Robert,
This was the exact style of Lateral Trading: Taking small profits and
adding to losers. Maybe commodities do have different properties, but what
do you define as Historic lows. Lows in past 5 years (there goes Gold
trades), 10 years (there goes most commodities). Anything further and what
do you get to trade?
David Hunt
http://homepages.tig.com.au/~adest
----------
| From: Robert Must <rmust@xxxxxxxxxxxxxxx>
| To: adest@xxxxxxxxxx; RealTraders Discussion Group
<realtraders@xxxxxxxxxxxxxx>
| Subject: RE: channel breakout
| Date: Monday, February 16, 1998 12:40 PM
|
| Sorry, but it is clearly written in the Wiest's book not to
| trade futures and equities and other financial instruments
| that may be influenced by other circumstances than simple
| supply and demand. As far as I am aware Victor Neiderhoffer's
| approach was not even close to 'scale trading' and if you recall
| he has lost on equities and financial instruments. Meanwhile, a
| commodity is something that is not physically affected. Gold will
| be gold and hogs will be hogs even in 300 years.
|
| Though you can attempt the trades at historical lows, do not
| risk to much, and take small profits on pre-set scale instead of hoping
for
| a big windfall. It may not be the bottom, yet. Surely
| no one knows what actual low will be the time you trade. Scale trading is
| not a dollar averaging strategy (though may look
| similar at at the very first glance) and should not be confused
| with it.
|
| Robert
|
| The truth is out there...
|
| > -----Original Message-----
| > From: owner-realtraders@xxxxxxxxxxxxxx
| > [mailto:owner-realtraders@xxxxxxxxxxxxxx]On Behalf Of David Hunt
| > Sent: February 15, 1998 8:25 PM
| > To: RealTraders Discussion Group
| > Subject: Re: channel breakout
| >
| >
| > Michael,
| >
| > In Australia we had a well publicised CTA - Lateral Trading - that
just
| > blew up using "Scale trading".
| > Talk to the uninformed investors who ploughed Millions into this fund
| > before they lost millions and they would have said "I don't understand
it
| > but it sounds good so it must work". Know I guess they are too
| > embarrassed. Trend Following like the Turtles may have its drawdowns
but
| > overnight blow ups are very unusual for Trend Followers - if things are
| bad
| > its a slow death!!
| >
| > Scale Traders can be heros for a long time and be bankrupted over
night.
| >
| > >From Elders Reveiw: You Can't Lose Trading Commodities
| > Robert F. Wiest
| >
| > Hard cover, 392 pages, $50
| >
| > Summary: If you are properly
capitalized
| > and trade
| > reasonable size, you can sit out those
| > trades that move
| > against you and make money in the end"
| >
| > Didn't Victor Neiderhoffer also use a version of this and he blew up?
| >
| > NO ONE IS BIGGER THAN THE MARKET. "REASONABLE SIZE" WOULD MEAN 1% or
less
| > of your portfolio. Not a reasonable chunk of your portfolio.
| >
| > David Hunt
| > http://homepages.tig.com.au/~adest
| >
| > ----------
| > | From: Michael Ferguson <Michael.WL7BDN@xxxxxxxxxxxxxxxx>
| > | To: bshumake <bshumake@xxxxxxxxxxxx>; RealTraders Discussion Group
| > <realtraders@xxxxxxxxxxxxxx>
| > | Subject: Re: channel breakout
| > | Date: Monday, February 16, 1998 8:10 AM
| > |
| > | Bill and Traders,
| > | This leads me to ask what you think of the scale trading system in
| > Robert
| > | Wiest's "You Can't Lose Trading Commodities". I don't have the book
yet,
| > | but I am ordering it. You can find a description of the book and
trade
| > | potential at http://www.elder.com/bookpages/WIEST_YO.html. Any
tie-ins
| or
| > | experience with this?
| > |
| > | Michael
| > |
| >
|