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Gwenn
I'm interested in your comments re P&F. My queries/comments are in
brackets.
Regards
Graham Critchley
Box 330
South Melbourne VIC 3205
AUSTRALIA
Phone 0416 171 006
Intl Ph 61 416 171 006
E-Mail gcc@xxxxxxxxxxxxxx
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> From: Gwenn Aël Gautier <Gw.Gautier@xxxxxxxxxx>
> To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
> Subject: Re: trend following
> Date: Monday, 23 February 1998 20:12
>
> Paul Cote wrote:
> >
> > I would like to get feedback from person's who have traded a trend
> > follwing channel breakout methodology and would like to know how they
> > liked it.
>
> With such methods, it is imperative to diversify over a dozen markets at
> least as congestions eat you alive, and markets trend only 25%to 35% of
> the time in the best case. Profitable ratio rarely exceeds 40% and
> often ranges from 25% to 35%, hence it is really important to have
> nerves of steel and still trade after 10-20 losses in a row. Last but
> not leasrn whenever you get a nice winning trend, by all means find a
> money management strategy to press the winner so it pays more than all
> other losses combined...
>
> > I would also like to hear about any comparisons of trend
> > following using channel breakout and point and figure method.
>
> Point and figure has the advantege that few people use it (mainly floor
traders), so you have a slight edge here, however since it filters a lot of
moves (noise), prices can adversely travel a lot (depends upon the box size
& reversal) before you have an exit signal. Beware of mechanical testing
(I'm unaware of mechanical testing of P&F - would like to know more), real
time results often diverge vastly from historical results over the same
period, because of the nature of the plottting of P&F (kindly expand upon
this).
Gwenn, my experience is that P&F is conceptually sound and devoid of goobly
gook often found in TA. I genuinely invite your responses.
Regards
Graham
> Gwenn
>
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