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Dear Doc and others,
In the most recent edition of Futures Magazine,there is a list of CTAs.
The range of gain for them was 45%to73% for 1997 and many of them are system users.
More importantly worst drawdowns ranged from 15% to 68% which was also the best performer.
Most of you know my position on mechanical trading--there are good ones but you need the discipline to tough out the drawdowns.I am currently going through one right now but that is the nature of the business and I am sure why some successful people leave it.The stomach can only take so much.
So if your heart is in trading,you will have ups and downs no matter what approch you take-but there is nothing wrong with keeping an open mind.
Mechanically yours,
John
------------------ Reply Separator --------------------
Originally From: THE DOCTOR <droex@xxxxxxxxxxxx>
Subject: Re: GEN: Worthless Pursuit
Date: 03/07/98 01:07pm
Trot,
You clearly raise a number of points that all of have pondered,considered
and examined over many years and many trades.
I know a good many folks who are successful at trading and many are
chronicled in Schwager's books(Market Wizards and New Market Wizzards)as
well as Alan Rubenfeld's "Supertraders". I've even seen certified results
of a good many very.very successful folks and only a very few have something
to sell. I've also seen the trading results of many of the most "well know"
and vocal Peddlers. Like you one quickly draws the conclusions you draw.
Having said that the issue becomes what is really worth learning and what is
hype.
THE BEST TRADERS IN THE WORLD aren't really good at making money. THEY ARE
- IN FACT- SUPERB at not LOSING IT. IMHO that is the key...I learned a long
time ago that without genuine certified results(I work for the CBOE which
gives me the unique opportunity to view actual trading performance)there is
more lying about trading results than there is about sex. Generally the
more visible the bigger the lie.
The really good people RARELY HAVE A PRODUCT TO SELL. Ironically some of
the best people have their stuff available for free....Sheldon Natenburg's
volatility seminar is a give a way....Tom Dorsey's point and figure work is
a give a way....Terry Haggery(an associate of mine at CBOE and probably one
of the finest option minds around)is a give a way.
Having said that the key is quality education.......not trying to buy a
quick answer silver bullet system. Read the chapter in "NEW MARKET WIZARDS"
about Blair Hull.
Blair trades dozens of market everyday....with an incredible disipline...and
earns more than some fortune 500 companies.
Don't give up...KEEP LEARNING.....avoid the "experts....gurus......fake
wizzards..and peddlers." Much of the good stuff is free and almost all the
crap is overpriced.
Troy Kelley wrote:
> I am about to start trading on a system I have worked hard on, but I am
> beginning to wonder whether this is a worthless pursuit.
>
> Reasons: Larry Williams doesn't trade, he sells his stuff. Neiderhoffer
> went bust. Tom DeMark doesn't trade. Schwager doesn't trade. Linda
> Rasche doesn't trade any more. Richard Dennis had a 60 percent drawdown
> last I heard. I am not sure if Gann really ever made any money. These
> are the biggest players in this world, and they don't make a living from
> purely trading. I am wondering if all these people just had a lucky
> streak and now all they can do is sell their "knowledge".
>
> When I started this, I assumed that if I could predict the direction of
> the market I would make money. But now I realize that prediction is easy
> compared to actually making money from the prediction. I think this is
> also what Larry, Linda, Tom ect..all these other people realize.
> Prediction is easy, making money from the prediction is hard. And once
> you start making money, making money for extendend periods of time is
> almost impossible.
>
> I think the real problem is not figuring out the randomness of the
> market, but dealing with all the competition of the market players. We
> are all taking money from each other. We are all smart people and we
> don't like loosing money. This makes for an incredibly competitive
> environment. It also means that no one, no one, will stay on top for
> very long.
>
> Just some thoughts. I welcome any replies.
>
> Troy
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