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If you follow a system your follow it. I mean you take ALL signals. If you
follow two, you follow the two, taking ALL signals. Or you are not following
two systems but filtering one with the other which is yet another system.
In a word, it doesn't matter what position a system advocates, you take it
period. Any discussion about the pertinence of being long or short is
irrelevant, and has no place in a mechanical trading approach.
If the two contradict, you buy for the first and sell for the second. You
may even do so physically. I used to follow 4 systems simultaneously on
bonds. Typically, I had to buy 10 bonds for the first two and sell 6 bonds
for the second. I bought 4 net, but in my trading log, I recorded a long of
10, a short of 6 and saved commissions and slippage on the execution.
Sometimes I got greedy, so I tried to buy 4 on the bid, and sell 6 on the
offer, making a positive slippage... Key is to not think, only act on the
signals: Buy, buy, sell, buy, sell, sell, buy, buy, sell... In the morning I
usually didn't remember whether I was short or long and by how much... I
actually like that setup.
Best to you,
Gwenn
Mervin Yeung wrote:
> Hi RTs,
>
> Does any RT use more than 1 trading system? What would you do if
> different systems come out with opposite forecasts?
>
> Give you an example. March 2000 cotton. If you use MA cross over, you
> still have short positions. If you use breakout rule, you probably have
> gone short but got out today because you are afraid this thing is doing
> a "false breakout". If you follow trends AND adopt "buy breaks, sell
> rallies" axiom, then you are waiting for this rally to finish its surge
> and go short again. If you like to pick the tops and the bottoms, now
> it is the time to go long. If you use "Purple System" (An unorthodox
> application of an ancient Chinese Astro. method), then cotton will shoot
> up vertically and never look back. .......etc. There are hundreds of
> systems that give you all different forecasts. No wonder is trading
> difficult!
>
> I think consciously and subconsciously, deep our mind, we must be at
> peace with our methods. For example, Norman often gave us his Astro.
> forecasts, which are often quite accurate. (In my opinion) However, I
> simply could not bring myself to trade on Astrology because I studied
> too much Physics and Math. in college.
>
> However, I always love to see Norman's forecasts.
>
> All the above are for general information only, not for trading
> purpose.
>
> Mervin
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