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My daytrading system for the S&P 500 must be in a draw-down... is there any
data,
studies, or information in general about how long a draw-down period should
last? I'm getting stopped out left and right... I've decided to go back to
paper
trading until the draw-down period is over -- hopefully I've got enough
money in
reserve to cover my butt in the meantime.
Although the last 5 trading days in March didn't work out very well for me
(that's
when my draw-downs started) I still made 260% ROI after commissions and
other costs.
In February I made a 464% ROI... with just 1 losing day... a loss of $423.
In January I made an 83% ROI... with just 1 losing day... a loss of $2,020.
Now, here we are in the end of March and April and I've lost 31.7 points
($7,925)
in the last 2 trading days... due to getting stopped out from the
whipsawing in
the price movement. (My research shows an optimum stop placement to be
4.8 points in the S&P -- Risking $1,200 per trade).
I understand draw-downs are inevitable... but being fairly new to this game
(just
under 2 years) I'm concerned because this is how I've been making my living
for over a year now. Any advice or suggestions are welcomed.
Warmly,
Brian Voiles
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