Comments on: WHY YOU (LIKELY) TRADE LIKE A LOSER

By: Bob G.

Bob G. — Tue, 13 Oct 2009 23:10:02 +0000

Good opportunities to trade and have an edge are much more infrequent than most realize. Great buying opportunities come along every 4-5 years in equities. Finding a way to accurately measure the fear level of the masses is one of the keys to know when to scale into the market and subsequently scale out.

By: Will

Will — Wed, 08 Jul 2009 08:46:38 +0000

ahh,

i didnt realise you were trading in a fund, i can certainly understand taking a conservative approach.

another way of increasing exposure is;
-increase no. of trades

but the practically of this would depend on your market/ timeframe, etc
-which im sure your aware of

best of luck;
will

By: TPC

TPC — Tue, 07 Jul 2009 16:03:19 +0000

Will, thanks for the great comment. I have looked at ways of increasing my risk exposure. As you said, I certainly have the wiggle room. I would likely take on a lot more market correlation which is not something I am fond of, however. Investors love my low vol, low correlation returns. My clients sleep at night and so do I.

I am actually working on a new strategy that would certainly increase volatility and overall market exposure substantially, but it’s still a bit of a work in progress.

I’d love to hear your thoughts on doing so. Sounds like you know a thing or two about this.

By: Will

Will — Tue, 07 Jul 2009 15:52:13 +0000

Hi TPC

It is by shear chance that I stumbled across your article;

“I have never experienced a draw-down of more than 15% in any given quarterly period because my risk management is superb.”

if those are your true results,
-I would say it would be prudent to consider increasing your risk say 2 fold.

-doubling your expectancy/ max drawdown 30%/ x2 losses/profits, etc, etc
– it seems like you have the wiggle room.

i’d like to hear your thoughts;

regards,
Will

By: prescient11

prescient11 — Wed, 24 Jun 2009 03:31:11 +0000

My biggest rule is don’t let fundamental knowledge affect what is happening on the charts. If you trade intraday, trade with a backdrop of knowledge but don’t let it guide you completely.

And it’s discipline folks, discipline. That should be at everyone’s desk.

BE WILLING TO TAKE THE LOSS. If you were perfect we would all be millionaires!!

Great article TPC, look forward to reading your strategies.

By: Aki_Izayoi

Aki_Izayoi — Tue, 23 Jun 2009 22:54:34 +0000

I think the key to being a good trader/speculator is to know what you are doing. Yes, you are a trader… TRADER!!! Remember, they are TRADES, not free money. Ask yourself why do people take the OTHER SIDE of your trades.

Another key that I ask myself. Do I have an information asymmetry or lower intertemporal discount rates (allows you to take more short term volatility for long term gains) over other traders? Trading is zero sum…

By: Nat

Nat — Tue, 23 Jun 2009 22:39:21 +0000

As a fairly new investor (about 4 months now) I can attest to those points. I am a big loser overall and am realizing my failure is “failing to plan a strategy” and my emotions. I hope I take your excellent advice and start over. Thanks for the great piece of advice!

By: Simon

Simon — Tue, 23 Jun 2009 19:56:40 +0000

Hi TPC,

My formula:

~Scope
~Size
~Stop
~Target
~Duration

I find patience is the toughest part – just letting the trade ride.

By the way, great post.

Thank you

By: SRSOwner

SRSOwner — Tue, 23 Jun 2009 19:42:20 +0000

currency markets I mean. TPC you need an edit button.

By: SRSOwner

SRSOwner — Tue, 23 Jun 2009 19:41:22 +0000

Soros made one big bet on the commodity markets and got lucky. If that trade had gone against him no one would ever know who he was.