my journal 2

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time to scale up on my account

Wow, thanks, Cara hypnotist. I just fell asleep and slept for at least half an hour, despite my parents being in the house and yelling. Let alone that the last time I slept during the day was months ago.

Today some big money was made on both accounts thanks to ZN_ON_2 (over 1000 right now). If it ends like it looks right now, I will ask my investors who have a golden share in my account if we can add an extra system.

Let's select it here, with max drawdown and margin in mind, doing a scatter plot with overall performance and number of trades:

Snap1.jpg

I marked in green the one we're already trading (one is not showing because it hasn't traded enough and it's not shown on the scatter plot).

I have marked with a red circle those we cannot trade because need too much margin.
I marked in purple those we cannot trade because they are not good enough or have not traded enough.
I marked in orange the one we cannot trade because it interferes with the other ones we're trading in terms of margin (we have enough margin to trade it, but it is likely to cause us to miss a trade by the other systems).

This leaves us with two excellent systems: GBL_ID and GBL_ID_2.

I just checked the GBL_ID and guess what - my best system is not that good at all. It has a Sharpe Ratio which is very good for the latest out-of-sample, but very bad actually for earlier periods: 0.2. Look at its performance:

GBL_ID.jpg

It looks like we've just been very lucky using it lately. It could stop working any time and take us down 10k, like it did before (the years shown on the chart are 2005-2010). It has a potential drawdown of 9k. We cannot trade it now, by all means.

The GBL_ID_2 is a whole different story. It has a maximum drawdown of 400 dollars and, despite its few trades, its equity curve just goes straight up and has performed in the out-of-sample just as well as in the in-sample.

GBL_ID_2.jpg

Total profit is 5000 until a few months ago, and now it's almost 6k. This thing makes about 1000 per year. Better than nothing. Considering the margin at that hour it makes almost 100% per year. Yeah, it's not a joke. I will write the investors now to see if they allow it.
 
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tired...

Today we went to lunch with the boss and the good colleagues we have (the slacker weren't there today). Initially they wanted to go to the Chinese restaurant, but i said it was too loud and that I'd only go if they went to the Japanese restaurant. So we ate lunch at the Japanese restaurant I like so much because no one ever goes there and it's empty. And I paid for everyone. We were the only people sitting on their second floor.

The waiter I used to know, my friend basically, was no longer there. Maybe he's on vacation. I've been gone for several months, due to lack of funds. But today I paid because it was a special day, and I am grateful to the boss for having treated me greatly these two years, never complaining about my schedule (going late twice a week on average, and using my vacation days/hours to cover it).

That is also why I am still here now, stil at the office I mean. Before leaving tomorrow, he would like to have all the statistics for our suspicious transaction reports in order, so I had to finish classifying all the SARs we received for this year. The investors still haven't answered the email related to the above thread. I can't believe they're wasting time celebrating the bull**** conventional crap of new year and all that. Well, anyway, I need to relax and not rush things. That's why they have a golden share so they'll keep me from rushing things.

Let go. It's so easy to let go.

I am going home. And listen to the hypno-girls again.
 
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Back awake, as early as 5.54.

I wonder why.

I don't even remember what I wrote yesterday.

Sad mood.

That is what takes the place of my anger and frustration when it goes away. Let's say I solve my immediate problems such as vito and my father. Then I often get sad. Because I removed the worries, and yet no happiness took their place, since I am not engaging in any happy activities, ever. I mean, I haven't done it lately.

So it is strange, but maybe being frustrated, upset, mad and fighting with people, almost feel less sad than not being.

And probably, unless I bring some happiness into my life, I will look for more tough tasks and people to face and fight, rather than being sad, due to subconscious worries about death and other sad human conditions taking the place of the usual worries and frustrations.

In fact, I noticed that lately, having vito been gone, I have become very generous, probably trying to make myself happy by making others happy. And this is, as I said, because I have become more sad, after my enemies have stopped bothering me. And this is because my mind is not busy anymore. Here's an ever-increasing list of acts of generosity of the last three days:
1) bought hot chocolate and a pastry to a cab driver two days ago
2) bought hot chocolate and a pastry to the doorman two days ago
3) bought roasted chestnuts to a cab driver last night
4) treated to lunch my colleagues yesterday

This is not normal. Since Vito is gone and since my dad stopped bothering me, I've been in a better mood initially but then an "empty" mood took over, and I started getting frustrated again, and had to waste money, or rather give away money, so I could fill taht emptiness. Seeing the gratitude of people momentarily filled my sadness. Probably the most generous people are also the saddest and most desperate people. I would bet something on it.

I was just reminded of this expression:
http://en.wikipedia.org/wiki/Random_act_of_kindness

Let's see what it means. I have heard it somewhere before, I don't remember where, maybe on tv.

A random act of kindness (a phrase coined by Anne Herbert[1]) is a selfless act performed by a person or persons wishing to either assist or cheer up an individual (or even, in some cases, an animal). Either spontaneous or planned in advance, random acts of kindness are encouraged by various communities...

It doesn't say much else.

Hey, but this is just temporary and it has nothing to do with religion, radical changes in my philosophy or anything else. I am still praying for a stray bullet to hit vito on new year's eve. I am not planning to become a monk or give my life for other people's happiness. Rather, I am hoping vito will give his life to allow me a permanently more serene state of mind.
 
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Still at work.

Last few minutes under previous boss.

The new boss is already here, learning stuff, and he already asked me something for next week.

He wants detailed explanations of what we're doing on every page of the excel file reporting all our suspicious transaction reports statistics.

It's great to leave the ship last, like the captain, but I am not getting paid like the captain, and it's just a gesture but I don't actually want to stay here until midnight. I only wanted to stay a little longer, like 10 minutes longer than the majority.

It's one pm and he still hasn't asked me for the statistics, which I've already prepared for him and sent him. I hope he is not going home and forgetting me here. That wouldn't be funny. He also has to approve all my hours of leave of this week, since I woke up late and showed up late every single day of this week, and used up my vacation, but he still has to authorize it.

Why does a captain go down with his ship? - Yahoo! Answers

**** that, I am not going down with the ship. Then I don't want to be captain, just a passenger.

You know what really sucks? There's another guy, actually two other guys in the room next to mine, who usually just slack off, but they want to pose as captains going down with the ship today, so I have to stay here, and on top of it, not be the last one to leave. In fact the two slackers have been chatting for the past 4 hours. Certainly not the typical captains.

They keep their door open so everyone going by can see how hard-working they are. And all they do is talk. If they kept the door shut, at least they would get to work, but since they're just showing off, there's no point in keeping their door shut.

Oh, ok, now they're leaving. Finally. Luckily they didn't come to wish me a happy new year.

No, wait. Just one of them left. The other one is still there, talking, to someone who stopped by. No, wait, they're both still there.

Slackers.
 
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Re: tired...

Today we went to lunch with the boss and the good colleagues we have (the slacker weren't there today). Initially they wanted to go to the Chinese restaurant, but i said it was too loud and that I'd only go if they went to the Japanese restaurant. So we ate lunch at the Japanese restaurant I like so much because no one ever goes there and it's empty. And I paid for everyone. We were the only people sitting on their second floor.

The waiter I used to know, my friend basically, was no longer there. Maybe he's on vacation. I've been gone for several months, due to lack of funds. But today I paid because it was a special day, and I am grateful to the boss for having treated me greatly these two years, never complaining about my schedule (going late twice a week on average, and using my vacation days/hours to cover it).

That is also why I am still here now, stil at the office I mean. Before leaving tomorrow, he would like to have all the statistics for our suspicious transaction reports in order, so I had to finish classifying all the SARs we received for this year. The investors still haven't answered the email related to the above thread. I can't believe they're wasting time celebrating the bull**** conventional crap of new year and all that. Well, anyway, I need to relax and not rush things. That's why they have a golden share so they'll keep me from rushing things.

I am going home. And listen to the hypno-girls again.

Akemashiite Omedetto Gozaimasu
... and many more Japanese meals next year...:D
 
great gift by god

God has rewarded my systems finally.

This week we made back what we lost in the last 5 weeks.

Now the only system that we are still trading that still hasn't made any money is the GBP_ID_5.

We're ending the year (the investors and I) with a +2000. Better than nothing, considering we were at -2000 last Friday.

 
how many new year's eves were celebrated before?

Celebrating should not make us feel that we can control time. It is a damn foolish thing to celebrate the new year. It's totally stupid to celebrate your death approaching. I am going to bed a bit earlier so I don't have to be part of this crap.

 
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The mother ****ing boss, former boss. He was quite cold today. Yeah, he was nice to me for two years. But now I am pissed off at him, because he didn't say goodbye in a nice enough way. Screw him.

Well, he was all right. The best boss I've ever had.

Well, **** him anyway.
 
That's it. My parents are almost gone. They will leave tomorrow morning, early, while I will be sleeping.

I am sad and relieved.

Maybe it can be explained like this: I am sad that my mom is leaving and I am relieved that my dad is leaving.

Besides, the two of them together are even more unbearable, because when I am alone with my father, I can keep him in check and keep the conversation limited. We're like two colleagues at the bank, interacting only little, and working most of the time. When my mom is here instead, she forces us to interact more, with meals and such, and also because if she's here, my dad is home much more often. And usually they side together against me.

My dad is incapable of having a pleasant interaction with me. He is a control freak all the time. He has to be negative, control the situation, control the conversation, ridicule his interlocutor (whether me or my mom). It's a frustrating experience even after decades of knowing him.

In a sense he makes me build up the desire to destroy him, since he's always been in control of me and everything around me. He makes you feel like rebelling.

The typical conversation goes like this: he talks, you listen carefully and ask questions. You talk, and he doesn't reply anything and lets your topic die. He looks at you without nodding nor saying anything, until you stop or take a break. At which point he resumes his monologue.

I know I wrote about this just a few posts ago, but summarizing it is good: I learn to say it better and more quickly.

My dad is profoundly unfair. For all our lives my mom and I have had to put up with a family activity based on what he wanted to do and discuss at all times. He sabotaged in various ways anything we wanted to do or say. We felt very oppressed and reacted in different ways. My mom rebelling once in a while, like dropping some dishes and breaking them. I rebelled by skipping classes, failing grades... being a bad student and not caring about a business career. I connected any kind of authority with my father. Because he was the one telling me to study, so the teachers and him were one single block I had to rebel against. The problem is that he almost told me about every single subject in the world. So if he told me to tie my shoestrings for example, I'd feel like I'd have to rebel against that as well. If he told me to shave, I would not shave even if I wanted to shave. It's been terrible being told so much stuff and being criticized so much, so much that I had to reject even things I agreed with.

And I can't help but feel resentment towards my father. Especially since he never apologized and since there were no radical changes, and, as soon as he's comfortable again or he sees someone not opposing resistance, he resumes being himself: critical, sarcastic, negative, control freak, unpleasant.

And even his monologue are boring. At least, when he was in power he told us about what was going on in the country. Now that he's in the opposition, things are less interesting. On top of it, I grew tired of having to hear him lecture me about politics and about everything else. Now I feel like it's about time that he starts hearing about what I am interested in and listens to me and interacts and asks questions.

Throughout these holidays I have forced him to listen to me and even to ask me questions and give me some feedback. Today for example I told him about how the systems made a lot of money and that I was very happy, and he maybe listened, but he was quiet, didn't say anything, didn't nod, and, once I stopped, started a different topic. This is not what I call conversation. It's the succession of two monologues.

Does he want me to act towards him like he does with me? Not at all. It's just that he's spoiled and used to having his way. This is a big problem also caused by my mom and everyone else around him. But primarily my mom.

He chose her because he wanted a wife who would let him have his way: she was very insecure from the start and he treated her and treats her like an idiot. Then I was born.

I wasn't as happy to show the other cheek as my mom is, also due to her religious beliefs.

I rebelled, but not enough, and to this day I feel like I still want to rebel because he's still having his way too much.

The problem then expands throughout the world, because everyone around him is less important than him (in some social way) or in a few cases equal, so, especially since they're not relatives, they just keep quiet and accept to play humble, at least when they're with him. Maybe they talk behind his back, like I do.

Anyway, today we were having this conversation. As I was talking to him about my systems, not only did he not show any signs of interest, but when my mom asked him if he wanted some salad (she does that on purpose, and because she doesn't listen either), he took the opportunity to change the subject or rather to shift the focus on the food and stop listening to me - because he obviously did not care. But I cannot accept this. Why does everyone have to make efforts to listen to him and follow what he is saying and he can disregard what others say?

But don't get me wrong. It's not just the systems that bore him or that do not interest him. Anything I can say. Anything at all. He just wants to teach - he cannot learn anything unless he's the one asking the questions. You can't say "today I did...". At best, you're lucky if he interrogates you about something you did today. But the interrogation starts and stops when he wants to, and he regulates the speed of questions and decides how long your answers can be.

My mom and I can only talk when asked, as if he were the boss or something. If we talk when we're not questioned, then he ignores us.

No wonder I don't show any affection for him. He never showed any for me, no affection, no interest for what I was thinking. Just criticism and ridiculing towards my mom and me.

He has always been busy glorifying himself. He was always thrilled to be the center of the attention and the one being asked questions. But that's ok when you're someone important, it's ok in the sense that people let you do it, even if it's still unfair. But in your family you can't always act like your family members are your employees or admirers. You could even do that, if you paid them back with an equal affection and admiration. Instead we glorified him and got criticism and contempt and yelling in return.

What's even worse is that if you ask relatives and friends, since they don't have to deal with him very often, he's the greatest man on earth.

I guess the recipe for happiness running generation after generation is as follows. His father died when he was six, right after the war because of wounds from bombing I think. He was sent to a military school as a teenager, and was asked to be an adult ever since he was five. Then he spent the rest of his life trying to show everyone how much of a man he was and trying to impress everyone, and forcing his personality on everyone around him, especially of course his family. My mom was too weak to oppose any resistance, so I grew up hearing my dad say "don't be silly" to her several times a day, yelling, and condescending behaviours all the time, all lasting to this day.

Then in turn, I didn't grow up happy at all. My mom didn't exist, she was like a sister to me, a younger sister. I didn't have any real brothers or sisters. It was just me versus my father, ever since I was born. Of course I didn't win.

All I could do was fail classes and stuff like that. I could rebel but I could not rebel in any better way. I tried to win his approval by studying at first, but no grades were good enough to be told "good job".

I tried to impress him with sports, but I was not considered excellent, because he even told me that the least I could do was be the best at everything, and that should be normal for me.

So pretty soon I stopped trying, but i wasn't serene about that attitude either. Not just because he kept yelling at me all my life, but because he had instilled in me deep-rooted feelings of insecurity and guilt.

Then when you're insecure like that, and so frustrated from having put up with such an ordeal, other things go wrong. Or rather, a lot could go right, because how hard-working I was, but you don't even enjoy it. You could work your ass off at the office, but you won't go to the boss and ask for what you deserve in terms of position or salary. You could be good-looking, but you won't go up to a girl and ask her out. This is what happens when you grow up with someone telling you several times a day that you're worthless, no matter how well you do something and how hard you try. Regardless of my good performance, he kept telling me I was worthless. So whether you stop trying, like I did in some cases, or you try even harder (like I am doing for trading), your life is not going to be the same as everyone else's. You're going to be frustrated and discouraged. You're not going to be a happy go lucky person when you grow up with a father like that.

This explains why, after so many years, I am still resentful and still have not forgiven him. He may be just a sick person like many other sick people in the world, but I can't see him objectively, because he is my father, and I am the one who paid the consequences of his sick behaviour, and also because everyone else is still worshiping him and he hasn't apologized to me. I can't forgive someone who hasn't even apologized.
 
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Today we made big money. When, hopefully soon, we will reach 5000, we will be able to diversify. I am planning to ask the investors to add these systems circled in red. The ones in green are the ones we are already trading.

Snap1.jpg
 
my parents left

I feel a bit sad, as I said yesterday. The sense of relief for the end of the abuse is gone, and now I just feel sad.

Besides, the abuse wasn't much at all in the last 10 days. Maybe I abused them more than they abused me. By they I always intend to refer to my dad, because my mom is not really in the picture. The only problem is that she never helped me by taking sides with me against him, which is why he managed to stay mean and tough for so long - I was the only opposition. Forget the relatives: they're all in admiration and worshiping him.

Anyway, as I was saying, the resentment towards my dad is not as strong as to wipe out the sadness right now.

It is obvious that they both care for me, but my dad is a beast and is unable to show it. He is so tough and mean that he will utter mean and hurtful things out of habit. But this weekend he showed efforts, or rather... maybe weakness. Maybe he doesn't have the energy nor the resolve to be an asshole anymore. He doesn't have the will to yell at us anymore. The yelling was a daily experience with me and my mom - and with my mom it was totally unjustified. And also with me. He just found excuses to yell at us, criticize us. And my mom put up with it, because she believes in showing the other cheek.

But, as i said, now he's showing changes. He's not that beast anymore.

While it is still very frustrating to be around him, I feel sad but not angry right now. Along the years he has stopped most of the abuse that I've experienced from him all my life. The criticism is almost completely gone. I used to hear bad stuff several times a day, almost everything he said was against me. Now I will hear something critical from him a few times a year. In these last 10 days he even made efforts to listen to me - or rather... I basically forced him, because I wouldn't listen to his usual monologues about politics. He's changing. He's either weaker, or kinder, or both. He's no longer the beast I used to know. This change has happened in the last 2 years. Before that, he was the same asshole he's been for decades. Maybe now he's lost the convictions to fight us. Maybe he realized that it doesn't make sense to hurt your own family. Of course if that is the case, I will pretty soon stop fighting him as well.

Then if you add, to all these reflections, the fact that they are getting older and that they could die, I get even more sad. What a waste of lives and what a waste of generations of lives.

My father seems to have grown up believing he had to change and improve the world. He did a lot of good stuff for others. But how coherent is all this if you turn into hell the lives of your whole family and your own?

I've been around a lot of these people like my dad, who, out of virtue, make your life hell. Out of helping you to be virtuous, or rather, using that as an excuse, they treat you really badly your whole life. This is totally bull****. He's a sadistic mother ****er. Maybe now he's changing, but he's been a sick sadistic mother ****er his whole life. Let's not forget this. He's made my life hell.

What sense does it make to act like the objective of your life is to save the world and then treat your family badly?

He's fooled the world, and even my mom, and now everyone worships him except me. He's chosen my mom because she was a moron, so that was easy. He didn't get to choose me. I didn't turn out to be a moron, like he tried to make me believe I was. And I am calling his bluff. He's not a saint, nor anything close to that. He's a sick sadistic mother ****er, who's been successful. Being successful doesn't make him any healthier. Actually he worked hard to be successful so he wouldn't have to change, because successful people get to shape others and stay how they are. It's the others who have to change for them.

...Let go. It's so easy to let go. Relax.


Drifting and floating... drifting and floating...

Back and forth... back and forth...

This has to be the best hypnosis video I have ever seen. It's so good that it almost sounds like a song. She's a real artist, or whoever mixed the sound with her voice. "That's right, your mind is floating, like that little boat...".

The way she says "that's right" and other things made me think that she's reading a karaoke-like script off her screen. If she is, then she's not really an artist, but she is still very good at reading it correctly and then this whole thing is very well organized and it is still very effective in making me go to sleep.
 
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time goes by... but I make progress.

It's a race against time. Time goes by but I am trying to get something done faster than it goes by. That is why I can't afford any interference from vito and other idiots. Idiots are off-limits in my life. Being a jerk is out of the picture altogether. There's no time to waste. Yes, I spend time writing here, but it's my need for talking, which gets relieved here, much faster than calling up people, meeting them and talking to them. I write here, whenever I need some social interaction.

Little does it matter if no one replies. Actually better, because I don't have to waste time replying back and forth. The ideal listener. And I know someone listens (reads). As long as I have this feeling that someone listens, even if I were wrong, this journal does its job.

Now I need to show off my work, to myself and to the world. This weekend I am finishing up my 5 new systems, bringing my total of automated (and back-tested) systems to a staggering 71. This is hard, heavy work, this is the outcome of being persistent, fixated, obsessive for many years.

Here's just one control panel page on my excel workbook, reduced to 10% of the full size appearance:

Snap1.jpg

Every one of those little boxes is one system.

Yes, sure: I must also add that out of my 71 systems, only 20 are good enough to be traded. Or maybe a bit more, about one third. That's how hard this task has been for me.

Had I not met the investors on this journal, I would not have taken this path now and I would be much more behind. They have sped up the process, and doubled the quality of my back-testing and selection of the good systems. Let alone the enormous potential in terms of investment capital available. Let alone the psychological support of not being alone with my compulsiveness (I am now even able to trade my own account without tampering with the systems, thanks to the "golden share" they have).

I owe this great improvement to them and therefore to this journal, because I met them here. And therefore I also owe it to myself and to my passion for writing. And I owe it to trade2win for not banning me during the countless arguments with users and even with some (trolling) moderators. Also I owe quite a bit to other members who have made suggestions on this journal. Let's not forget the method for automating the calculation of maximum drawdown suggested by Weighbridge and developed together with him over a year ago, which is the first time I probably benefited from writing the journal in terms of trading ideas and not just psychological relief:
http://www.trade2win.com/boards/trading-journals/72598-my-journal-44.html#post953574

So, thanks to all. I am acknowledging the great improvements made thanks to this journal and all those interacting with it. So first of all, thanks to trade2win for letting me post here and for having created such a great forum, which such perfect settings and options. There's no other forum as neat on the web, technically speaking.

I like to do things well, and I think it should be acknoweledged when others do the same, so they keep doing it. It's called feedback.

When I came here and started my journal, 16 months ago, I had about 30 systems of those that I am still trading and forward-testing today. Now I have 71. Of those maybe only 5 were good. In the process I've quadrupled my good systems.

I have completely stopped my gambling, which is why I started writing here. Not to say that I will stop writing now.

How long have I stopped gambling for? Let's see...

My last discretionary trade was... on October 14th:
http://www.trade2win.com/boards/trading-journals/85510-my-journal-2-a-160.html#post1286350

It's been almost 3 months.

I am still totally at risk of resuming my compulsive gambling tendencies. But now I have implemented a method that keeps me safe (what i called the "golden share method"). I can't gamble the investors' account because of course I am not that compulsive. And now I don't gamble my account, because they have a golden share in my account. It works.
 
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Yeah, my sadness is still all there. I am watching tv all by myself.

I don't know if I am depressed because they'll die or because I'll die. Yeah, I am feeling some pain in my head. Maybe it's the usual tumor.

I always get depressed during these holidays.
 
Good. Sadness about my parents was replaced by concerns about Vito coming back to Rome. My hate for him will keep me busy for the coming month. Just as good as any other pastime.

Well, no, I would prefer another pastime.
 
71 systems

I am getting there. Another few minutes and I will be done with my last feat: building the last 5 systems and bringing the total to 71 systems. All on one excel workbook. I never thought I would get here.

I didn't get here exactly the way I expected to. The change is that I accepted that not all my systems work (a change brought about by my work and confrontation with the investors). It was a step forward once I accepted this fact: that not all the systems I am building will work.

However, using the out-of-sample method, the success rate is higher than before. In the first year of this excel workbook, 2005, I've automated two, and none have survived by how bad they were.

Well, let's start from even earlier.

In 2002 I was building systems on tradestation, but I didn't know how to automate them. Besides, the systems had too many parameters and weren't good.

The same happened in 2003 and 2004. A lot of systems, a lot of overoptimization, no automation.

In 2005 I started automating systems on excel, but I could not backtest them, because they were too complex. They were working on the market depth bid-ask differences (a valid concept but too hard to back-test).

The same applies to the systems I've been developing in 2006 and 2007, which were derived from those bid-ask systems of 2005.

All those years, six years, 2002-2007 wasted on the wrong path.

Then in 2008, I said to myself, why not build a few extra systems, to be traded along the bid-ask systems? The bid-ask systems were very boring, because they traded rarely.

It turned out that the bid-ask systems, never back-tested, did not work at all (at least in my version of them, because as I said, the concept is valid).

The bid-ask systems did not work and eventually I dropped them altogether, because they were clogging up my excel workbook.

But then, to my surprise, the systems that were supposed to be a side project, actually did work, and then I kept going in that new direction, just like a genetic optimizer, that goes where things work and drops the directions where things do not work.

That's right, I kept going in that new direction, building more and more... and now we get back to that summary I was making about the quality of the systems.

In 2008 I've built 15 of these, of which to this day only 5 (33%) have turned out to be very profitable and worth trading.

In 2009 I've built 25 systems, of which 9 have been successful (36%), which is a slightly better % rate of success.

In 2010 I've built 31 systems, all of them using the out-of-sample method, which should guarantee a success rate of at least 50%.

Right now it is still too early to tell how many are successful, because the forward-testing has seen too few trades. However, my guesstimate is that at least 50% of them will be good enough to be worth trading (which means very good systems).

Yes, all in all, right now I should have about 30 good systems out of 71 (but I still don't know which ones, I only know 20 that work, the others still have to be seen). The investors made me face the facts. They made me open my eyes and see what worked and what did not work.

For example, initially I thought I could get the CL_ID to work by reversing its signals. It was a bad idea but I kept developing it, despite the fact that it could not be back-tested but only forward-tested. What made me do this is the hope and the wishful thinking in me, whereby I wanted ALL my systems to work. Back then, I also maintained that my systems made 100% every month, and I would get offended if anyone disagreed with that.

Damn. Then I started trading with the investors, selected my best systems, and we went up and down for six months, closing the first six months with a profit of exactly zero.

This forced me to open my eyes. There can be no hindsight polluting your results, and all systems have to be traded as they are, without tampering, and without turning them on and off too frequently. By keeping me from tampering and interefering and from compulsive gambling, by slowing me down in the selection of systems, and by making me stick to my choices, the investors have forced me to face the facts and open my eyes. And the facts are evident: not all my systems are profitable. Only a minority of them is. Also, taking into account potential drawdown, that has to be covered at all times, my systems do not make 100% a month. What I can realistically hope from the best systems, if I can manage to select them, is to make a 30% a month, which still sounds like science fiction considering they made zero in the first six months, but that is largely due to the wrong selection of systems.

But let's face it, once again. Even if I had selected the right ones from the start, we would have made about 10k, on a capital of 15k. That is not a monthly 30% either, but just a meager... 10%. Yeah, I guess I could say that I am positive my systems can make a monthly 10%, given I am using the right money management. However, that is far from the 100% I spoke about just six months ago. It can be compounded though, so it goes up to over 300% a year. That still sounds great and that is realistic. We will see if I can make it happen.

According to my initial estimates, 100% a month, that, compounded, would have made me richer than bill gates in just a few years. And I thought it was realistic, just six months ago.

That's why I need the psychological support of the investors:

1) to make me face the facts and be realistic
2) to give me psychological support when my dreams of grandeur get shattered by the markets
3) to keep me from gambling when that happens (see above, #2)

There can be no improvement without first acknowledging our limits, and that often doesn't happen without being open to dialogue and to the exchange of ideas with other people.

Often other people are a waste of time and a nuisance, so I am right in avoiding them, but in this case I really found the right people to have a dialogue with and exchanging ideas.
 
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All done. Finished with my 71 systems.

My mood during this weekend was sad. But what matters is that I keep making progress on my systems. The excel workbook doesn't care about my mood when I worked on it, and it retains every little extra step I make, regardless of where it came from.

If instead I were trading discretionary:

1) my bad mood would affect my trading adversely
2) there could be no permanent improvements, because my mind cannot retain things like an excel workbook, univocally and permanently

The excel workbook I have today is the result of 5 and a half years of work on it. Work done during the widest range of personal situations. What is important is that every time I modified it, I improved it. It may deliver tomorrow some money because of some work I did on it 3 years ago.

With discretionary trading this is not possible. A moment of depression could cost you the whole account. The same applies to a moment of distraction, a moment of euphoria.

Instead the excel workbook (automated trading) will apply every good little bit of work you put into it, with the calm and self-control of a surgeon at his best, or, rather, of a machine.

The 71 systems will produce about 71 trades per week. Some trades several times per week, others trade twice a month. On average, I get as many trades per week as I have systems.

I like symmetrical things, organization, precision. I like having everything under control. I don't have the single trade under control, but the big numbers I do.

As Larry Hite said about system trading in Market Wizards: What makes this business so fabulous is that, while you may not know what will happen tomorrow, you can have a very good idea what will happen over the long run.

And here's more from Market Wizards (page 42, Richard Dennis):
How much of a role does luck play in trading?
In the long run, zero. Absolutely zero. I don't think anybody winds up making money in this business because they started out lucky.
But on individual trades, obviously, it makes a difference?
That is where the confusion lies. On any individual trade it is almost all luck. It is just a matter of statistics. If you take something that has a 53 percent chance of working each time, over the long run there is a 100 percent chance of it working. If I review the results of two different traders, looking at anything less than one year doesn't make any sense. It might be a couple of years before you can determine if one is better than the other.

And finally, as the Godfather said:
http://www.subzin.com/quotes/The Godfather/39
02:28:42 I worked my whole life. I don't apologize for taking care of my family.
02:28:48 And I refused to be a fool,
02:28:52 dancing on a string held by all those big shots.
 
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The excel workbook I have today is the results of 5 and a half years of work on it. Work done during the widest ranges of states of mind. What is important is that every time I modified it, I was

Cliffhanger Travis ???

You can't leave us like that....
 
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