Missing the point
YOU are missing the point. as you have proved in this post, and most of your others: in this and in other threads.
*JDR* said:
You are not doing very well really considering what has happened in the markets since the start of this thread.
I randomly picked a few stocks and am seeing up to 14% return.
You seem to think that a positive balance on your account rather larger than this trader above signifies that he is not doing well, and you are doing better.
It means ABSOLUTELY NOTHING AT ALL.
DOODLY SQUAT
ZIP.
What matters in this business is consistent returns in varying market conditions over long periods, and so what happens over a period of a few weeks matters not (provided that the drawdown is acceptable. You will never make a succesful trader until you understand that, and you are clearly missing the point until you do.
Your "system" is still not even of the blocks since it has had only a few weeks of either trading . If you are still posting consistent profits in two years better than this trader, or can show a backtest that survives bull and bear conditions, then is the time to criticise him, or promote your scheme over his.
Your phrase
*JDR* said:
You quite often miss the point of what people are saying.
Is english your first language?
Is offensive, and not acceptable on any forum - particularly from a newcomer.
A few words of comment however:
Your system picks random stocks. Clearly therefore any statistician will tell you that you can on average do no better than the index if trading long only, except the variance of your holdings price must on average be greater than the index, because you cannot take advantage of the variance reduction that occurs on aggregation. So your drawdown will be greater. If you trade short and long randomly , then on the basis of a zero sum game, you will simply lose a continuous stream of trading charges, and will not even benefit from a long term trend.
Your system has a random entry condition.to select direction(stock>50ma) Do a long term backtest and you will prove that this has no statistical correlation to market direction whatsoever. ( as I and others have done - you it seems have yet to do this basic stuff)
Your system specifies an inviolate stop loss of 5% But it specifies no fromulated exit profit or time condition.(LOL) Therefore on average you will wait till you lose 5% on each trade,
You seem to think that it is only psychology that matters, that so long as you are a stubborn lad, and refuse to exit until you have lost the requisite amount to other traders on each trade, then somehow you can win. Clearly that is both philosophical and scientific nonsense.
The psychology only comes in when you have established the expected calculated drawdown of a REAL SYSTEM that does backtest properly, and then you must stay in within limits of that drawdown. However most REAL traders work within limits. If they lose their max for a week or a month they sit out of the market. If they see turmoil (such as post 9/11) or possible onset of war most will stay out of the market until they can confirm that their system is not jeapordised: or they are taking a specific speculation on the fundamental consequences of those events on markets. The market will be there tomorrow. The question is will you, or will you have blown your account by then?
That you have "made a profit at all" is only because the SP500 has had one of its longer bull runs in recent history , and randomly you happened to be long. Rolling a 6 on a dice does not make you a good trader- it just makes you lucky.
So I suggest you do not back this "scheme" LOL with real money - and do not promote it further until and if you have done a backtest.
On the other hand,
Looking at the patterns in the trading of this trader "looking for investor" I see signs that he does know what he is doing: and it really is not helpful to him or others reading this topic, to see posts that imply that just because "a monkey sticking a pin in" happened to roll a six on a dice makes his system anyway inferior, or yours even worthy of consideration.
