MarkBrown
Last Activity:
Feb 24, 2024 at 8:05 PM
Joined:
Dec 17, 2001
Posts:
3,408
Likes:
2,739
Gender:
Male
Home Page:
Location:
Texas
Occupation:
Technical Cognitive Research, Event-Driven Trading

MarkBrown

Male, from Texas

Holy grails exist they are not for sale they are earned. Oct 25, 2017

MarkBrown was last seen:
Feb 24, 2024 at 8:05 PM
    1. VSTscalper
      VSTscalper
      Mark,

      Just read your Reversion to the mean only trading - last post Today. I have "Scalping_My Way with ACV" - but haven't posted since Feb 2019. See page 25 - near the end - a long post. Saw your post in the Multicharts Forum - maybe I can help you.

      VSTscalper
      1. MarkBrown likes this.
    2. alexandredcruz
      alexandredcruz
      hi mr. Brown,
      I've seen this post from you"you can't trust multi-charts to auto trade trust me."
      I just bought Multicharts with this propose, could you give me some words on auto trade and MultiCharts?
      is there any other platform that you trust for algo trading?
    3. Mtrigga76
      Mtrigga76
      Hi Mark - Do you still have the Wyckoff indicators? If so, can you please DM me?
      1. Alix and dartmus like this.
    4. SPX Blaster
      SPX Blaster
      1. dartmus likes this.
    5. gkadir
      gkadir
      Dear Mark,

      You are an inspiration.

      I am going to learn the DOM to filter our better entries. I am really surprised how you manage to use it as I thought it was a lot of data to interpret.

      BTW, you look like a President of some country.

      Please keep in touch.

      Thank you

      Gulam
      1. dartmus likes this.
    6. Jarochocan
      Jarochocan
      Mark thanks for replying... WOW, seems to me that I am in front of a VERY HIGH knowable trader and my experience and model would be too simple for you.. as I said, I only trade Commodity Options and only do Selling, working on the Options Sellers model, but hopefully not greedy and VERY small.. However in 18 months my NLV has grown 78%.. love to learn more and try to keep it as simple as possible.. i Luis
      1. dartmus likes this.
    7. zenostiffler
      zenostiffler
      Mark
      What is your business model these days? I have looked at your website but am none the wiser. You could say exactly the same about my website so this is not a criticism.
      A
      1. dartmus likes this.
      2. MarkBrown
        MarkBrown
        Currently private trader.

        Retired professional bond futures trader with independently audited average per annum return of 21.74%.

        Trading 6,170 round turns per million per year.
        Jan 3, 2019
    8. trader99
      trader99
      Hi Mark, Did you short using futures or actually short on the exchange(s)?
      1. dartmus likes this.
      2. MarkBrown
        MarkBrown
        long the cash always as a investment but short and long on the futures. the futures has done very well being able to short makes holding the cash easy for me.
        Aug 16, 2018
    9. ElectricSavant
      ElectricSavant
      Thank You Mr. Brown. Since we are revealing secrets... So this is what I am practicing with- I have three or four T & S windows open graduated by volume filters. when the top lines are all red I buy and vice versa. ES Roulette?
      1. dartmus and MarkBrown like this.
    10. ElectricSavant
      ElectricSavant
      This is the question. May I know that event quoted below? Hey! I gotta ask!

      ES

      "there is an event that happens in between these block orders being filled that will not only tell you what direction the intended position is but it will also verify that it is a commercial block order"
      1. dartmus and MarkBrown like this.
      2. MarkBrown
        MarkBrown
        sure say you place a x1000 block order in a 30 tick range to be filled - you will get half of your order filled and then the price will trade very light volume a few ticks lower if your block order was a buy or a few ticks higher if your block order was a sell.
        Jul 25, 2018
      3. MarkBrown
        MarkBrown
        these few ticks are insiders who saw your order go in and they are buying lower and or selling higher to sell or buy back to you because they know they have a guaranteed buyer or seller which is you.
        Jul 25, 2018
      4. MarkBrown
        MarkBrown
        then i forgot to say the other half of your order will be filled.
        Jul 25, 2018
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  • About

    Gender:
    Male
    Home Page:
    http://markbrown.com
    Location:
    Texas
    Occupation:
    Technical Cognitive Research, Event-Driven Trading
    Currently private trader.

    Retired professional bond futures trader with independently audited average per annum return of 21.74%.

    Trading 6,170 round turns per million per year.

    As reviewed in "MAR" Managed Account Review publication.

    Mechanical Bond Traders: Pioneering Success in Liquid Markets

    In the world of finance, mechanical bond traders are carving out a niche for themselves in highly liquid markets. These traders rely on a system-driven approach, where trading decisions are made based on predefined algorithms and rules, rather than subjective judgment. This method is particularly well-suited to the government bond market, known for its high liquidity and volume.

    The Essence of Mechanical Trading

    Mechanical trading in the bond market hinges on the utilization of sophisticated algorithms. These systems analyze market data, recognize patterns, and execute trades based on specific criteria. The efficiency and speed of these systems are paramount, especially in a market where milliseconds can make a significant difference in trade outcomes.

    Navigating Liquid Markets

    The liquidity of government bond markets offers a fertile ground for mechanical traders. High liquidity implies a steady flow of buy and sell orders, allowing traders to execute large orders without significantly impacting the market price. This environment is ideal for the high-frequency trading models employed by mechanical traders.

    Building a Solid Reputation

    Establishing a reputation in this niche requires a blend of consistent performance, transparency, and technological advancement. Successful mechanical bond traders not only develop robust trading algorithms but also maintain a track record of resilience and adaptability in various market conditions. They must also ensure transparency in their operations, giving clients confidence in the integrity of their trading strategies.

    Facing Challenges Head-On

    Despite the advantages, mechanical bond trading in liquid markets is not without its challenges. The primary challenge is the continuous evolution of market dynamics, requiring constant adaptation and refinement of trading algorithms. Additionally, the competitive nature of these markets means that traders must continuously innovate to stay ahead.

    Some trading programs boast histories that extend well beyond their reported timelines. For instance, a notable financial group utilizes a program that has been operational for over a decade, though its formal reporting history spans less than two and a half years. The program’s creator, Mark Brown, attributes this extensive history to their deep understanding and confidence in the system.

    Formed in April 1998, this financial group focuses exclusively on Treasury bond futures and options contracts. Brown, who developed the trading program for Computer Investment Research Inc (CIR), plays a pivotal role in its success. CIR, which receives a portion of the incentive fees from this financial group, is managed by two principals, including Brown himself.

    In their synergistic partnership, Brown is responsible for developing systems and managing trades. The other areas of the business, such as investor relations, are handled by different team members.

    The proprietary trading system of the group combines a countertrend model with a trend-following model, with the former having a more significant influence on trade decisions, according to Brown. This program is designed to be highly adaptive, featuring switches that enable it to reverse positions to minimize losses and capitalize on market trends. For example, if a trade is negatively impacted by a shift in market direction, the program can pivot, buying into the trend to recoup losses before reverting to its original countertrend strategy.

    Despite some exceptions, the group maintains a consistent presence in the markets, either long or short. A notable instance of deviation was in late December 1999, when the group temporarily exited the market due to external concerns about the Y2K bug. Their return was marked by the successful implementation of both external precautions and internal system enhancements.

    Enhancing Trading Efficiency:

    “We adhere to mechanical trading,” Brown explains. The program conducts hourly market monitoring, with typical positions lasting between three to five days. Utilizing nonlinear equations, the model recalibrates its risk/reward assessments hourly, striving to optimize trading decisions.

    One of the main challenges in mechanical trading is managing slippage—the difference in price from when a trade is initiated to when it is executed. Brown emphasizes the goal of closely mirroring the model's signals with actual trade executions. The system also avoids overreacting to market fluctuations triggered by external events, such as Federal Reserve announcements, unless they align with the group’s rigorous statistical criteria for profitable trades.

    Brown is steadfast in his approach: "Our task is to execute trades as accurately as possible, following the program's signals. We recognize that outperforming the model isn’t sustainable in the long term. It's crucial to trust the system, even if a position momentarily seems counterintuitive."

    Although the systematic program used by the trading advisor has shown potential for success in various international bond markets, it currently focuses solely on the US bond market, particularly the 30-year bond. This choice is rooted in the market’s consistency, familiarity, and liquidity. However, expansion into international markets, like those in Japan, Germany, and Italy, is on the horizon, as these markets offer predictability and an opportunity for portfolio diversification.

    The advisor, Mark Brown, acknowledges two main challenges in venturing into international trading for the Dallas-based firm. First is the practical issue of time zone differences. Trading in markets like Japan or Italy would require activity during unconventional hours. The second, more significant challenge, revolves around client familiarity and comfort. Currently, clients are more acquainted with the 30-year US Treasury Bond, making it a strategic choice for building trust and demonstrating the program's consistency.

    Despite these challenges, Brown sees great potential in international markets. He aims to establish a track record of quick recovery from market downturns, ideally within 30 to 60 days. This approach was tested in early 1999 when the program faced significant declines but rebounded impressively in the following months.

    The trading program's compounded annualized rate of return stands at an impressive 21.7%, outperforming the median of the MAR financial sub index. However, it also exhibits higher volatility, with an annual standard deviation of 54% and a Sharpe ratio of 0.3.

    In terms of asset management, the firm saw a substantial increase in assets under management by the end of 1999, largely due to the acquisition of a significant individual client. Brown anticipates that as the firm builds its reputation, more clients of similar stature will onboard.

    The firm positions itself as an integral part of an investor's portfolio, particularly complementing the managed futures allocation. While the trading advisor’s disclosure document cautions investors that Brown may take positions that are opposite or ahead of client positions, this is largely a strategy for testing strategies with personal funds before applying them to client investments.

    In conclusion, mechanical bond traders in liquid markets are at the forefront of financial trading innovation. Their success hinges on their ability to harness technology, navigate the complexities of liquid markets, build a trustworthy reputation, and adapt swiftly to changing market conditions.