The title of this thread is the only way I've ever traded. I begin to average into a particular futures market whenever it got to lows unseen for many years. Eventually price always came back and I would make a profit. I never looked at drawdown as a loss. To me, it was an opportunity to get in at a better price. Since I never picked tops, all I had to do was have enough capital to continue trading in this matter. If Cotton's at 30, that means I need $15k per contract 'worst case scenario based on cotton going to '0'. The challenge comes in waiting for these opportunities to present themselves and then seemingly waiting out the eventual turnaround. I only get a few opportunities a year and profits take anywhere from 3 months to 3 years. I have 100% belief trading this way, but I've yet to find another of style of trading that gives me as much confidence and eliminates the waiting time for profits to accrue. For the past year and a half, I've studied all trading methods/styles out there. Chaos theory and market profile are about the only things I haven't dove deep into. It is not my belief to become something I'm not or reinvent the wheel. However, I also don't believe that this style of trading is the only way I can be good at. I'd be very grateful to anyone who could give me direction based on their own experience trading in this matter and what other style or method they also found success in.
This is how Warren Buffett buys stocks, wait till a huge margin of safety exists and bet huge. What trades have you made lately? Do you use a similar philosophy on the short side?
was not there a book on this style of trading ( i.e. scaling down perhaps in the basic items we all need ? )