Do markets change? Trend Following.

Heh... no one seems to comment on AFG's equity curve so I'll add...

1. The fact that the equity is log-normal, it doesn't provide the true picture of the actual model due to the compounding and it's vulnerable to a variation of a "selection bias" caused by equity curve compression. (Take a look at any index on a log chart and it looks like a very smooth upwards curve until the early 2000s...)

2. Because it is... log normal, there is definitely, at the least, a position sizing scheme included. So we're not sure whether the curve is generated by the risk management implemented or the signal. If AFJ Garner wants to prove a point from a pure "trading system" perspective, he needs to re-generate a risk-adjusted curve.

I have to emphasize that... risk management is a key component common to any kind of trading whether it be trend-following, mean reversion... discretionary... automated... etc. etc. etc.... I mean all trading requires risk management. Though, there is a danger that the RM scheme can be fitted to the curve (just like using MAE/MFE).

What I mean is... I can have a set of bad signals (random entry) and still make the equity curve positive by manipulating the "historical" equity curve. ("Historically possible"... in live trading, it doesn't work that way... Why? *drum roll* Markets Change)

Anyways... I have every reason to be skeptical about the equity curve and I wouldn't look at the continuous line and conclude anything at this point.

--------------------------------------------

AFJ Garner, no offense intended. Your post does serve the point, but everyone else is being a bit too optimistic and conclusive so I had to pull them back and provide them with a sense of perspective...

 

Here some facts

 

here is mine

 

Is Spydertrader AKA the infamous Todd Billis the same person as Jack Hershey?

Is says Spydertrader on Jack Hershey chart?? !!!!

 

Garner has a track record of carrying on with known shills/aliases in this forum. Don't forget his buddy Priapus Maximus. And before he was Garner he was ananda.

 

i would comment that i don't believe there is a more misunderstood stat than W%. it can be inversely correlated to profit. in nearly every bit of my research the quickest way to make more money is to lower your W%. any method can increase W% by increasing the width of the initial exit and by increasing the rate at which the stop follows a profitable trade or by decreasing the width of a profit objective. increasing the size of losing positions is another way to increase the W%. in fact one could make a method that had an 80-90% W% very easily.

the one suggestion that i would make to any new trader is to take whatever they are doing and try to decrease the number of winners in favor of the size of those winners.

 

This is a library issue you raised.

All platform librairies TN, Fidelity, etc, have spyder signature for ease of connecting them to the various forums.

Elsewhere some coding issues came up. On my chart you can read the plunked signals if you can read a chart. They are plunked on the chart but the plunk requester is not at the level of being able to read signals unless they specifically say in plain English: BUY or SELL.

A couple of weeks back I posted all the trades for a day one day ahead of those trades. If you look at Mr Black's prints you can see how the segment profits pile up and note that he is in the market most of the time on the right side.

the pattern given to Covel s a gift is annotated for reference right as the day began. Note also the open housekeeping the but a person in the market on the right side, right as the bar 1 opens.

What makes this gibberish and steak starved for Covel is that he follows trends and Mr Black and I do trend analysis which, deductively and NOT inductively always keep us in the market and on the right side of the market.

I did think the OP would have rejected my comments as he has thus far; there is an issue in trading that must be dealt with by most people. I am raising that issue. If you look at the equity curve behind our illustrations that is represented here, based on deduction, it relates strongly to a "standard" called the "market's offer". These advanced beginner signals posted as plunks secure 2X the ATR this am. I don't trade on an advanced beginner level, however; my trades are 3x more frequent than the illustrated trade signals on volume. (Look for P's). I trade the legs of the pattern gifted to Covel....lol... (R2R 2B 2R and B2B 2R 2B)

Amateurs do not view the markets as do employed professionals or the writers who write about professionals who are employed. We take the market's offer as a standard and that is not a consideration of the financial industry which does not include timing markets in its performance considerations.

Mt past handles have been Grob109 (the glider I flew), bubba7 (a kitty cat). I get banned occasionally by complaints of detractors and for using the word "fuck". Fuck is considered a no-no on ET by moderators who keep the threads "clean". As it turns out I was given back my original handle with the proviso that I just contribute positively. Sometimes you will also see humorus thread posts in response to detractors posts.

Spyder is the main man and workhorse of our paradigm and its applications. He is the one who convenes the global meetings several times a year. I am the one who can't get medical permission to show up. Currently I am having my parts replaced so I am becoming more and more bionic. I still use my original wooden keyboard however. My dragon 9 is on active duty all the time.

Our views are rejected by 4 out of 5 people according to simplisitc polling.

Hope this helps.

 

I fear I can not comment in any further detail on the equity curve I actually posted since I have used it for an article called "Tuning up The Turtle" to be published in Active Traders Magazine in their February 2010 issue. Full details of the actual system which generated it plus all the assumptions used are disclosed in the article.

Leaving that particular curve and that particular system aside, I will post another curve shortly with full disclosure of the system and the parameters and people can make their own minds up. There is no magic to generating these curves and these systems – just thousands of hours work programming, observing and thinking about markets. Get a good back testing programme which can simulate portfolio trading and position sizing algorithms and you are away. Couple that with reading through a few good books like Curtis Faith’s WOTT.

Mercifully, I have nothing to promote – I make my living from my own trading and have done so for many years. I wrote the book for my own satisfaction and the benefit I gained was the experience of writing some (to me) very difficult coding to produce the tests contained in the book. I had many Seykota “Aha” moments which have greatly benefitted my thinking and my trading. I would be lucky to make the price of a Mc Donald’s “Happy Meal” from the book. I was asked to write the book by the publishers Harriman House, following an article I had contributed to the UK magazine “The Spectator” whose business editor Martin Van der Weyer is an old acquaintance of mine from Hong Kong days.


WHAT I DO LIKE TO PROMOTE IS INTELLIGENT DISCUSSION

I have learnt much from intelligent posts by others on the old Chuck le Beau Forum and the Trading Blox Forum. And from the old Trading Recipes posts – no longer available. There are so many people on the Trading Blox Forum who have contributed to my thinking and my knowledge base: Sluggo, Mark Johnson, Garryboor, Ted Annemann, Roger Rines, ecritt, svquant and lots and lots of others including Curtis Faith (his posts are under “Forum Management”). I may have spelt some of these names wrong but you will soon discover them for yourself.

I TAKE WHAT I CAN FROM THE POSTS OF OTHERS, I TRY TO CONTRIBUTE A BIT MYSELF IN RETURN AND I PUT THE A***HOLES ON IGNORE.

 

Garner you are amazingly slippery character. In one breath you state that you have nothing to do with another author, but a quick 'search inside' on Amazon finds you thanked personally not in 1 book, but 3 by that same 'turtle' author. And in ET all you can say is that you have no "connection" and that you feel "sad". You are truly a dishonest weenie - whether you have systems trading insight or not.

And now all caps and cursing? Stability is not your middle name.

 

How should we describe your character? Mean? Offensive?

I read your 'Trendfollowing" with with pleasure. "Turtle Trader" less so. Especially the nonsense in chapters 11 and forth about "entrepreneurial skills". But Trendfollowing is a good book to get new traders enthousiastic about trendtrading.
I am a little put off though by your "contributions" in this thread in which you show an immeasurable littleness.