My simple, yet profitable trading strategy

Discussion in 'Trading' started by traderich, Jan 26, 2007.

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  1. telozo

    telozo

    In my opinion it would make more sense to allocate your buying power equally between your 6 stocks, and then use a portfolio profit target/stop loss as a percentage of your buying power.

    If you post your picks for the last week, I can backtest this idea.
     
    #41     Jan 26, 2007
  2. nkhoi

    nkhoi

    for extra boost when the short get pinched
     
    #42     Jan 26, 2007
  3. billp

    billp

    Makosgu,

    Thanks for the below. Some queries.

    So at exactly what time will you start entering the position?

    Do you know of any trading platform that can eliminate the gaps to calculate this information?

    TIA




     
    #43     Jan 26, 2007
  4. billp

    billp

    How long have you noticed that? Seems that both Traderich and yourself have this view. I am wondering why the loss should be relatively smaller than the gain. Could it be because for losers, the gaps are usually larger than the gainers, thus price movement for losers on that day tend to be relatively smaller than the gainers ? Any ideas? Just thinking aloud.


     
    #44     Jan 26, 2007
  5. To Telozo:

    The guy who posted about shorting the % gainers: He mentions he does it, but when and how. Is he shorting the top 6 at 10am and then covering at 10:30? or leaving till end of day or midday or what?

    Often times my list of 6 are down at 10:30 or 11am for a few hundred bucks, sometimes more. However, what typically happens on the great days like today, the couple big winners just go crazy and carry the weight of the couple duds.

    He isn;t very clear about his method. I am very specific about what I do and how I do it.

    Also: I did say that I close out at 3000 for the good days. This is relatively new. If you look at my spreadsheet(s), the data shows holding until 3:55.

    Closing out at 3000 gain or 1800 loss is something I have recently done to try and 'tweak' the method.


    Regarding shorting the losers: This may work as well. I haven't researched it enough to know but it may work just as well.

    For all I know, there may be a brilliant mind on ET who will say that the key to my success is simply letting the winners ride and cutting my losses at the right time. It could be that if I randomly took 6 stocks off the % gainers list at 10am I would do just as well as the TOP 6. I am looking into this as well. I am constantly trying to make this method even better. Any thoughts are welcome.
     
    #45     Jan 26, 2007
  6. I'm handsome but not brilliant but with that said, I wish you all the luck in the world. One of the main keys to success is Hard Work. So keep working hard at this plan you have and you might just make a very good living. I hope you do. People who will just follow a plan without working it will not be successful but you sound to me like you put a lot of effort, hours and WORK into it so:
    Good Luck!
     
    #46     Jan 26, 2007
  7. Interesting. Shorting the top gainers is profitable according to the thread referenced above, and going long the top gainers is profitable, too, according to this thread. Does this mean I can double my profit by doing both? The simplicity of this strategy can't be beaten: I simply short and long the same quantity of the same stock at the same time. Factor in the risk (which is zero, because I have a perfect hedge), and my Sharpe's ratio is through the roof.
     
    #47     Jan 26, 2007
  8. I'm glad someone else pointed this out>
    If you got out at $3,000 on Friday you should have had a loss for the week no?
    Of course that was the first thing I thought> and when I stopped reading about the great new investing plan of scalping rides on hot stocks.

    Geez trying to get ahead of big orders is what many of these hedge funds are doing on a daily basis. As a small investor if you really want to sit in front of a computer every day, seven days a week and buy that number of stocks every day? It's daunting. Remember we are all animals. It's bad enough we are shut away in an island wrapped in steel, that our feet hit concrete not soil. As an animal do you want the freedom to get out and get some some stuff accomplished? To take a few days off and let your winners run? Or be worried every day that you're going to have to sell everything at a loss? I like to make something no matter how little EVERY day-- now that adds up --

    *Since economic news often comes out at 10:00 I wonder market direction wise if results are better or worse if you buy at 10:30?
     
    #48     Jan 26, 2007
  9. Based on the PM's and the posts here, I have some new things to help improve this even more. Thanks !

    I realized that posting this was a risk, but the feedback overall was not too bad.

    One comment about "all this $%^*" for 225/day:


    The 225/day is based on 1000 shares traded. If you have more money, buy 2000 shares or 5000 shares at a time. Make 5000 a day, but it will take more capital. You will be limited to how much of some of these stocks you could reasonably get without significantly moving the price obviously.

    I am curious how many of you will trade this next week.

    Of course I will be thinking that someone is jumping in front of me as I try to buy these stocks on Monday at 10am sharp!

    I might have to jump to shorting the top losers of the day! lol.
     
    #49     Jan 26, 2007
  10. orion895

    orion895

    Simplicity of the strategy would probably make it difficult for many ET guys to take it seriously. As for money management, you disregard stock's volatility (you would buy 1000 stocks of GE and CME regardless). I would adjust your portfolio size based on market action, make stocks equally weighted and cut your losers fast......
     
    #50     Jan 26, 2007
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