One thing I'll say about McD is... poor people need to eat.. one of the more depression/reccession resilient stocks.. the more poor people, the better walmart and mcd does, i've been unwinding from them and moving back into energy for awhile and will so until the next bust starts to wind up to drive up unemployment
hard to know about the value of a share vs the business in commodities it's pretty simple if you need to feed cattle you're only goning to pay so much for a bushel of corn
One part of the HBO series "Floored", I thought was quite interesting - a degenerate trader was interviewed about his success. He lived in a big-ass house and was drunk for the interview. The guy said, when you know you're right, bet big. Iow, break your money management rules (~2% rpt, or whatever), and load the boat. It makes sense. The money management aspect of trading is shared with gamblers, but that's it. In my vocabulary, gamblers have no edge. Card counters do, as should traders. There's definitely some logic to it. Say risking 10 or 20% of a stake if there's an 80% chance of being right? 5 million in the bank, is 5 million in the bank, regardless how you earned it.
Seriously, if it ain't broke, don't fix it. Human intuition is part of trading. Not all trading has to be rules, charts, and statistics. When you feel something in your gut, and it is backed by some knowledge or experience...then you should go with it. If you want to call it gambling, okay fine. But markets change, and either you see it happening with your eyes, or you wait until it hits your bottomline...you will need to change too or go bye bye. Look at the market. Why was it favorable for your strategy? And what type of market will make your strategy unfavorable? If you can identify these 2 markets...then you will know what to look for. And for the record, it doesn't have to come from a chart, it can come from news and macroeconomic activities. What news will make the market change? Like if you know what farmers can withstand in terms of corn prices, then you already have an edge. And if corns goes beyond what the market can sustain...then you should go big and forget all the money management rules. At least, that's my opinion. Trading is about exploiting opportunities. And these opportunities only come rarely. Another example, the Canadian debt to income ratio is at an all time high, and the Canadian housing is in a giant bubble. How does that affect your trading on the CAD? I don't care what the chart says when the underlying news is going to move the currency. Once that is laid out, then you look at the chart to find zones to trade and manage your money to withstand the losses if you are wrong.
yeah, that's really the one that botherd me GBP/CAD on the six month daily not much opportunity for trading you were either right or wrong
it aint that funny. I have a trend system that constantly adds to winners (never had the guts to trade it with real money.) It's amazing the kind of money you can make if you get on the right side of a trend.
That's how Livermoore traded. That bet sizing technique is a real edge. He would "test" the market with one position, and as it went in his favor, continue to scale in. That way, when you're wrong, you're wrong for a penny. Right, right for a pound. That style requires a decent trending market, tho. But ya, it's worth it. I think the real key is just being able to 1) identify a trend and 2) enter on pullbacks. Pyramiding can and does work. Think about all these hedge funds. They HAVE to pyramid. The liquidity doesn't exist for them to enter full position on the bid or offer. They have to scale in and out. Catch the big waves and and pyramid up and down.
That's right. If you get in on a trend, you can stack it and hit it huge. That's where the big money is. But to get into that trend, you will probably need to keep testing and take small losses because you are constantly setting the SL beyond the recent high/lows. And these long trends turn only once in a few years. Pyramiding into winning trades is like the reverse newbie trades.
Ya, you need trendy instruments. And a BIG trend. But it can work. Ideally, something like a daily time frame to identify the main trend, then build positions up or down, intraday.
Austinp trades by using multiple entries. It just seems to me that multiple entries is something you learn and master, that according to what I have heard, really boosts the p&l stats. Im working on it