What do you think of this entry by Eckhardt?

Richbynature · Aug 31, 2006

I don't quite follow the logic of the 66% CAGR claimed above. Look at this link about Berkshire Hathaway:

http://66.249.93.104/search?q=cache...thaway+annual+growth&hl=en&gl=uk&ct=clnk&cd=1

Buffet has averaged 21.5% for 40 years. My simple question is how has your method beaten the world's most successful (?) trader in history hands down?

Grob109 · Aug 31, 2006

Quote from Hook N. Sinker:

This random walk stuff is nonsense.

OK lets see what happens if I begin trading General Electric stock 2 January 1962 and stop trading 18 July 2006. This mechanical system has these three rules:

1) Buy when price first increases above the highest price of the prior 400 sessions.

2) Sell when price first decreases below the lowest price of the prior 400 sessions.

3) Size positions so that the number of dollars to risk stop is 10 percent of account equity.

Number of trades 5
Total profit $ 2944958
Profit after subtracting $ 10.00 commission & slippage per transaction: $ 2944858
Risk is 10.00 per cent of equity.
Drawdown is 0.0211 (2.11 per cent).
Cumulative Annual Growth Rate (CAGR) is 66.28 per cent.
CAGR / Drawdown is 31.48
Instanteously Compounding Annual Growth Rate (ICAGR) is 7.69 per cent.
Annually Compounding Annual Growth Rate (ACAGR) is 7.99 per cent.
Information Ratio is 0.52
Initial capital is $ 100000
Long trades only.
Growth rates are calculated after subtracting commission & slippage.

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About 66 percent growth each year and the greatest drawdown is about 2 percent.
More...

your abacus is busted

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What do you think of this entry by Eckhardt?

Richbynature

Grob109