Hedge funds are like elephants in a pond. They cannot move hundreds of millions of dollars getting into and out of positions like retail traders do. It takes them months to get their entire positions. That is why they have to be satisfied with 18-20% per year. Jesse Livermore was trading then, with a couple million, Nicolas Darvas was trading with thousands then, tens of thousands which he grew to over $2,000,000, Richard Dennis employed like 13 turtles who traded his monies, the better traders got $1,000,000 a piece still, he earned like over $400 million thru the efforts of his turtles. At some point, you reach a wall where huge amounts of cash become a huge problem getting the same results. You cannot move huge amounts of cash trading and affecting the share price you pay to enter and exit your trade. Retail traders do not have that problem. I use only trend following in trading both stocks and options.
Every professional trader said market had changed dramatically over the years
- Thread starter TripleJs
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Hedge funds are like elephants in a pond. They cannot move hundreds of millions of dollars getting into and out of positions like retail traders do. It takes them months to get their entire positions. That is why they have to be satisfied with 18-20% per year. Jesse Livermore was trading then, with a couple million, Nicolas Darvas was trading with thousands then, tens of thousands which he grew to over $2,000,000, Richard Dennis employed like 13 turtles who traded his monies, the better traders got $1,000,000 a piece still, he earned like over $400 million thru the efforts of his turtles. At some point, you reach a wall where huge amounts of cash become a huge problem getting the same results. You cannot move huge amounts of cash trading and affecting the share price you pay to enter and exit your trade. Retail traders do not have that problem. I use only trend following in trading both stocks and options.
hahahahaha.
Again, you totally missed my point. Show me anyone (hedge fund or retail trader) who has beaten buy-and-hold with pure trend-following for the last 30 years. I agree it was possible many decades ago before it was so easy to identify trends mechanically and build strategies around the idea. So please, no more long, rambling paragraphs about Livermore in the 20s/30s or Darvis in the 50s. That's not the point! Read the title of this thread.
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Says a typical ET'er who makes a million before 10:00AM EST every day. Anyone who actually trades knows the title is very real.
It is “real” in that change has been a self evident reality since the beginning of regulated markets. In other words, he’s stating the obvious.
I'd call it assumed trend-following. If you held U.S. stocks from the 1929 crash through the next decade--or Japanese stocks since the Nikkei topped in 1989--you're actually making a counter-trend trade.
I agree and that's why you need risk control. If you buy and hold you could run out of time somewhere down the road.