Increased or decreased risk with adding strategies and boredom etc.

Quote from ElectricSavant:
trading is boring

Especially monitoring automation...
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Automation allows time for research. Not having to watch the charts leaves 16 hrs/day (mixed in of course with time spent with the wife and kids, and eating and exercising, etc... what more could a geek want?) for research, development and stepwise refinement... over N weeks/months/years, that's a huge productivity advantage...
 
Quote from sheepsucker:

Hi!

This post is intended for those that have one or more strategies making enough trades and providing some profit.

After I got my first strategy live and making profits, it seems most weeks, I find it extremely hard to motivate myself to add strategies or improve the existing one, until I find some problems with it. Leading me to boredom.

I tried to code and add other strategies to have them as backup or decrease variance of returns. But instead of decreasing variance they seem to increase variance. Because the markets are so interconnected and when eg. there is sudden increased volatility all markets seem to behave bad. Like in 2008 all markets went wild, which means if you have many strategies it is very likely ALL of them will take a beating at the same time which will make the DD deeper. So risk is actually reduced by just having one active strategy.

How have you guys solved this. What do you do once you have a working strategy? Try to improve it, create backup-strategies(in case edge would die) or try to add strategies and find uncorrelated ones or something else?
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Intermarket analysis will help, also developing a filter to manage noise. I would refer you to the ACD thread for this.
 
Quote from bone:

I have some clients that take a dozen trades a month, and I have some clients who take a dozen trades a day - and the higher frequency does not necessarily equate to greater net P&L.

In terms of boredom, I would say that taking a trading on impulse due to being bored or needing action is usually not a good idea and is in fact a really bad habit that can be very destructive. Especially on a Friday afternoon.

Another really destructive behavior is forcing trades in order to make a certain amount of money. Seriously. Nothing good ever happens when you force a trade, or try to impose your will upon the market.
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Good advice here.
 
ok thanks, i now understand this about likelyhood DD exceeds historical as sample increases.
If you wait long enough, also the very unlikely will happen. On the positive side at the same time the law of averages start to apply.
But the DD for sure is dangerous, especially when sizing up. Also knowing it can exceed historical without disproving the system can make it more dangerous because you can let it go further than necessary. So lots of things to consider again and I guess understanding your system in and out is most imperative.

If you have many systems it gets harder to understand them and how they interact in extreme situations.

Lots of time to do research, but lazyness hits in so hard to motivate myself until a problem is spotted. Well I guess that's a personal problem.
 
btw. if someone wants to exchange ideas privately i am interested if it could be mutually beneficial. Im mostly focusing on mean reversion strategies.
 
Quote from sheepsucker:

Im mostly focusing on mean reversion strategies.
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I cannot think of a worse strategy to employ the past few years. Why make things so hard on yourself... enjoy pain ?
 
Quote from bone:

I cannot think of a worse strategy to employ the past few years. Why make things so hard on yourself... enjoy pain ?
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Not everyone is trading the same instruments as you.
This thread is obviously not for a vendor like you who is relying on selling services instead of making profits from trading.

I will ignore you from now on.
 
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