Quote from Trader666:
Time exits are a legitimate way to test entries. You can pretend they're not but that will only make you look even more ignorant about backtesting. With your "model," I was testing going long at the 0 to 7 transitions and exiting 5 days later (which worked better than 1,2,3, or 4 days).
A beginning person, such as you see here, could lay out a plan to test an idea. This person could not figure out how a cycle works and then test the cycle.
Obviously all points in a cycle (0 through 7 are going to appear. It is difficult to count backwards initialy but that can be learned. A person can look at converting three binary digits to decimal and figure out the two halves of the cycle. 0 to 7 is the beginning of a long and 4 to 3 is the beginning of the short half.
From the beginning to the end of a long takes time to occur. Most PVT traders just do this as a way of trading. Buy after DU ends on the day of FRV and enter before the price begins to rise. The same is true for a short trade. When the .25 of a short occurs in the early am, then within an hour you can expect the price to begin to move short.
We tested 400,000 occurances to get the characterisitics of the PVT trading described. This includes checking out the entry and ecit for each occurance. It reduced to a one pager which you tested and did not post the results as yet.
This guy was incapable of doing this. Why? He apparently cannot do the work to figure out the realtionjship of an exit after an entry.
I admit it means a person has to pair entries and exits. The person also has to deal with time passing.
A cycle in a flat channel will be easy to test. So will a cycle in a sloping chanel either way the slope is occurring, but only up to a certain slope.
If the slope is steep the the cycle will take a longer time to occur. Taping steep channels are a good example of the longest period of time. As we will see, this person works in his ways and they are not in the class of rational or critical thinking. This was axplained to him years ago and by several people. Nothing has changed for him as a result of this input.
Secondly we gave him explicit instructions for suring his testing problems. From this effort we made, he ceased testing. Or at least, he ceased posting the results.
Our results are different from his and that is why you see the rules and the assorted values for trading PVT from a single sheet.
Stocks in steep channels stay in those channels a longer time and make a lot of money.
We showed another good charatristic that came from the ranking portion of the PVT. Ranking is used to set up the Universe for testing and for trading. Rank is simply the percent per day a stock makes as it is traded. %.4 would mean the stock moves 5.4 percent a day. Nutrisystems was over 10 at one time. It was a three day trade that netted 30% in each of four three day periods.....
Looking at this level of performance, a person sees that 289% compounded is the result of those 12 days during a year as nutrisystem's contribution to the year. Other stocks use the capital when nutrisystems is not using it.
This introduces how to trade capital. In the test that was done, there was a failure to use the capital in a rational way as judeged by any standard. If a potential trader cannot create a plan for using capital in a test, then the test is meaningless for that reson alone.
The test tried to prove something. What it proved was that it was a test that proved nothing. Doing 23,000 occurances and having no finanial result is a test that has no financial result. A pparently some intial capital was used and after 23,000 occurances an average loss of 18 dollars per occurance occurred. We found out belatedly that some occurances in vlolved 10,000 shares. We didd not find out the smallest mumber but we feel 100 shares may have been the smallest.
The stocks, we found out, were 1000 stocks taken from the S&P 500 only. This is a difficult task for the period chosen or for any period chosen.
There is no way in trading PVT a S&P 500 stock can make the list. Commonly they have ranks too low to ever be a choice for trading. A exception could occur if the company was spun off or something.
I've told you several times before why I used time exits instead of the 4 to 3 transitions called for in "Tomorrow's Paper Today." And that reason is, your "model" is so BROKEN that the transitions from 4 to 3 are VASTLY outnumbered by the 0 to 7 transitions... enough to make the average trade last for YEARS.
The time exits were too soon when the average of 400,000 occurances are tested to yield an average of 8.1 days.
If a person does not teat cycle in a cycle test he will not get any results. By avoiding testing the cycle, the results could be anything. What was the problem in the testing. Apparently the test did not keep track of individual trades properly. It only kept track of dates and not prices of stocks. Each of the 23,000 occurances had a data set that looked like Entry time and price. add five days and record the exit price. The amount of shares was determined somehow and recorded BUT how or why is still unknown. All tests use trading strategies, this forum is the place where strategies are discussed. Usually if a test has an initial capital (this one did), then there is a strategy. It is possible the strategy wrecked the test by itself alone. It was NOT a PVT strategy that much is known.
But you know that already and are just trying to confuse people with red herrings.
We recommend using all the tools of Pool Extraction Paradigm and applying them to the respective PVT, SCT and SSR markets. The consequence is that on any level (take the forest level for example) anyone can use the methods to make a comfortable living.
You are an example of a person who does not understand wht you did and how it turned out to have no staticitical significance. People could empathize with you I suppose. On the other hand, for years, you could have corected your results to determine the facts of the matter. Maybe you would not have to go as far as we did, but it is possible to be thorough.
Now you are reduced to posting pics you make and change the colors of. you post quotes of people who have their person agendas and do not state the context.
People do get confused when they do not think critically and when their processes are disrupted temportarily or permanently. Now it has been proven by rational testing that such disruption cuases stress and under such conditions stress precipitates using rules in such a way that their usage gives the opposite result desired. Read an overview on page 78 of the Economist of 11APR09.
If your "methods" are so profitable, what happened to your promise to your former IBD group to turn $10 thousand into $1 million in 100 days and post updates on ET?
Fulfilling that promise has been wonderful for me. My health issues did not prevent me from continuing forward along several lines. Increasing capital two orders of magnitude takes time, but not much time. The IBD group was split into two groups in terms of capital. several had the 10,000 you keep mentioning others had an order of magnitude more. All wer interested in changing their capital by an order of magnitude and repeating the process.
For those who do not know the members, then came from many parts of the US and some foriegn places. Now, those associated with the methods meet periodically and come from all over the world. Part of the pool extration Paradigm involves a set of logic for building wealth just based on accrued profits. A person on any skill level does this.
A simple example will help those to understand what we suggested (and which you think is still an unfulfilled promise).
The person with 10,000 dollars has an account, he has a margin level and he is using a platform we spent over a year shaping up and who's parent company will be our sponsoer in VEGAS as a courtesy. On Day One he trades 10,000 dollars in the form of 20 contracts on a forest level of 4 to 7 trades a day. He adds contracts at the rate of 1 per 500 dollars profit, that is 1 contract for every 1/2 point he makes trading the 20 contracts. For example, on the chart we posted from Scott's Cash Cow (06MAY09 showing 17.25points net at beginner level), this person made an addition of 30 contracts to his 20 original contracts.
We would level him at 50 contracts to aclimate for a while and then do partial fills of 2 - 50 contract partials in the usual reversal manner. The general picture for you to imagine somehow in your mind or on a sheet of paper is that when a person starts with 10,000 dollars and then makes 34,000 dollars a day regularly, then he gets to be able to do 5 or 10 partial fills of 50 contracts each turn soon after.
For adding another 100,000 after he is at 100,000, it only takes a periodic resting place at given trading levels a few times.
Making one's self settle at 50,000 net a day as a routine gets to be a casual process.
All in all, 100 days to accomplish any goal is a long time in Pool Extraction Paradigm trading. The capital is spread among methods with simple limits of block size, upper limits of capital per stream and the money velocity is well known and offered all the time by the market.
Let's see you obfuscate your way out of that by blaming someone else...
Check your archives, everything was already posted long ago.
