i meant pls email the book if you have it
Mean-reverting strategies are really much better than momentum strategies?
- Thread starter GloriaBrown
- Start date
You can email ernie chan and ask him through his blog.
The author clearly has a personal preference. However, his preferences may not be your preferences.
Are you favorite foods the same as his?
Are you attracted to the same women (or men) that he is?
Does the author see political issues similarly to you?
My point is that momentum and mean reversion are, broadly speaking, very different styles of trading. You personally will be more compatible with some methodologies over others.
Would you rather trade a system with 28% winners (72% losers) but your winning size is 3x your losing size?
OR
A system with 90% winners (10% losers) but your losing trades are 7.8x the size of you winning trades.
As you have probably calculated, both have approximately the same positive expectancy, but generate it in vastly different ways.
You can worry about whether or not an author is on to the Holy Grail of trading, or, you can simply gather the tools in these books and then use your own judgement to decide how to use them.
Are you favorite foods the same as his?
Are you attracted to the same women (or men) that he is?
Does the author see political issues similarly to you?
My point is that momentum and mean reversion are, broadly speaking, very different styles of trading. You personally will be more compatible with some methodologies over others.
Would you rather trade a system with 28% winners (72% losers) but your winning size is 3x your losing size?
OR
A system with 90% winners (10% losers) but your losing trades are 7.8x the size of you winning trades.
As you have probably calculated, both have approximately the same positive expectancy, but generate it in vastly different ways.
You can worry about whether or not an author is on to the Holy Grail of trading, or, you can simply gather the tools in these books and then use your own judgement to decide how to use them.
I've always found it difficult to quantify "Momentum" versus "Mean Reversion" strategies. The best strategy I've traded took mean reversion entries in anticipation of strong momentum to follow. So I was trying to trade both "Mean Reversion" and "Momentum".
How do you quantify between these methods?
How do you quantify between these methods?
It's all relative to time frame, right? You can be mean reversion on a time frame measure by n units
but
momentum or trend following on a time frame measured in n/4 units.
Some very successful trading strategies combine multiple time frames.
