Rol's Trading Journal

Just from skimming your thread I can tell you -- for the benefit of others -- much of your success is from refusing to use stops and not relying on having perfect timing within the range of said stop.

I'm surprised you haven't been attacked by the ignorant ET'er about your refusal to use stops. I suspect that's because you posted a chart of your profit curve. Stops will kill any and all otherwise profitable strategies. I have studied it extensively but if you try to tell this to someone who is struggling you get hounded. Congratulations on discovering the weakness of stops and trying to time the market. The most consistent traders/investors don't rely on either. Diversification is a far superior form of risk management than stops any day of the year!
 
I was thinking about a stock like EW which went from 90 to 70 without any reversal. Strangely enough the news was very positive, but I suppose it was a technical reaction then. This happens from time to time - it seems there are periods where it happens more often than not.

TS doesn't have a function for filtering events I guess. The problem is if a earning season is bad, negative surprises will be highly correlated. One could probably build a decent indicator out of positive vs negative surprises for the general stock market. In my analysis perhaps 20-30% signals get filtered out. PEAD research suggest there is a trend after announcements, although the studies look at 1-3 months periods.

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=3252704>
 

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Quote from Rol:

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Code: 
Real-time Account Net Worth	$74,840.58
Real-time Unrealized P/L	($7,049.49)
Current Market Exposure	172%
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you have 4X intraday leverage, correct? have you ever gone more than 2x intraday, removing excess before EOD? do you have plans to add emergency funds if there is a large adverse move on Monday?
 
Quote from the1:

Just from skimming your thread I can tell you -- for the benefit of others -- much of your success is from refusing to use stops and not relying on having perfect timing within the range of said stop.

I'm surprised you haven't been attacked by the ignorant ET'er about your refusal to use stops. I suspect that's because you posted a chart of your profit curve. Stops will kill any and all otherwise profitable strategies. I have studied it extensively but if you try to tell this to someone who is struggling you get hounded. Congratulations on discovering the weakness of stops and trying to time the market. The most consistent traders/investors don't rely on either. Diversification is a far superior form of risk management than stops any day of the year!
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Thanks the1,

That is exactly why I posted a profit curve at the outset, so I would not have to listen to people lecture me about stops. I've tried trailing stops to preserve profits, and saw that also eat up profits. That said, trading futures is so highly leveraged for most, I think stops are necessary in the futures market. Good luck with finding a consistent edge there, though.
 
Quote from macrotrader:

I was thinking about a stock like EW which went from 90 to 70 without any reversal. Strangely enough the news was very positive, but I suppose it was a technical reaction then. This happens from time to time - it seems there are periods where it happens more often than not.

TS doesn't have a function for filtering events I guess. The problem is if a earning season is bad, negative surprises will be highly correlated. One could probably build a decent indicator out of positive vs negative surprises for the general stock market. In my analysis perhaps 20-30% signals get filtered out. PEAD research suggest there is a trend after announcements, although the studies look at 1-3 months periods.

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=3252704>
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Fortunately, with EW, I screen out stocks over $75. I agree there are times that stocks become highly correlated during earnings. I have thought of just sitting out of the market around earnings seasons. Alternatively, I could look for companies that miss earnings and jump on a downtrend.

I rely on the fact of stocks like EW being the exception and not the rule, and to use small position size relative to account size, to squeeze a profit out of the markets.
 
Quote from shortie:

you have 4X intraday leverage, correct? have you ever gone more than 2x intraday, removing excess before EOD? do you have plans to add emergency funds if there is a large adverse move on Monday?
More...

Friday, I did exceed overnight BP by a few thousand, but saw that there were enough positions that would exit at the close to bring it back under 2X. I have enough cushion right now so I should not have to add more funds. To be puking up my shares, even if Monday gaps down, would probably be considered a "rookie" move when looking back.
 
Quote from NikEy:

Hey Rol,

how is your day? as bad as mine? It's always nicer to suffer together ;)
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Hi NikEy, I know you are saying suffering together in jest, but I try to avoid too much emotional attachment to my trades, otherwise it may cause me to short circuit my trading plan. I am currently down 9k, but since I followed my plan and didn't place a bunch of emotionally driven crazy trades, my present situation simply "is what it is." While I place an unusually large number of trades compared to the average investor (2000 since taking my strategy live 9-16-2010, I still view my account as one might view a buy and hold mutual fund investment. I just believe I can do better with my small amount of equity, compared with the gargantuan assets of a mutual fund.

A person with a long enough investment horizon should actually rejoice when the markets tank. I wish the DOW would go to one, and then when I have a substantial stake, make up for all the lost time. You take on a different mindset when you can tell the markets, go ahead and move against my trades, I've got more where that came from, or will in the future.

I have been dollar cost averaging in two educational accounts for my twin boys since the market top over a decade ago, and it reached new equity highs several years ago, while the broad market still has a ways to go, because I kept buying on a regular basis, regardless of what the markets were doing.

It is during times like these that I become quite philosophical. Hey, even auto traders need psychology coaching :D . I tell the market things like it can kiss my a$$, and it will have to pry my shares out of my cold dead hands...really profound stuff.

These difficult times shall pass just like every other, and I will continue to extract money from the market like a man panning for gold from the river.
 
I performed a YTD backtest of paper trading, and it would appear I am in the lead, dollar wise and PF. Folks can take it for what it is worth.

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