Quote from tradewon:
So looking back at your history do you acknowledge SCT failed now that MADA is the new black?
And why are your students and yourself so.. how can I put this delicately.. the opposite of wealthy?
To give you a better grasp of the three things I mentioned: plan, strategy and routine, let me elaborate.
In our session on Tuesday it was mentioned that there was a theory, process, and trading actually going on.
The foundation of what we do successfully is a paradigm named Pool Extraction Paradigm. PEP has to be applied to markets by taking into consideration market operation and capacity.
Pool extraction is a process that goes on all of the time in any market on any fractal as long as the market has sufficient liquidity.
There are three applications: PVT, SCT and SSR. You mention SCT which applies to a bout 80 markets in the category of financial futures indexes. Our fav is ES because of its capacity.
The basic plan for any usr of pool extraction is to use profits and compound them as fast as possible.
For PVT the cycle approaches 100 turns a year @ 10% nominal a turn. The capacity is limited to 100,000 shares perstream and up to 12 streams are used. A popular example, years ago was a 100,000 share trade which had a 17 point net (a point is a dollar in stock trading parlance. Partial fills were used; 20 to get in and 31 to get out. An IAS classifies the character of a stock and it goes into a Universe which is sorted by trade date, rank, duration and frequency. A one pager is used to trader the Universe; its name is Unusual Volume Sheet. MADA is used as the routine in PVT. Scoring stocks is also done as part of the DAS logging.
In 2010 beginners using this stuff did a first quarter @ a rate of 150K a year starting with 4 streams and about 25 to 35K total. By April the anualized rate grew to 250K. 62 trades were done in the first quarter.
Currently this week the Universe is being polished to begin 2011.
SCT trading is for financial futures indexes.It is being used all over the world currently. The process of using SCT involves annotating and logging. A core and a progression of skills is used to go from beginner to expert. There is one pattern involved for trading the trend by following a routine thatr takes sconds to cycle through. The pattern has three moves, two dominant and a non dominant in between. V and P are used to define the pattern; there are three price moves and four volume moves in the pattern.
Currently 10 cycles of learning have been posted. They take a trader through the various stages of expertise. The current P&L for the first 5 cycles is posted. 5K is taken to 3/4 of a million dollars. Expert trading is done at a multiple of he ATR; the multiples are well known.
SSR is an approach used for unlimited capital. Sector rotation is a common technique for big money and aggressive trading. The cycle is 4 1/2 weeks and only about 4% a week is realizable.
Any PEP based application for trading usually is done with three nested fractals (interlocking in a 3:1 ratio of segments); the middle fractal is the point to point trading fractal. People learn to trade by doing drills and the results have been posted in ET since its inception and before that on MSN forums. Before that(before the webb) by e mail and before that (before printers and the PC) by brownline handouts beginning in 1957.
Summary
You are confused in several ways. Most people are in your state simply because they are unfamiliar with non propabalistically oriented deductive based trading. what we do is a foreign language to you and here you have confused a PEP application (SCT) with a monitoring and ananlysis routine that is done repeatedly.
If you were an organized trader, you would have a monitoring and analysis routine. That being the case you would not confuse a routine with a strategy or an approach.
Most people cannot apply out written papers to trading simply because they substitute fragments for parts they do not understand. One of out fav examples of this is PVT trading wwithout a Universe and without an exit that occurs during the end of a cycle. A 25,000 trade test was used on 500,000 dollars. initial capital and the average trade lost 18 bucks. This is humor, we know.
At a tradersExpo, worden bros used their drag and drop and the NAZ 100 simulating a year. The Sharpe Ratio was the highest they ever recorded. The test was repeated because of the extreme result on a poor universe. An identical result occurred.
Your reading of failure on our part is incorrect, but it does serve to point out to others where you are coming from and how well you can understand the reality of PEP and its applications, PVT, SCT and SSR, and the routine MADA that is used to monitor and analyze the various markets.
Try putting us on ignore; it will get your mind off such things that seem so unbelievable and astonishing to you.
