# The financial year is over!  How did you do?



## Zaxon (28 June 2019)

With the last day of trading for this financial year over, the ASX/S&P 200 gained 6.8% for the year.  What was your return?  Did you try something new this year?  Did it work.  What mistakes did you make?  Are you changing how you invest/trade for the next year?

Here is the market's year graphed below.  So tell me about yours.


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## tech/a (28 June 2019)

Trading good enough given the time available.
Business wise down on last F/Y.
Got back into property about to buy my second for the year.

I expect alround improvement in all areas this coming year.
Optimistic


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## Zaxon (28 June 2019)

tech/a said:


> Got back into property about to buy my second for the year.



Well, the interest rates are certainly great for buying property, so that sounds good.  Residential or business property?


tech/a said:


> I expect alround improvement in all areas this coming year.
> Optimistic



Excellent.


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## tech/a (28 June 2019)

One of each 
The latest will be residential.


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## captain black (28 June 2019)

*What was your return? *

My returns exceeded the target I set so all the bills were paid and I get to trade again next year. 

*Did you try something new this year?*

I've begun to use an adaptive type of trade management in my futures trading systems this year. It's something I've been working on for several years but finally used it in live trading this year. It adjusts the trade risk management according to whether the market is trending or sideways etc.

I'm now looking at using it in share trading systems. So rather than trading multiple non-correlated systems there will be less systems using adaptive trade management.

*Did it work.*

Much better than I expected.

*What mistakes did you make? *

Several. None of them fatal 

*Are you changing how you invest/trade for the next year?*

Always learning new things so will introduce some different systems next year, but how I go about building and modelling systems wont change.


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## Zaxon (28 June 2019)

captain black said:


> *Did you try something new this year?*
> 
> I've begun to use an adaptive type of trade management in my futures trading systems this year. It's something I've been working on for several years but finally used it in live trading this year. It adjusts the trade risk management according to whether the market is trending or sideways etc.



Most system work best (or even only) in a certain type of market, so sounds like you're taking it to the next level.  Something we all should think about.


captain black said:


> I'm now looking at using it in share trading systems. So rather than trading multiple non-correlated systems there will be less systems using adaptive trade management.



OK.  So you're feeling adaptive management reduces your risk, so you can decrease the overhead of having to follow so many asset classes.


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## tech/a (28 June 2019)

Captain 
What’s your timeframe for futures?


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## captain black (28 June 2019)

tech/a said:


> Captain
> What’s your timeframe for futures?




Most of the signals are based on 2-minute bars but there are some market conditions where the system switches to 1-minute bars.


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## captain black (28 June 2019)

Doing some work on tick bars (20 tick , 40 tick, 60 tick etc.) but it's getting into the realm of the high frequency traders at that level and I can't compete with them. 1 and 2 minute bars is where I've found my niche.


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## tech/a (28 June 2019)

3 min for me and the DAX


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## captain black (28 June 2019)

tech/a said:


> 3 min for me and the DAX




I've tried the DAX a few times on different timeframes but it's a bit too volatile for the way I trade. My risk model works well on highly liquid markets like the Nikkei, ES, Bund etc.


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## tech/a (28 June 2019)

Never tried them 
Been looking at minis


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## So_Cynical (29 June 2019)

I had another good year, Net worth at an all time high, will pay the tax man about 4 or 5K and will sell
a heap of winners next week re-positioning for the coming recession and retirement 19 months away.


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## Zaxon (29 June 2019)

So_Cynical said:


> I had another good year, Net worth at an all time high



Job done then!


So_Cynical said:


> a heap of winners next week re-positioning for the coming recession and retirement 19 months away.



Are you taking the "I'm about to retire, so I had better put everything into safe, interest bearing assets" route, or the "I could live for another 30 years, so I need to be invested in high growth assets" approach?


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## Gringotts Bank (29 June 2019)

Improved.  Combining a mechanical system with discretionary assessment of sentiment.  The mechanical system itself is about as tweaked as I can make it, though I'm always looking for a higher win rate.  For me, getting my WR high requires some trawling through HC posts assessing sentiment.  Ideally I'd like to systematize this step, but manually trawling through HC posts still seems to be more accurate.

So to optimize my manual sentiment analysis, I am continuing to work on aspects of psychology.  Getting in a flow state is hard to do, but is the holy grail, imo.


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## Zaxon (29 June 2019)

Gringotts Bank said:


> Combining a mechanical system with discretionary assessment of sentiment.



I hear of some value investors who combine that with sentiment, to try and improve their performance. But you mentioned win rate, so you're more of a trader?


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## Gringotts Bank (29 June 2019)

This video is still one of the best for understanding the psychology of trading, and worth re-posting.  There is _*so *_many clues in it.  Every aspect is covered - beliefs, motivation, self-worth, self-sabotage, flow state, confidence.... the lot.  It's easy to look at this burnout and be put off.  But there's  wealth of information here.  He has been extremely successful and he has blown up.  Both are addressed, but you really have to read between the lines to extract the lessons.


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## Gringotts Bank (29 June 2019)

Two of the most important lessons, one positive, one negative.

1. When you're winning, bet more.  Position sizing should increase when you're in the zone and/or when your system is perfectly aligned to the market phase.  Conversely, position sizing should shrink (*rapidly*) when your system and the market are out of phase and/or when you're not in tune with the markets personally.  Obviously there needs to be an upper limit.  That upper limit should not just be determined statistically, but in terms of one's ability to sleep at night.

2.  In the second half of the video he talk about how everything changed when he made it big.  He bought the luxury house and the expensive toys and then _*suddenly* _started losing every day.  Why?  Limiting beliefs and self-sabotage are very clearly in play here.  He did that to himself without knowing why.  The only thing his mind could do was to blame 'god or some spiritual thing'.  He knew something was wrong but couldn't unpack it.  He wanted success, got it, then realized a part of him wasn't comfortable with it.  That uncomfortable part needs processing because it's unecessary, and it blocked his success.


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## Gringotts Bank (29 June 2019)

Some subtle lessons.

2:13 "...because you've made it".  Look at his upper lip curl and his nose scrunch.  Body language is indicating contempt as he references having "made it".  How can he maintain his winning streak when he has contempt for winning?  So there's contempt, but there's also envy ('everyone has a Rolex - all I could think about').

2:30  "go on an expensive vacation..." then a _very _obvious eye accessing cue indicating a constructed inner voice, which he nearly divulges before quickly changing topic.  It wasn't positive.

2:18-2:30 The left-right-left-right movements of his head are an outer show of the inner battle between left and right brain hemispheres.  Old memories in the right brain haven't been integrated.

2:09 'god or some spiritual thing'.  Religion and worthiness are heavily intertwined.  It goes back centuries.  So it's likely he had a religious upbringing or schooling.  The other possibility is that he uses the word 'God' as a metaphor for a parent who held certain views about life, money, worthiness etc.

Because he's drunk, it's all there to see.  If he was sober it would be much harder to discern exactly where it went wrong for him.  I hope he found a good coach and is back in black!


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## Gringotts Bank (29 June 2019)

More...

"I f'd a Playmate.  Isn't that what every guy's dream is?".  He aims to achieve 'every guy's dream' rather than his own true dream, which means he is focussed on impressing his colleaugues.  So the trading is not a true desire but a tool.  This plus the envy/contempt provides a very powerful driver for success ("you what what?  I can beat these guys"..._ and there wasn't a shadow of a doubt; he knew it_).

But there's a built-in problem here.  As soon as he beats them, what is there to continue driving the successful behaviour?  Nothing internal, that's for sure.  This is yet another reason for the collapse.

"They hate me at the Merc".  He created that reaction to add fuel to the fire of his contempt, because contempt was driving his success.  [Sports people sometimes do this].  So the original goal of winning favour with his colleagues was never going to happen, right from the start.


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## qldfrog (29 June 2019)

Interesting post GB
This year has strangely been a good year thanks to my pessimist side, my Bboz losses where more than offset by the gold and usd, bond positions...at last some smile at tge end of the year
And got the time to follow Skate then worked on starting my own system..liked it the design phase, the scare and thrill of starting
One regret i started late and missed the January jump...
Still managed to do many beginner errors  buying Sea on a feeling and selling after losing 2.5k

Where was my analysis, my stop loss etc etc.. i should know better by now ...
Will do better next year, have to as my miss and i  entered retirement and are probably 15y away from pension access...
A good year


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## Zaxon (29 June 2019)

qldfrog said:


> Interesting post GB
> This year has strangely been a good year thanks to my pessimist side, my Bboz losses where more than offset by the gold and usd, bond positions



Interesting.  So it was straight out negative expectation for the market as opposed to using BBOZ for hedging?


qldfrog said:


> One regret i started late and missed the January jump...



Yes, Jan was very significant, in fact, this whole calendar year has seen massive growth.  Not much good if you're holding BBOZ though 


qldfrog said:


> Still managed to do many beginner errors  buying Sea on a feeling and selling after losing 2.5k



Not a good second half to SEA.  To some extent, it tracked similarly to BBOZ.


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## Klogg (29 June 2019)

Best year I've ever had. Returns about 120%, plus some extra from consulting work.


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## Zaxon (29 June 2019)

Klogg said:


> Best year I've ever had. Returns about 120%



Wow.  Impressive.  Are you an investor or trader?


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## qldfrog (29 June 2019)

Zaxon said:


> Interesting.  So it was straight out negative expectation for the market as opposed to using BBOZ for hedging?
> 
> Yes, Jan was very significant, in fact, this whole calendar year has seen massive growth.  Not much good if you're holding BBOZ though
> 
> ...



As most, i have a lot of my wealth in RE, land and house on it, an investment property: residential on the coast and a small warehouse,
Also some super plus my portfolio so i find it wise to insure/edge that australian exposure with some bboz
A RE crash will in my opinion be matched by an asx crash if only with the weight of banks
I also edge with gold and usd exposure.
Let's be honest, when the aud goes from 1 usd to 69c, i lose 30pc of my wealth
So if the asx or my portfolio goes up 10pc, lower after paying tax,i im a looser anyway in usd not even considering inflation
My view....


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## Klogg (29 June 2019)

Zaxon said:


> Wow.  Impressive.  Are you an investor or trader?




Investor.

ANO and DDR my 2 largest holdings - collectively now make about 70% of holdings. Explains the gains


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## So_Cynical (30 June 2019)

Zaxon said:


> Are you taking the "I'm about to retire, so I had better put everything into safe, interest bearing assets" route, or the "I could live for another 30 years, so I need to be invested in high growth assets" approach?




30/70 or there about - will soon be about 30% safe and 70% at risk, with just maybe half of that risk at the higher end, one has to stay the growth road but well one has to put some out of harms way.

----------------

Interesting look back - 2009 FLOORED The Complete Documentary Film.


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## Zaxon (30 June 2019)

Klogg said:


> ANO and DDR my 2 largest holdings - collectively now make about 70% of holdings. Explains the gains



It does indeed!  I made 56.3% this financial year. I also own ANO, although for me, it's 14% of my holdings.  I also owned DDR, but don't now.

Do you consider yourself a momentum investor, or more long term where you would hold ANO and DDR even if they trended sideways for a long time?


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## basilio (30 June 2019)

Zaxon said:


> It does indeed!  I made 56.3% this financial year. I also own ANO, although for me, it's 14% of my holdings.  I also owned DDR, but don't now.
> 
> Do you consider yourself a momentum investor, or more long term where you would hold ANO and DDR even if they trended sideways for a long time?




Interesting thread and worth exploring.
When you talk of making "56%" in the financial year Zaxon is that realised gain or improvement in share values or other stock ?


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## Klogg (30 June 2019)

Zaxon said:


> It does indeed!  I made 56.3% this financial year. I also own ANO, although for me, it's 14% of my holdings.  I also owned DDR, but don't now.
> 
> Do you consider yourself a momentum investor, or more long term where you would hold ANO and DDR even if they trended sideways for a long time?




Definitely long term. Held DDR for 4 years so far, ANO about 14 months.

Momentum does not come into my thought process for making an investment. It's purely a function of expected cash flows vs the price paid.


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## Zaxon (30 June 2019)

basilio said:


> Interesting thread and worth exploring.
> When you talk of making "56%" in the financial year Zaxon is that realised gain or improvement in share values or other stock ?



Think of it like a mutual fund.  I'm measuring total funds under management.  Stocks sold are immediately reinvested.  The 56% is from 1-Jul-2018.

With the mini crash in the market late last year, I started graphing my results from Oct 12, to make sure I was doing my job. At the end of each weak, I plot the current portfolio value against the US and ASX indices.  Hopefully, I outperform them  




This year I went "professional", as in earned an equivalent to a full time wage from my investing.  Zaxon's past performance is no guarantee of future results, but we can always hope


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## peter2 (30 June 2019)

I hope I don't shock too many of you by stating that I've had one of my worst FY performances. This applies only to the part of my SMSF that trades in ASX stocks. I fell victim to my own mind. 

Let me outline what I mean. My portfolios got off to a blistering start gaining 10% in the first two months (July, Aug18). In Sep18 the markets started to decline. I wasn't concerned about the underlying eco fundamentals and bought a position in the market ETF GEAR. The plan was to hold GEAR through the dip and add every time the XAO fell another 10%. I anticipated that the market wouldn't fall by more than 20%. (It didn't, falling -15%). However the GEAR ETF is geared (x 2.4) and this caused my portfolios to suffer draw downs greater than my self imposed -10% limit. My worst portfolio hit -13% and this concerned me greatly.  This was a classic example of not being prepared for this outcome. **

**_ XAO fell 15% meaning GEAR should fall ~36%, in fact GEAR fell 33%. So, with a position size of 30% I should have anticipated a portfolio DD of 33% of 30% or -10% plus a few extra % for losses realised from stock trades when the market fell. I should have expected to have a DD between 10-15% and stuck to the plan to buy more when the rally started. _

The rally started Jan19 and I did not add to the position because I was overly concerned about the larger than allowable DDs. The rally continued higher and I soon realised that I'd missed the opportunity to add to the GEAR position. The R:R was not acceptable in Feb/Mar19. My mind was in the Twilight Zone not the Trading Zone.

Having totally messed up my attempt to be a longer term "investor" with a good portion of my portfolio, can you imagine my trading mindset at the time?  It wasn't in a good place. One thing I've never done is to chase price. If I can't or don't buy it at the correct time and price I'll let it go. I let a lot of great trends go higher without me. 

Currently my portfolios are a few % below equity highs instead of at new highs. I'm greatly disappointed by my failure to stick to a plan and to be so negatively influenced by known psychological biases. 

If this can happen to me then it can happen to anyone. It may also be a good example why many people prefer mechanical/automated trading methods.


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## Zaxon (1 July 2019)

peter2 said:


> I hope I don't shock too many of you by stating that I've had one of my worst FY performances.
> If this can happen to me then it can happen to anyone. It may also be a good example why many people prefer mechanical/automated trading methods.



What a very instructional story.  We need to be sharing both our good and bad stories, and often as a community we learn far more from when something didn't go right, so thanks for sharing this.

Are you going to continue to hold a portion of your assets using a longer term strategy, or has that scared you off for now?


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## PZ99 (1 July 2019)

Mine will be hard to work out. I think it's around +44% all up ~ around 30% on paper and the rest in trading gains.


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## Zaxon (1 July 2019)

PZ99 said:


> Mine will be hard to work out. I think it's around +44% all up ~ around 30% on paper and the rest in trading gains.



Very impressive.  You don't keep a tally as you go?  I guess as a trader, you're really only tracking the closed trades.


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## PZ99 (1 July 2019)

Zaxon said:


> Very impressive.  You don't keep a tally as you go?  I guess as a trader, you're really only tracking the closed trades.



My record keeping is very sloppy. Need to pull my finger out this year


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## Knobby22 (1 July 2019)

I think I'm around 15-20% trading gains. Will work it out for tax reasons in a few weeks.


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## Zaxon (1 July 2019)

Knobby22 said:


> I think I'm around 15-20% trading gains. Will work it out for tax reasons in a few weeks.



Very good!  How long do you typically hold your trades for?


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## Knobby22 (1 July 2019)

6 months average.


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## captain black (1 July 2019)

We trade over 20 systems across a variety of markets but the focus here is on ASX returns so I'll post our best and worst system returns on the ASX. We haven't been able to get a Mean Reversion type system to work on the ASX so the results are from our Momentum and Trend Following systems.

The momentum systems are traded with 10 positions each with a position size of 15K. Returns aren't compounded as we've found it too difficult to move in and out of small cap stocks with greater than 15K.

The trend following systems are traded with 20 positions each with a position size of 15K. Once again, returns aren't compounded for same reason.

*Momentum.*

*Best:*

_IBIS system (with machine learning based filters)_

Return: 99%

Winners : 57%
Losers  : 43%

Avg Win : 12%
Avg Loss : 7%

*Worst:*

_Rakali System_

Return : 45%

Winners: 42%
Losers : 58%

Avg Win : 10%
Avg Loss : 5%


*Trend Following.*

*Best:*

_Hawk System_

Return: 41%

Winners : 39%
Losers :  61%

Avg Win : 33%
Avg Loss: 10%

*Worst:*

_BlueWren System_

Return: 14%

Winners : 31%
Losers  : 69%

Avg Win : 34%
Avg Loss : 10%


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## tech/a (1 July 2019)

CB

We--Our?

20 systems average $15K over Average 15 positions 
$4.5 Million to run.
You have a group funding these? 
Or are they Paper traded?
Do you lease them?

If $15K is an issue getting in and out of a trade does liquidity play a part in the system filters at all?
If not do things NOT improve with one (I'm sure you've tested this).

Terrific results by the way---even the worst results!


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## captain black (1 July 2019)

tech/a said:


> We--Our?




I have a trading partner with a background in sysadmin/server management who has helped automate all the systems. We trade our combined capital as well as our own separate accounts.



tech/a said:


> 20 systems average $15K over Average 15 positions
> $4.5 Million to run.




Most of the 20 are day traded futures systems so don't require the same capital as share trading. It's more than $1 million overall but not $4.5.



tech/a said:


> Do you lease them?




No, all our own systems. After 20 years I've built up quite a collection and my partner has a few of his own as well.



tech/a said:


> If $15K is an issue getting in and out of a trade does liquidity play a part in the system filters at all?




Definitely. We don't restrict ourselves to the ASX200 or the All Ords so we pick up quite a few small caps. When they have momentum behind them getting in and out isn't an issue but momentum can dry up very quickly so we tend to take profits in our momentum systems when volume is still high.

This has been an exceptional year with quite low drawdowns. I mentioned in my futures thread about a drawdown of 35% in one of my momentum systems back in 2011. That was at the same time as I got caught up in the MF Global bankruptcy. I nearly gave it all away, thankfully I didn't.


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## tech/a (1 July 2019)

captain black said:


> No, all our own systems. After 20 years I've built up quite a collection and my partner has a few of his own as well.




Thanks CB

What I meant was do you lease them to others like they do on these types of Platforms

https://www.optimizedtrading.com/leasing.html

This is simply an example. I know nothing about them.


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## captain black (1 July 2019)

tech/a said:


> What I meant was do you lease them to others like they do on these types of Platforms
> 
> https://www.optimizedtrading.com/leasing.html
> 
> This is simply an example. I know nothing about them.




Ah, sorry tech, misunderstood, thought you were asking if we lease in other's systems.

I wouldn't ever lease the share trading systems to someone else because of the liquidity issues. I don't want to be competing in the open and close auctions in small cap stocks with someone else trading the same systems.

The futures systems dont have the same issues with liquidity but leasing them out isn't really something I've thought about.


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## IFocus (1 July 2019)

Stunning numbers Captain and congratulations to everyone else.

Your story Peter is interesting but I note your conscious observance of the issues very professional and sets you well apart from a punter. 

I was looking to start trading again last year after a long lay off and run a whimsical thread on my return but ongoing health issues have kept me out.

Ironically a detached retina got me into the market 5 weeks ago 

Up a couple of percent trading and about 12% for the super. Caught the run up in gold for Super and missed most of the big breakouts in trading.

I am still at punter level and will need to get up to speed quickly as this current trend will end soon.


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## Zaxon (1 July 2019)

captain black said:


> We trade over 20 systems across a variety of markets but the focus here is on ASX returns so I'll post our best and worst system returns on the ASX.



Excellent performance!  And a good amount of detail you've given.  You sound like you're doing a lot of A/B testing of portfolios against each other. Are you finding consistent winners, or does it end up being more that, say, IBIS outperforms in this market, and Rakali outperforms in another?


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## Zaxon (1 July 2019)

IFocus said:


> Caught the run up in gold for Super and missed most of the big breakouts in trading.



Gold ETFs or gold miners?


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## IFocus (1 July 2019)

Zaxon said:


> Gold ETFs or gold miners?





You always pretty much always gain a higher return (about x2 plus) from owning gold miners rather than an ETF I was a little conservative and bought SAR and NCM.


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## sptrawler (1 July 2019)

Well I'm still self funded, so that is good, still have the same capital I started with so I'm happy.


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## Zaxon (1 July 2019)

sptrawler said:


> Well I'm still self funded, so that is good, still have the same capital I started with so I'm happy.



Yup. If your investment returns can cover all your costs, there's not much more you want out of life.  Did you add a little bit extra for inflation?


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## sptrawler (1 July 2019)

Zaxon said:


> Yup. If your investment returns can cover all your costs, there's not much more you want out of life.  Did you add a little bit extra for inflation?



No just removed less than I made.
Which will become more difficult as I age and drawdown requirements increase.
But thats how it is meant to work


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## leyy (2 July 2019)

I had a very good year.

What was your return? 

Average Net P&L for all portfolio's is 52% (Trading profits and loss, including realized and unrealized profit and loss, less brokerage and including dividends) No leverage.

Break down of the above P&L

SMSF Net P&L is 20% Gain (More risk adverse, Chasing higher dividend yields and only ASX 300)
Personal #1 Net P&L is 98% Gain (Medium-Long Term, Small-Mid cap equities, Chasing Capital Growth, Trend following)
Personal #2 Net P&L is 84% Gain (Medium-Long Term, Small-Mid cap equities, Chasing Capital Growth, Trend following)

Average Days Held: 382 days

Biggest winners are: APX, JIN, WTC, APT

Did you try something new this year? Yes, I started to take more profits on the big winners and reinvesting them in new opportunities.

What mistakes did you make?  BAL, BKL, BIN, PPS, KGN were my big losers. I cut them off a bit later than I would have liked (lesson learnt). I entered in these stocks when they retraced rather then breakouts and signals were not strong enough confirming a change in trends.


Are you changing how you invest/trade for the next year? Seems to be relatively successful so will keep at it and continue to fine tune.


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## So_Cynical (2 July 2019)

I ran a report last night, FY up about 15% with dividends - all closed trades, 14% open trade profit, biggest mistake was breaking my own rules and being a little emotional, took an average down that i just should not have taken, i just should of waited and i would of made a better decision the stock has no pretty much gone to zero, the other mistake was selling APT to early, i could of made 70K on that stock but only ended up with a bit over half that.

Looking back over the last 10 years its the 4 stocks that have gone to zero on me that (surprise surprise) have really hurt returns wise, i average about low teens but with those zero stocks taken out i would be well into the 20's.


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## Zaxon (2 July 2019)

leyy said:


> Average Net P&L for all portfolio's is 52%



An amazing result.  Well done!


leyy said:


> SMSF Net P&L is 20% Gain (More risk adverse, Chasing higher dividend yields and only ASX 300)
> Personal #1 Net P&L is 98% Gain (Medium-Long Term, Small-Mid cap equities, Chasing Capital Growth, Trend following)
> Personal #2 Net P&L is 84% Gain (Medium-Long Term, Small-Mid cap equities, Chasing Capital Growth, Trend following)



Very interesting break down here.  Would you ever consider bringing your trend following into your SMSF?  Or do you feel you need a dividend approach to compensate for years where your personal portfolios won't do so well?


leyy said:


> Did you try something new this year? Yes, I started to take more profits on the big winners and reinvesting them in new opportunities.
> 
> What mistakes did you make?  BAL, BKL, BIN, PPS, KGN were my big losers. I cut them off a bit later than I would have liked (lesson learnt).



Thanks for the excellent level of detail.  It gives us a really good insight into your year.


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## investtrader (2 July 2019)

Weekly system 20 positions. Account size > $1mill (which is only relevant as it is easier when trading smaller)


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## captain black (2 July 2019)

Zaxon said:


> Excellent performance!  And a good amount of detail you've given.  You sound like you're doing a lot of A/B testing of portfolios against each other. Are you finding consistent winners, or does it end up being more that, say, IBIS outperforms in this market, and Rakali outperforms in another?




Sorry @Zaxon I missed this earlier.

We have systems that outperform other systems over the long run and in a perfect world we'd be trading my Ibis system with a lot more capital but because of liquidity issues with small cap stocks we're limited to only $150K for that system so we trade other lower performing systems rather than having cash sitting idle.

Liquidity on the ASX is the one of reasons we trade overseas stock markets as well as futures.


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## Zaxon (2 July 2019)

investtrader said:


> Weekly system 20 positions. Account size > $1mill (which is only relevant as it is easier when trading smaller)



Good result. I think 20 positions captures the sweet spot between being concentrated for performance, and not being reckless, so it's good to see that carried through to larger accounts.

I'm going to assume you're an investor based on what you've shown.  What style do you do?  So far in this thread we've seen momentum, trend, long term hold and some traders. I'm thinking the value investors are hiding at the moment, as far as people who've given actual results.


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## leyy (2 July 2019)

Zaxon said:


> An amazing result.  Well done!
> 
> Very interesting break down here.  Would you ever consider bringing your trend following into your SMSF?  Or do you feel you need a dividend approach to compensate for years where your personal portfolios won't do so well?
> 
> Thanks for the excellent level of detail.  It gives us a really good insight into your year.





Yes definitely given it is more profitable. However, I need to take a more conservative approach as I manage the superfund for several family members so my risk tolerance is much lower compared to my own personal accounts where it is just my money on the table.


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## Newt (2 July 2019)

Weekly trend trading about 15 positions ASX:

Up 11% on closed positions this FY  (41% Wins, 59% Loss)

Don't like to celebrate open profits in a sluggish weekly system too loudly, but for Closed+Open profits accross the FY:   Up 31%

The DD at the end of last calendar was not fun, but the climb up to new equity highs this year made up for things.  Hope Captain doesn't jinx us too soon mentioning small cap returns are well above norm currently


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## willoneau (2 July 2019)

EFY ,
weekly system=22%
recent daily system=-9%


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## Zaxon (3 July 2019)

Newt said:


> Up 11% on closed positions this FY  (41% Wins, 59% Loss)
> Don't like to celebrate open profits in a sluggish weekly system too loudly, but for Closed+Open profits accross the FY:   Up 31%



That's a good result.  I've noticed the trend traders/investors have done well this year, based on those posting in this thread.


Newt said:


> Hope Captain doesn't jinx us too soon mentioning small cap returns are well above norm currently



Over the last 12 months, small caps have underperformed large caps.  However, some individual small caps have done very well, so it all comes down to stock picking.


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## Zaxon (3 July 2019)

willoneau said:


> EFY ,
> weekly system=22%
> recent daily system=-9%



Good return on your weekly.  Were the systems you used different, or just the timescales?


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## willoneau (3 July 2019)

the daily was made up of different strategy as posted , but then reverted to same as weekly for entry signal but different money management was introduced. Still a work in progress though.
I am impulsive and can over trade so realize i need to follow a mechanical system and not a discretionary system as i tried following tech/a .


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## Value Hunter (3 July 2019)

The past financial year my gross share portfolio performance was a gain of around around 63% unrealized gains on total assets. (On equity capital it is higher due to leverage being used). There were no realized gains or losses). In addition I did receive some net dividend income.

It is based on a concentrated portfolio and a long-term value investing approach with very little turnover in holdings.


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## Zaxon (3 July 2019)

Value Hunter said:


> The past financial year my gross share portfolio performance was a gain of around around 63% unrealized gains on total assets. (On equity capital it is higher due to leverage being used).



Impressive.  And good to hear from a value investor.  It seems they've been hiding.  How much leverage do you use?


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## Value Hunter (3 July 2019)

Zaxon for me leverage varies and is not a static amount. In my share portfolio I am currently around 40 - 45% gearing.


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## kahuna1 (6 July 2019)

Hi ho ...

Well ... if one makes 30% a year, 21% after tax consistently from 100k in 10 years your 650k.
Even taking out inflation, and say an after tax 18% consistent return, your at over 500k year 10.

Year 20 ... in very real inflation adjusted terms your 2.5 million.
Year 30 ... around 13 million.

Whilst having a well diversified and lower risk portfolio is not sexy on these sites, a few, choice picks and held for some time say like CSL or MFG up 50 fold in 10 years spans ... CSL did its run earlier ... and then picking the eyes out of rallies and reducing and conversely buying onto panic like late 2018 ...

It is possible. Of course I have been mean with the 30% tax rate, but company tax rate, verses say holding a stock once its 5 times up, capital gains ... makes it unwise and not advisable to play too much into rallies and cycles until if you decide to take the money off the table as it gets quite idiotic.

Anyhow, just food for thought, each to their own. 

Hasten slowly.


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## Zaxon (6 July 2019)

kahuna1 said:


> Well ... if one makes 30% a year, 21% after tax consistently from 100k in 10 years your 650k.
> Year 20 ... in very real inflation adjusted terms your 2.5 million.
> Year 30 ... around 13 million.



13 million is about what I deserve.  Off to make 30% a year, with no negative returns ever...


kahuna1 said:


> Whilst having a well diversified and lower risk portfolio is not sexy on these sites, a few, choice picks and held for some time say like CSL or MFG up 50 fold in 10 years spans ... CSL did its run earlier ... and then picking the eyes out of rallies and reducing and conversely buying onto panic like late 2018 ...



Yes, a few choice shares like CSL and MFG held for decades could set you up for life.  Although that sounds more like an argument for a concentrated portfolio in "choice" shares, rather than for a diversified one.


kahuna1 said:


> It is possible. Of course I have been mean with the 30% tax rate, but company tax rate, verses say holding a stock once its 5 times up, capital gains ... makes it unwise and not advisable to play too much into rallies and cycles until if you decide to take the money off the table as it gets quite idiotic.



Yup. In the perfect, low-taxed portfolio, you would be paid no dividends, hold everything for > 12 months, and never sell a single share until you needed the money.  Perhaps some people do that.


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## HelloU (6 July 2019)

confused here, 
kahuna,
i thought u said in the other thread that you were slowly selling shares cos you thought the market was too hot? Did i misread that when i thought you were moving into cash due to your world concerns?

(or maybe i misread this?  i thought here you were advocating holding thru thick and thin ..... did i get that interpretation wrong here? ... i do find it difficult to work out what you are saying in most of your posts but that is not said to be a criticism)


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## kahuna1 (6 July 2019)

Zaxon said:


> Although that sounds more like an argument for a concentrated portfolio in "choice" shares, rather than for a diversified one.




Well, as someone who for 25 plus years has shared ideas and portfolios .... ONE ... let alone two monsters even at 3% initial investment for  something that goes nuts, can and will take over the portfolio. NOT decades ... but around 5-10 years the lions share is made. 

ONE flea, split in half, then split again and went from well 20 cent entry and then free shares so 5 cents to up near $10- and essentially one doesn't need much to take over the portfolio when its risen 200 times.

CSL is up there, MFG and NO its not PDN or even FMG ,,, which my love hate affair with some stocks and FMG at over $10- pre GFC replaced with a love under $2- ... 

Now, well ... at all time highs and scant prospects out there for the next big thing, I have no brilliant ideas as were around say in the 1995 -2000 period and even 2006-10 rise and GFC fallout.

One I am sure will come along, and a mere 3% goes nutty as it does sometimes and even a big portfolio ends up being 50% one stock. Of course, being prudent, I reduce and at times confound followers of some stocks such as the rise and fall of SLX which had a massive breakthrough and went 10 fold in short order and I exited, due to the fact that even if things went right, which they DID not, despite world beating technology, it was reflecting a price 15 years into the future.

Such is life.


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## Zaxon (6 July 2019)

HelloU said:


> confused here,
> i do find it difficult to work out what you are saying in most of your posts



Yes, it can be tricky.  I feel like it's gone through Google Translate a few times.


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## Zaxon (6 July 2019)

kahuna1 said:


> Well, as someone who for 25 plus years has shared ideas and portfolios .... ONE ... let alone two monsters even at 3% initial investment for  something that goes nuts, can and will take over the portfolio. NOT decades ... but around 5-10 years the lions share is made.



For those investors who like to "rebalance" outperforming shares, because they judge them as to risky - let's call them "reversion to the meaners", they probably wouldn't benefit from long term, high growth stocks.  But if you're prepared to hold on to your winners, it's definitely a good strategy.


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## kahuna1 (6 July 2019)

HelloU said:


> confused here,
> kahuna,
> i thought u said in the other thread that you were slowly selling shares cos you thought the market was too hot? Did i misread that when i thought you were moving into cash due to your world concerns?




YEs I am ... and whist I just posted ... there are few if any stocks that amuse me right now. MFG at $55- verses $1- ignoring tax implications ... is basically a leveraged punt on the AUD going down and the USA stocks going up. 

Of the rest, I was not in love with banks, but twice was compelled to add pre Royal commission results when yields implied had them at 7% plus ... then they bounced 15% .... only to be spanked again as the market tanked late 2018 .... and visited similar levels ... 

Different styles and objectives.
Is there a CSL ... or MFG or say shiny spec or mining stock I like or love here ? Well NO and most I look at or that are suggested are trading as though perfect conditions will apply and more than likely contain absurd profit assumptions unlikely to be met.

When a tech stock with 177 mio sales is trading at 10 billion market cap, much like in the 1999-2000 period, I know either I have lost my mind or they have.

History tells me, even if my exit and removal of large swathes of stocks up here at all time highs for the USA is wrong, I will ... guaranteed during the next correction get to enter likely 10/% lower even in a mild market correction of say 8%. Individual stocks even the biggest winners, such as say CSL or even JBH Jb Hi Fi during a 10% correction they quite often get slammed 20% if not 30% year over time, they are the very best long term performers.

Confusing ... and little to do with charts ... more a fundamental Macro style outlook married with valuation on a fundamental basis. YEs ... sure ... the chart helps but not to see some imagined trend ... but to measure how stupid the correction gets and whilst people run for the exit, in the midst of end of the world, you buy stocks.

Any stock that is worthless and a lot are, if one just looked at a chart, even for say One Tel which went bust many moons ago, i am sure it was worthless for at least 5 years porior to bust, yet the chart would be telling the devoted followers it was a buy at $3= or $10- when ... it was worth ZERO all along.

Uranium bull market pre GFC ... so much hot air, so many things going on ... a short term under-supply was seen as the end of the world, a mine flooding and such absurd bullish comments, yet economics of a nuclear reactor in 2006 cost DOUBLE per KW h unless built in China with ultra cheap labour and then one got to permits and public outcry .... let alone the fact that at $120- lb, there is enough Uranium to supply the world needs for 100 years. One mine alone, BHP Olympic dam ... had 20 years worth, not aoffical at the time, but decent research and WMC who was taken over by BHP had drilled and confirmed the size fairly reliably ....

Anyhow .... worthless trash, rose from 1 cent to $10- in some cases, few were in at 1 cent, everyone was an expert at $10- .... now the stock ... 35 cents ? So so many of these abound.

So nope, not holding my breath here on tech side, or some medical stock that may or may not discover something, or well a miner which without Xray vision or a very good idea from old drills what lies below a waste of time.

CDU ... whatever they are called now, copper deposit near Cloncurry, now company broke ... went up and since I knew the area, and ground, and watched amazed, not owning, I noted RIO had drilled the site and dismissed it. Eventually after much hot air, years of it, ASX and ASIC involved ... I wince at the amounts lost ...

Then again, chart wise, buying a frog that's worthless is irrelevant and eventually, one day, out of the blue ... ooohh ... they are in receivership ... your shares are worth zero.

Of course, in a bull market with lots of suckers out there, less likely as the scam can be passed on .. and on and ON .... one stock I love to hate has drilled 1,000 odd holes and charged 1.5 million management fees for each year, never found a thing, but every 12-18 months a media blitz and hopes are ignited, new suckers abound ... new share issue ... and it was that good they got another company with the same model and same fees ... neither ... has ever mined anything other than suckers wallets and are unlikely ever to make a profit.

Then again, miracles occur, but rarely ... and if I were asking to get the 30 million its been sucked dry for over the past decade back, .... 

I have digressed ... bottom line at all time highs in what is a very strange and risk loaded global market let alone violent ... to have it ignored and at all time valuation highs verses GDP in the USA is a good place to hide and see what occurs.

Take care .


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## kahuna1 (6 July 2019)

Zaxon said:


> For those investors who like to "rebalance" outperforming shares, because they judge them as to risky - let's call them "reversion to the meaners", they probably wouldn't benefit from long term, high growth stocks. But if you're prepared to hold on to your winners, it's definitely a good strategy





Nothing like misquoting me !!
When a stock, a 3% hold rises 10 fold and becomes 30% of a portfolio and then doubles, which does occur but rarely, calling it a reversion to mean is ... silly.

Go look at MFF holdings and records of their holdings and how long the top two have been held, Visa and MasterCard. 

P.S he, the fund manager is in the top 100 of all value fund managers in the world. Co founder of MFG ... and well ... its not a great analogy, but as the index has risen, a 3% hold has gone to a 12% hold as the stock has risen at 3 times even the index gains.

I would read his comments on the 30th June 2019 and his views, somewhat similar to my own. I have the flexibility to be more proactive than he does with a fund and exit and enter .... but when a person who rode the GFC and well outperformed the overall market as the fund manger of both MFG and MFF at the time, well ... I think he may know his stuff. Outperforming the stellar returns of the index and even after fee's 90% of fund managers fail on 3,5, and 10 year time frames. TO beat it, by 2%  .... 96% fail on and as I said ... top 100 out of 10,000 is ... well 99% ... astounding. Buffett post 2000 not even close.

Each to their own.


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## HelloU (6 July 2019)

kahuna1 said:


> YEs I am ... and whist I just posted ... there are few if any stocks that amuse me right now. MFG at $55- verses $1- ignoring tax implications ... is basically a leveraged punt on the AUD going down and the USA stocks going up.
> 
> Of the rest, I was not in love with banks, but twice was compelled to add pre Royal commission results when yields implied had them at 7% plus ... then they bounced 15% .... only to be spanked again as the market tanked late 2018 .... and visited similar levels ...
> 
> ...



thanks mate, that one i could work my way thru ok and no more to clear up, cheers.


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## Knobby22 (9 July 2019)

Worked it out.

I made 22% for the year and cashed 17% which was used to pay off some of my share loan and house loan as well as pay for my wife's significant birthday party.

Returns exclude dividends which were used to help pay share loan interest. Share loan is down from $143,000  to $132,000

I think it was a combination of the rising ASX, stock picking and trend trading.
Easiest year in a while. Avoiding banks has been a good tactic.


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## 12Percent (10 July 2019)

*What was your return? *

17.5%

*Did you try something new this year?*

Model based value strategy.

*Did it work.*

Yes, almost hit the back tested averages for the strategy, only my second year of active investing so happy with the percentage above the index. 

*What mistakes did you make? *

Had a side gamble on a spec stock based on possibilities rather than probabilities, lesson learned, never again. 

*Are you changing how you invest/trade for the next year?*

Hopefully not.


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## Zaxon (10 July 2019)

12Percent said:


> *What was your return? *
> 17.5%



Excellent.  You outperformed the index.  Well done!


12Percent said:


> *Did you try something new this year?*
> Model based value strategy.
> 
> *Did it work.*
> Yes, almost hit the back tested averages for the strategy, only my second year of active investing so happy with the percentage above the index.



It's always interesting to see how backtested methods go when they're released to the wild.  So far so good.


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## statmech71 (13 July 2019)

Hi Zaxon — loving the thread and a big thanks to all the contributors willing to share.

My return was close to 100% for the year starting from a small account. I use a momentum based system inspired partly by Tech/a 's approach — so many thanks to Tech for so generously sharing his insights on his threads. 

Ive now dedicated more funds following the initial success and have in the meantime developed my own code to backtest it more formally and have confirmed the positive expectancy of the system in diverse market conditions.

Next phase for me is system optimisation and development of more systems. This forum is a fantastic source of information and Im brimming with ideas. Looking forward to the journey. 

All the best with your trading ASFers. 

Paul


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## Zaxon (13 July 2019)

statmech71 said:


> Hi Zaxon — loving the thread and a big thanks to all the contributors willing to share.



Agreed.  


statmech71 said:


> My return was close to 100% for the year starting from a small account. I use a momentum based system inspired partly by Tech/a 's approach — so many thanks to Tech for so generously sharing his insights on his threads.



Very impressive!  That settles it.  I'll just give you all my money next year 


statmech71 said:


> Ive now dedicated more funds following the initial success and have in the meantime developed my own code to backtest it more formally and have confirmed the positive expectancy of the system in diverse market conditions.



How long is your average holding period of a position?


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## statmech71 (13 July 2019)

Haha: Youre brave! 

Holding period about 8 days for winners and 4 days for losers. But can hold for up to 1 month.


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## investtrader (15 July 2019)

captain black said:


> I have a trading partner with a background in sysadmin/server management who has helped automate all the systems. We trade our combined capital as well as our own separate accounts.



Mr. Black,
If you don't mind, what platforms/software/brokers did you use to automate. Are all your systems automated incl ASX shares? Surely someone watches over it all fulltime?
Thanks


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## captain black (15 July 2019)

investtrader said:


> what platforms/software/brokers did you use to automate.




We use the Interactive Brokers API for futures and shares. A few local brokers like Open Markets who have an API for shares only and the CGQ API through AMP futures for futures only.

My trading partner has a background in sysadmin and server management so has written some custom tools as well. I wouldn't have been able to automate everything without his knowledge and experience.



investtrader said:


> Are all your systems automated incl ASX shares?




Yes. We have some long term strategic holdings for dividends etc. that we manage on a discretionary basis but all our systems are automated.



investtrader said:


> Surely someone watches over it all fulltime?




At least one of us needs to have access to the internet while the systems are running. We can access our servers using our Android phones if need be. It's set up to send alerts if anything out of the ordinary happens and needs to be acted on.


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## investtrader (15 July 2019)

Thanks for the detailed reply. My son's a senior software engineer .. maybe I'll have to get him onto it!!

PS Forgot to ask .. so all written in AFL?


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## captain black (15 July 2019)

investtrader said:


> Thanks for the detailed reply. My son's a senior software engineer .. maybe I'll have to get him onto it!!




I considered myself a reasonably good coder but watching a professional and how they approach problem solving has been a real eye opener.



investtrader said:


> PS Forgot to ask .. so all written in AFL?




There's still some stuff that Amibroker AFL does (composite calculations for example)  but we've been gradually moving everything over to Python. I still use Amibroker for visual stuff and the odd bit of discretionary futures trading. I figure I'd better keep up to date with Amibroker in case my mate decides he doesn't need me anymore


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## investtrader (15 July 2019)

Thanks. Do you use the composites for market timing?


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## captain black (15 July 2019)

investtrader said:


> Thanks. Do you use the composites for market timing?




Some for general market timing and some for sector analysis.

There's some more details in my share trading thread:

https://www.aussiestockforums.com/threads/captain-blacks-share-trading-thread.34791/


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## barney (15 July 2019)

Well done to all who've had a good year …. and for those that have struggled, keep on plugging!

I live in Spec land so some years are great where you eat scotch fillet …
and drink a lot of bourbon

Then some years are not so great where you eat lots of baked beans …
and drink a lot of bourbon

Lets just say baked beans were frequently on the menu this year.

My collective last 5 years however, compared to the preceding 5 years, have been pretty OK so no complaints

Next year I intend to be filthy rich ….. just like I've done every other year


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## Zaxon (15 July 2019)

barney said:


> Well done to all who've had a good year …. and for those that have struggled, keep on plugging!



Very much!  We need to hear from a range of people, not just those who did well, so that readers see that both good & poor results are a normal part of investing.


barney said:


> I live in Spec land so some years are great where you eat scotch fillet …



Spec shares are great.  Just choose the ones that go up 


barney said:


> Lets just say baked beans were frequently on the menu this year.



If you do better this year, you might get some toast to go with them.


barney said:


> Next year I intend to be filthy rich ….. just like I've done every other year



lol.  Me too.  Although I'm already slightly down this year so far.


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## captain black (15 July 2019)

Great thread @Zaxon and thanks to everyone who has contributed. There's quite a diverse range of trading and investment styles across ASF and it's been interesting to read all the different approaches and returns over the last 12 months. 

Wishing good returns for everyone over the next 12 months


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## barney (16 July 2019)

Zaxon said:


> Spec shares are great.  Just choose the ones that go up




Damn … I knew there was something I was doing wrong


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