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ASX

Its a balance.

Your not going to get rid of drawdown you'll only keep it within acceptable limits.Then there is the possiblilty that your system and mine will trade in market conditions not seen in testing.

It is possible that the system will outperform in conditions more favourable and underperform ---even fail if unfavorable.

Its the length (Time and number) and depth of these which determines the maximum drawdown and in the end un acceptable drawdown.

Limiting depth and number (consective) is the only way--I-- know to deminish it.

Thats one of the reasons I exited all long portfolio positions in 3 longterm portfolio's at 6170 XJO. This wasnt part of the system conditions!!!

In a well performing portfolio the death by slow bleeding doesnt occur.

Testing has shown in a positive expectancy system that strings of losses and initial risk wont wipe it our.

Below is the current portfolio for the test portfolio of Tech Trader.

The "Initial stop in all cases is 10% of the initial purchase price.

[ATTACH=full]74425[/ATTACH]

Note stocks like QBE.

Initial stop or 1R 79c so far we have approx 25R in that one trade. Maximum string of losses was from memory 9 for the system.

I personally dont believe the answer or more to the point finessing relative to drawdowns--- is at this end (The buy end) of a system.