Dump it Here

[Skate]

Oh I wasn't arguing - I used the word "interesting" for a reason. I genuinely wanted to know why. Workload can be a b!itch.

Fair enough, I appreciate the clarification.

@over9k, your overtones had no connotations what so ever, expressed or implied. When posters have a perceived history of strongly debating a point I try to use some gentle phrasing or keywords hoping they feel a different atmosphere when reading or posting in the "Dump it here" thread. I'm proud to say the "Dump it here" thread is different to most.

Friendly atmosphere
Over time you value some posters more than others, some have the knack of nailing posts accurately, succinctly & politely. Those posts are the ones everyone enjoys reading. Whether your view is right or wrong isn't important, what's important is that this thread gives you the opportunity to express your views without being "ridiculed or challenged". However, some members tend to follow patterns of behaviour when posting. This pattern can incite an emotional response that tends to undermine the friendliness of this educational thread.

Offending a member is hard to detect
I'm trusting my explanation is not perceived as a reflection on you but rather it serves a greater value "as a friendly reminder to others".

Skate.

 

[over9k]

So have you considered moving to a more frequent system on account of the significantly larger gains that others, for example, qldfrog, have been able to accrue by doing so?

I.e do you think the extra effort/work might be worth moving to a more frequent/higher volume system?

 

[tech/a]

For those that prefer the science over the faith (or combination thereof), knowing the why and how, I believe can assist with mitigating the emotional bias.

Systems are simply a set of Trading conditions tested against a universe in a repetitive manner with conditions like "If" "When" "Then" "Or"
They have very limited ability to adapt to both long and short term market conditions.

**If you trade enough systems you'll notice (as I did) that most work really well in Bull Markets
With Mixed results in flat markets and atrociously in Bear markets.

Unless you have a way of adapting to market conditions or the ability to predict a longer term move you'll forever be trapped.
For 95% of systems the Why and How is right here**!

 

[Skate]

So have you considered moving to a more frequent system on account of the significantly larger gains that others, for example, qldfrog, have been able to accrue by doing so? I.e do you think the extra effort/work might be worth moving to a more frequent/higher volume system?

"Do you think the extra effort/work might be worth moving to a more frequent/higher volume system?"
@over9k, it's not about the extra work involved, it's more about the results from my research. In a nutshell, my research reflects that trading with greater frequency doesn't enjoy the gains @qldfrog has expressed. Having an interest in this field I would appreciate a follow-up post of "how you would go about achieving this" for others to better understand.

They never tell you
When you are new to trading you will often hear this: "Buy low & Sell high" but they "never tell you how" to do it. I go into great detail explaining the virtues of how to "Buy high to Sell higher" that's the difference between a useless comment & reading the "Dump it here" thread.

Skate.

 

[Skate]

Unless you have a way of adapting to market conditions or the ability to predict a longer term move you'll forever be trapped.

@tech/a, welcome back to posting in the "Dump it here" thread, it's been quiet a hiatus. Recently we have been discussing the virtues of a "Sentiment Filter" overusing an "Index Filter"
to time the period, we should be in the markets. Most traders declare that timing the markets can’t be done but as a trader that's a function of our job description.

Skate.

 

[over9k]

Well if you're trading frequently then you're simply trading volatility. Fundamentally, that's what you're working with.

So you find a sector or industry that's on at least a slow (or moderate) increase as of now, and you trade the chop. I'm having a good discussion with ducati in the other thread about what is relevant/causing the chop, but a simple example at the moment which I think is very relevant (and he does not) is virus data. Every time there's a spike in virus data, some sectors nosedive and some spike.

So travel in australia for example is going to improve significantly and soon. In the united states it is not, and the reason is actually very simple: Australia contained the virus, usa didn't. It's genuinely no more complex than that.

The market knew (and knows) this, hence travel related stocks were on a fairly solid trend upwards. Then we got virus spikes after the protests, particularly in victoria. So things nosedived yesterday. Same as last week and in fact in several instances over the past fortnight, and there was then a commensurate spike the following day, or last friday, it was literally just by the afternoon. All this is doing is simply delaying what WILL occur - not stopping it from happening.

I can't predict exactly when the bad virus data will come out, just that we'll get some, so I don't sell the peaks but rather, buy the drops. My position increases over time as I was fully expecting a lot of chop after the george floyd riots so deliberately kept a significant amount of cash out of the travel related stuff but primed ready to buy in whenever we got some nasty virus data. In other words, you can't perfectly predict when the virus data will come out, but you can predict that it WILL occur (I'm finding it to be about 2-3 weeks after the actual date of infection just FYI) and that there's a huge drop IMMEDIATELY after it does.

When there's a 4% swing just between morning & afternoon, there's an absolute killing to be made here.

The other thing I do is buy into a sector/industry, not by companies - I'll buy all the biggest players and then trim my position down by nuking the lowest performers as some companies are hit far harder than others in response to bad data because the difference is that they aren't then seeing a commensurate spike afterwards. In other words, there's generally a trend split between the two (or three or four or five or whatever). Alternatively, the gains just aren't as high as their competitor - either way, the lowest performer(s) go.

I sold five positions off last week and pumped the money into their competitors after doing absolutely *no* research into why they weren't performing as well as the others and only one out of those five has even matched their competitors (which I pumped the money from the sale into) since. A simple example of this is microchips - intel & AMD are both flat for the past couple of months, but skyworks is through the roof. Same with slack vs zoom.



Using this method, I've found that if you get the sector/industry right, you don't need to worry too much about getting the company right - you'll potentially lose a few gains/cough up more in fees initially, but the risk and work required to get it right is just SO much lower that it's well worth it.

 

[WilsonFisk]

For 95% of systems the Why and How is right here**!

Absolutely!

• don't just have 1 string in your Bow
• don't just have 1 Bow
• Know when to use which Bow
• Know when not to use which Bow (or in some circumstances any Bow)

I don't necessarily have a trading system that will adapt well to both short and long term conditions, but I am utilising a Trading System (hopefully systems - soon) to leverage long term conditions, and when short term conditions don't suit the system, I deploy the capital to other effective pursuits.

In regards to Timing the Market, I believe that it is difficult to do.

In regards to timing a trade, I believe it is the function of a trader to discern this whether they are fundamental or systems/technical based.

Individual Stocks and Even Sectors can perform very differently to the Market as a Whole. I think this is something that @ducati916 mentioned/alluded to/discussed something earlier in the thread as a sector being a more effective tool.

 

[over9k]

Wilson - reference timing, outside of the USA there has been a big dip every single time bad virus data has been released. Every time.

With that in mind, if you know that there's going to be a big spike in virus cases in say, 2-3 weeks (which is what I've found to be the rough gap between actual infection and it showing up in the data), which there was always going to be after all the infection spread in the riots/protests, then you can put a lowball good-til-cancelled order in *now* and it'll just autofill as soon as the market tanks in response to the data release - there's no need to sit there watching the news like a hawk trying to time it as it'll just autofill for you as soon as the drop happens.

 

[Skate]

In regards to timing a trade, I believe it is the function of a trader to discern this whether they are fundamental or systems/technical based.

I'm amazed
@WilsonFisk it may have taken you a while to make your first post but it's evident you have some quality posts in you, sharing information with others is priceless. You might have to change your avatar to: "No Longer Lurking From The Deep"

Skate.

 

[over9k]

I absolutely agree, specifically with your statement about knowing when to NOT do something.

Kind of like how some of the best decisions I've ever made in poker were folds, some of the best things I've ever gotten right trading were NOT buying particular positions.

 

[qldfrog]

@Skate, i doubt i am a role model, even less a model but will try to compare both daily and system results for you when i am back on my computer will have to wait next week
I have 2 systems relatively similar one weekly one daily
Will show the hard results till i liquidated them before that trip.
A key factor is that they work with volatility so daily is able to edge it more than weekly..so in my opinion the difference in success
And btw, my definition of stellar results is probably soso for you..i am just the apprentice

 

[Newt]

Thanks for sharing this info QF. It makes sense that daily system might be able to navigate the volatility of the markets more reliably in recent weeks. Still happy to stay weekly myself, and agree the learning never ends. Even just staying in the game and retaining "apprentice" status beats being knocked out.

 

[Skate]

will try to compare both daily and system results for you when i am back on my computer will have to wait next week. I have 2 systems relatively similar one weekly one daily. Will show the hard results till i liquidated them before that trip. A key factor is that they work with volatility so daily is able to edge it more than weekly..so in my opinion the difference in success

Thanks for sharing this info QF. It makes sense that daily system might be able to navigate the volatility of the markets more reliably in recent weeks. Still happy to stay weekly myself, and agree the learning never ends. Even just staying in the game and retaining "apprentice" status beats being knocked out.

Daily versus weekly trading Strategy
In the meantime, while we wait for @qldfrog to show his results next week I thought it might be helpful to display my research on the subject of "trading a Weekly Strategy versus trading a Daily Strategy". Comparing backtests would normally be a "contentious issue" where members are likely to argue about the issue (but not in this thread).

The "Dump it here" thread
Allows members to freely express a view or an alternative opinion (as well as backtest results of course) without being challenged or ridiculed, otherwise, it would undermine the friendliness of the “Dump it here” thread.

Weekly beats Daily in every time frame (except one)
To keep the research as basic as possible I have coded the "Bollinger Bands Strategy" (recently uploaded) as a "Daily Strategy" & a "Weekly Strategy". Both have been backtested against each other over the same period. The parameter settings have been changed to reflect the periodicity being backtested, giving each a fair go.

#1. Bollinger Weekly Strategy versus Bollinger Daily Strategy Backtest Results - 2019 Full Calander year (Winner = Weekly)






#2. Bollinger Weekly Strategy versus Bollinger Daily Strategy Backtest Results - "1st January 2019 to 24th June 2020" (Winner = Weekly)






#3. Bollinger Weekly Strategy versus Bollinger Daily Strategy Backtest Results - "1st July 2019 to 24th June 2020" YTD (Winner = Weekly)






#4. Bollinger Weekly Strategy versus Bollinger Daily Strategy Backtest Results - "1st January 2020 to 24th June 2020" COVID-19 CRASH (Winner = Daily slightly)



Weekly versus a Daily system
There are merits trading in both time frames but for "me" I prefer trading a weekly system, it also reduces the workload & stress.

Summary
When the Daily needed to step up & act quickly to exit on volatility during the recent COVID-19 Crash it fell short of my expectations. More work & extra commission is all you get when trading a daily strategy versus a weekly.

Skate.

 

[frugal.rock]

Hi Skate,
I have been thinking.... the thread is colossal !
In fact, it's getting bigger than Ben Hur.
Was wondering and hoping if any consideration to splitting it up somewhat and somehow has occurred.
I seem to have troubles with the site search engine. I searched "oil" the other day, had the thread box ticked, and got the following result,

Unfortunately, Oil Drip user wasn't what I wanted ! I don't think my WiFi signal was the problem, on this occasion...
F.Rock

 

[Skate]

Hi Skate, I have been thinking.... the thread is colossal ! In fact, it's getting bigger than Ben Hur.
Was wondering and hoping if any consideration to splitting it up somewhat and somehow has occurred. I seem to have troubles with the site search engine. I searched "oil" the other day, had the thread box ticked, and got the following result, Unfortunately, Oil Drip user wasn't what I wanted ! I don't think my WiFi signal was the problem, on this occasion...F.Rock

@frugal.rock this has been suggested before a few times. I prefer to keep all my posts together as it's an educational help thread (in the beginner's section). Also along the way for those who have had trouble re-finding information, there have been helpful hints how to bookmark & how to do keyword searching. If you are experiencing difficulties with the search feature not displaying the correct results I suggest you let @Joe Blow know as others may be experiencing the same issue.

Skate.

 

[Newt]

Summary
When the Daily needed to step up & act quickly to exit on volatility during the recent COVID-19 Crash it fell short of my expectations. More work & extra commission is all you get when trading a daily strategy versus a weekly.

Skate.

Hallelujah say all we Weekly traders to that info then Skate! Thanks for showing the backtests. You'd be aware Peter2 has also previously compared and contrasted daily and weekly discretionary trading, noting that daily doesn't always "earn its keep". Let's hope the algos and market forces continue to leave a (weekly) niche for the amateurs for many years to come...

 

[over9k]

Day traders haven't been able to consistently make money over short time frames for ages. Basically all of it is algorithms now.

These are NOT normal market conditions at the moment however - don't go getting yourselves black swanned like the black-scholes guys did in the 90's.

 

[over9k]

Oh and the open tonight has been a big drop in response to the IMF news but the tech heavy nasdaq is a very different number (4-5x the difference between the indexes) to the sp500 & DJ as tech's actually up whilst everything else is down:



Let me emphasise that tech and stay-at-home tech are not the same things however. It's the stay-at-home tech that's where to be.

I'm kind of tempted to make a gut-instinct "stay at home tech index" and just see how it does. Would you mind if I added that to this thread skate?

(and would anyone be interested in it?)

 

[Skate]

Oh and the open tonight has been a big drop in response to the IMF news but the tech heavy nasdaq is a very different number (4-5x the difference between the indexes) to the sp500 & DJ as tech's actually up whilst everything else is down:



Let me emphasise that tech and stay-at-home tech are not the same things however. It's the stay-at-home tech that's where to be. I'm kind of tempted to make a gut-instinct "stay at home tech index" and just see how it does. Would you mind if I added that to this thread skate?

@over9k this is an educational thread & if you think posting that information will help, I’m all ears.

Skate.

 

[over9k]

True, it's just not a trading method and this thread is all about methods, so I didn't want to get it off-topic.