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[USER=78961]@Warr87[/USER] you have touched on a really import subject about diversification & I'll throw in Correlation of strategies as well.

Lets talk about diversification
We will forget about the REFLEX strategy it doesn't deserve another breath. Diversification lessons risk, by trading strategy that are not correlated. Diversification comes in many forms but I'm going to concentrate on Diversification of strategies. Unfortunately sometimes trading any 'trend following systems' there is normally a degree of correlation with the signals, the index being traded usually is reflective of the prevailing market conditions. Meaning: All 'Trend Following Systems' naturally jump on & join trends (the momentum), that's the very nature of the beast. Following trends is one of the simplest form of trading there has ever been & they have a proven track record of making money over time. I for one, can confirm "following trends" has been kind to me. I have 3 diversify strategies that I trade (really there are 4) & thankfully work well together without correlation.

Lets talk about correlation
In my early days of trading I was trading 6 strategies, all profitably but highly correlated holding many multi tens of thousands of dollars in the same position (in reflection it was crazy) with a series of highly correlated systems you tend to get the same signals just weeks apart. It was the captain's idea after explaining the problem of high correlation trading 6 trend following strategies, he simply said combine the 3 best strategies into one & write the code so only the first signal is taken, discarding the others. The HYBRID Strategy was born (a combination of 3 of my best strategies) packaged into one master strategy. The CAM & PANDA Strategies have none to little correlated to my Hybrid strategy or correlation to each other. I'm so lucky to have strategies not correlated as it allows me to trade a large account.

Discretionary trader
I've recently posted in [USER=13908]@peter2[/USER] "p2-starts-another-asx-portfolio-wkly-dly" thread that manually sorting through charts looking for the perfect entry & missing the setup it would be excruciating & lead to being excessively hard on myself - being less than professional would be a hard cross to carry. In saying this it's must be frustrating for a discretionary trader seeing the good moves in hindsight, oblivious to the setups in the 'heat of the battle' whilst trading. Some forum members are gifted, possessing the unique ability to see setups without really looking but if you are more like me you'll fall short in this area. Why do I trade Mechanical systems? - because it suits my temperament.

Skate.

<blockquote data-quote="Skate" data-source="post: 1052798" data-attributes="member: 57364">[USER=78961]@Warr87[/USER] you have touched on a really import subject about diversification &amp; I&#039;ll throw in Correlation of strategies as well.Lets talk about diversificationWe will forget about the REFLEX strategy it doesn&#039;t deserve another breath. Diversification lessons risk, by trading strategy that are not correlated. Diversification comes in many forms but I&#039;m going to concentrate on Diversification of strategies. Unfortunately sometimes trading any &#039;trend following systems&#039; there is normally a degree of correlation with the signals, the index being traded usually is reflective of the prevailing market conditions. Meaning: All &#039;Trend Following Systems&#039; naturally jump on &amp; join trends (the momentum), that&#039;s the very nature of the beast. Following trends is one of the simplest form of trading there has ever been &amp; they have a proven track record of making money over time. I for one, can confirm &quot;following trends&quot; has been kind to me. I have 3 diversify strategies that I trade (really there are 4) &amp; thankfully work well together without correlation.Lets talk about correlation In my early days of trading I was trading 6 strategies, all profitably but highly correlated holding many multi tens of thousands of dollars in the same position (in reflection it was crazy) with a series of highly correlated systems you tend to get the same signals just weeks apart. It was the captain&#039;s idea after explaining the problem of high correlation trading 6 trend following strategies, he simply said combine the 3 best strategies into one &amp; write the code so only the first signal is taken, discarding the others. The HYBRID Strategy was born (a combination of 3 of my best strategies) packaged into one master strategy. The CAM &amp; PANDA Strategies have none to little correlated to my Hybrid strategy or correlation to each other. I&#039;m so lucky to have&nbsp; strategies not correlated as it allows me to trade a large account.Discretionary traderI&#039;ve recently posted in [USER=13908]@peter2[/USER] &quot;p2-starts-another-asx-portfolio-wkly-dly&quot; thread that manually sorting through charts looking for the perfect entry &amp; missing the setup it would be excruciating &amp; lead to being excessively hard on myself - being less than professional would be a hard cross to carry. In saying this it&#039;s must be frustrating for a discretionary trader seeing the good moves in hindsight, oblivious to the setups in the &#039;heat of the battle&#039; whilst trading. Some forum members are gifted, possessing the unique ability to see setups without really looking but if you are more like me you&#039;ll fall short in this area. Why do I trade Mechanical systems? - because it suits my temperament.Skate.</blockquote>

[QUOTE="Skate, post: 1052798, member: 57364"] [USER=78961]@Warr87[/USER] you have touched on a really import subject about diversification & I'll throw in Correlation of strategies as well. [B]Lets talk about diversification[/B] We will forget about the REFLEX strategy it doesn't deserve another breath. Diversification lessons risk, by trading strategy that are not correlated. Diversification comes in many forms but I'm going to concentrate on Diversification of strategies. Unfortunately sometimes trading any 'trend following systems' there is normally a degree of correlation with the signals, the index being traded usually is reflective of the prevailing market conditions. Meaning: All 'Trend Following Systems' naturally jump on & join trends (the momentum), that's the very nature of the beast. Following trends is one of the simplest form of trading there has ever been & they have a proven track record of making money over time. I for one, can confirm "following trends" has been kind to me. I have 3 diversify strategies that I trade (really there are 4) & thankfully work well together without correlation. [B]Lets talk about correlation [/B] In my early days of trading I was trading 6 strategies, all profitably but highly correlated holding many multi tens of thousands of dollars in the same position (in reflection it was crazy) with a series of highly correlated systems you tend to get the same signals just weeks apart. It was the captain's idea after explaining the problem of high correlation trading 6 trend following strategies, he simply said combine the 3 best strategies into one & write the code so only the first signal is taken, discarding the others. The HYBRID Strategy was born (a combination of 3 of my best strategies) packaged into one master strategy. The CAM & PANDA Strategies have none to little correlated to my Hybrid strategy or correlation to each other. I'm so lucky to have strategies not correlated as it allows me to trade a large account. [B]Discretionary trader[/B] I've recently posted in [USER=13908]@peter2[/USER] "p2-starts-another-asx-portfolio-wkly-dly" thread that manually sorting through charts looking for the perfect entry & missing the setup it would be excruciating & lead to being excessively hard on myself - being less than professional would be a hard cross to carry. In saying this it's must be frustrating for a discretionary trader seeing the good moves in hindsight, oblivious to the setups in the 'heat of the battle' whilst trading. Some forum members are gifted, possessing the unique ability to see setups without really looking but if you are more like me you'll fall short in this area. Why do I trade Mechanical systems? - because it suits my temperament. Skate. [/QUOTE]

Verification