Well I just finished skimming through a very interesting book (encyclopedia of trading stratergies) about trading startergies. Rather intersting, somewhat encouranging but also disapointing to see the results though.
They go into extremely fine detail and how to program mathematical models etc on certain stratergies and others extremely detailed reports on the outcomes of traditional stratergies. Here is what these guys had to say:
"Many of the models described as significantly better than chance (i.e., better than what would be produced by a random entry) would likely become profitable if coupled with a better exit strategy. In Part III, it was evident that when tested with random entries, the use of a good exit could bolster profits (or cut losses) by about $1,000 per trade. This means that, with a good exit, some of the entry models that had losses of several hundred dollars could be brought into positive, profitable territory.
As mentioned above, the journey was a long one, sometimes tedious and discouraging. However, this birds-eye view revealed that a lot of potentially profitable entry models were indeed discovered. There were also a number of surprises: Despite terrible reputations and dangerous tendencies toward curve-fitting, the neural network and genetic models were the best performers when tested with data that was not used in training or evolving. Another surprise was that some of the most popular trading approaches, e.g., moving-average crossovers and oscillator-based strategies, turned out to be among the worst, with few exceptions. The results of the cycle models were also revealing: Because of their theoretical elegance, better-if not ideal-performance was expected. However, perhaps due to their popularity, poor performance was observed even though the implementation was a solid, mathematical one." If anyone wants a copy (it is a 400 page book scanned in) mailme [email protected]
I do warn you it is extremely technical so if you are not interested dont waste your time and as for it just because....You might be very disappointed
Cps..that is why buyinh with the trend has such an impact to profitabilty..as you scew the fail rate from 50/50 to basically the angle of the trend...so a steap trend is more likly to move you into the money then a flat market.
CHARACTERISTICS OF SUCCESSFUL TRADERS ? A SENSE OF HUMOR ? EMOTIONAL CONTROL ? ABILITY TO FOCUS ? ABILITY TO ORGANIZE IN CHAOS ? ADAPT TO CHANGE ? FOLLOW THE TRADING PLAN ? ALWAYS SEEKING TO IMPROVE AND LEARN ? LITTLE OR NO EGO - STRONG SELF-CONCEPT ? DON'T TAKE A LOSS PERSONALLY - NEXT ! ? DO NOT FOCUS ON MONEY ? LONG HOURS DO NOT BOTHER THEM YOUR PSYCHOLOGICAL PREPARATION WILL ULTIMATELY DETERMINE THE OUTCOME OF YOUR SUCCESS OR FAILURE AS A TRADER OR AGGRESSIVE INVESTOR.