It's simple tech, and it's similar to how mech traders think they can gaurantee performance and then "discretionarily" discontinue their system if conditions become unfavourable. (You realise you become hoisted by your own petard, with statements like this, yes?)
Wayne --you and many others seem to be missing the point and thats the point which gives the mechanical trader the confidence to trade what most consider larger accounts,Borrow and leverage,trade their own SMF.I'll make that point again.
They have a BLUEPRINT that if they trade within its parameters guarentee profit.
Stopping trading the method then
ISNT a discretionary decision its a business decision and is quantified.
Stopping outside the rules/numbers of your method could be a discretionary decision,for any reason--liquidating capital for another purpose is perhaps one.But thats not an intrugal part of the reason a mechanical/systems trading method is more consistant and reliable than disc trading methods.
It's called expectancy and I believe you are well aquainted with the concept... just used a slightly different way.
Im interested in the Different way?
I you and anyone who trades in a disc way can come up with any set of conditions and variables apply it to some charts and discover a Positive Expectancy.Problem is after 100 charts or 1000 charts that positive expectancy can be ruin.A mechanical/systems trader has a much better idea after testing millions of trades wether that positive expectancy is genuine.For Duc even what we do is not enough!
To be quite honest, I don't know why I bite when someone says T/a is nonsense, disc trading is nonsense, this is nonsense, that is nonsense.
Frankly I dont mind good discussion on any topic,I think what annoys you and me is material presented WITHOUT varifiable substance.If I post anything on these topics I generally have something that can prove my arguement,or at least add to the discussion by example.If others do this rather than make "hypothetical,this is what I believe without any practically applied Basis"
Then we can all learn from the practical examples/arguements presented.
There is far to much,this SHOULD work,COULD work,WOULD work IF ONLY,type of theoretical discussion on BB's.
Whats wrong with THIS DOES work and here it is .
When someone starts on this I'm just going to turn off because it's unmitigated BS. Pure ego talk.
Dont know where you get the ego inference from,I certaintly completely believe that these discussions and my input are varifyable,honest proven trading methodology.Its success has been fantastic and as its the only live varifyable method available for discussion to which I refer to and countless others use as a bench mark----everytime I refer to it I'm LABELLED EOGOTISTICAL.--thats the purist of B/S. Duc honestly believes his theories and is constantly testing/discussing them I dont think his posts are ego driven when instigated---a bit jumps in during discussion--but all in all think they are adding to ASF.
The are a hundred ways to skin the market cat and all work, if the practitioner knows how... same as any business.
This is where we do differ.
You are dead right---however most small business and novice traders dont work with numbers.Most small busineses wouldnt know a Quick Ratio from a positive expectancy calculation.Most small businesses fail or underperform,so do most traders.I've been in business 30 yrs and when I understood the "NUMBERS" of business It doubled for many years and now has positive growth most years.I've been trading 12 yrs--same here.
So I pass it on with varifyable discussion NOT THEORY.
People can trade as they wish if they can see the merit in my work fine,if not fine as well.
Crackaton
Think youre snaffled.
While you can claim forward paid tax as a deduction you still have to pay the tax on $$s earned.So if you use the money you may not be able to pay the tax.
On Margin calls.
You can liquidate some of your stock holdings to honor a call.Dont have to sell all.Once you get up and running a call should be rare as hens teeth as your profits will keep you well within terms.Of course you can re invest profits (I Do).
Bulldust
Thanks for the patronising,and another quality post adding depth to the discussion.
Rosella has touched on the way I use Equity loans and margin.
You can have the best of both worlds with minimal risk and piece of mind.
But hey I wont go into how I use them as it would only be seen as egotistical.
Particularly if I talk about 3 methods, 3 equity loans and 9 securities.
Retirement doesnt guarantee Business Savvy,just as a knowledge of Fundamental company analysis doesnt guarantee successful investment.