Sunday, August 28, 2016

A reality check - looking at drawdowns

Quite often I meet or correspond with people who seem to think that they can pull a certain amount out of the market on a regular basis. This is impossible - particularly when using a trend following method. 

Depending on your timeframe and parameters, you can easily go weeks, months or even years before new equity highs are made. Therefore, you will actually spend the majority of your time stuck in a drawdown. 

For a lot of people who may be attracted to the potential overall returns of a method, the reality of what you have to go through in terms of drawdowns (both in monetary and time terms) to achieve those returns can be difficult to accept.

Saturday, August 20, 2016

What you can learn from Mark McCormack

Mark McCormack and Arnold Palmer

Mark H McCormack was a business pioneer. He created the International Management Group in the early 1960's - his first client was Arnold Palmer, closely followed by Jack Nicklaus and Gary Player.

Friday, August 12, 2016

Trading in the Zone - and some recent setups

While away for a recent holiday my reading material consisted of two classics by Mark Douglas - The Disciplined Trader and Trading in the Zone. For many Trading in the Zone this is the book that brought trading psychology to the masses.