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  1. #1
    Alvarotramn Guest

    Default Trading System Ideas

    I hope you all had a nice Xmas.

    I was wondering whether anyone could assist with a bit of guidance on mechanical systems.

    I've been trading for about a year now with mixed success based on a longer term approach. About three months ago I decided that I wasn't at all happy with my own performance regarding discipline and execution of trades etc - usual stuff! I took a few months off to work solely on the psychological side of trading. I'm very happy with my progress and feel as though I've taken a few big steps forward and I'm now ready to get my hands dirty again.

    In order to instill what I've learned at a practical level I've decided to trade a shorter timeframe so that I take more trades and get quicker exposure to the pressures and situations that I've struggled with in the past. The idea being that any psychological weaknesses will come to the fore fairly quickly and I'll be able to address them accordingly. For me, the financial results in the short term are not that important. What I'm looking to do is get through a sample size of around 30 trades without making too many trading errors.

  2. #2
    Amazonnnfki Guest


    Hi Zoso - Happiness and Prosperity to you for the coming year. It seems that you come up with a poser every year!

    Here are some Trading System Ideas for you.

    This link is a start :


    In here, Colin states that

    Market Risk is 66%
    Sector Risk is 24%
    Stock Risk is 10%

    In other words, Trade with the TREND first, SECTOR secondly, and worry about the right STOCK last.

    The rest is entry, time in the market (timeframe), and exit.

    You will need quality stocks, so the ASX 200 would be a good place to start - the Fundamentals should already be pretty good. But do not trust them - check out the debt:equity ratios etc for yourself - remember ION and SGW? I don't care who says otherwise, you need to know that the stock will be there for at least the time you will be in the market!

  3. #3
    Amazonnnsmr Guest


    In order to be able to call a system "mechanical" you must be able to trust it. In other words, stick to the plan. If the trade does not do what you expect it to do, get out fast. Why wait around just to see if you were right after all? You can not afford to play "What if ..." in trading.

    Hope this helps - just my humble opinion. Oh, one more thing ... anyone can set up an indicator - "click" and you have it. Nothing wrong with that, but if you wish to build confidence, and really get to depend on your indicators, get to know the strengths and weaknesses of them.

    I haven't met any other traders - but of the ones I've spoken to from this forum, I'd wager they are doing the research on all aspects of their trading. Honing skills, refining entry/exit, etc all the time. That's what it takes.

    I wish to earn my living through full-time trading by the end of this year - that's a huge ask, considering I placed my first trade in March 2004.

    But I tell you what, Paul, I'll make it. I give myself no option. And if I can help someone else improve along the way, so much the better.

    Cheers, and Happy New Year.

  4. #4
    Amazonnnzgh Guest


    Do I understand you correctly: You want to drive Formula 1 cars first to get used to the speed and excitement, and then revert back to go-carts once you gain experience from the F1's?

    My first lesson in trading was that I needed to crawl before I walked. I bought into one of those (now defunct!) trading programs which was designed to trade the options market. Oh boy, I learnt some good lessons really fast, and it cost me my trading capital!!!!! You need to learn how to trade normal shares first, ideally on a medium to long term basis (3-12months) before attempting to trade the weekly swings.

    I know how you feel, my current system (in development) is based on weekly data, and look like trades taking 12months to complete (albeit at 20-40% profit!). With my small trading capital and using correct money management and position sizing, I'll be lucky to have two or three positions open at any one time! Doesn't give me much to do on a daily basis does it, especially considering the $300pa data cost for software! But I've looked at trading shorter term, and the moves are just not there, especially when my brokerage equates to 6% of the trade.

    My approach will have to be the longer term one, so as to make decent returns compared to the individual trade risk. Over time, hopefully as my trading capital increases, my trading level will increase too. Then I will be able to consider upgrading from the go-kart to the F1's.



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