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Better System Trader

If you’re looking for inspiration, motivation and practical advice on improving your trading results, Better System Trader delivers every week. Each episode brings you an expert trader who shares their own story, along with the steps, both good and bad, that they’ve taken on their path to success. With a focus on actionable insights, the tips and tricks used by the experts contain loads of value, providing you with insanely practical tips and tools you can start using TODAY. Improve your trading with Better System Trader.
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Now displaying: 2015
Dec 27, 2015

In this episode we’re discussing the results of a quantitative study on stop losses completed by Cesar Alvarez of Alvarez Quant Trading. Cesar was also a guest of the show way back in Episode 3.

Cesar was director of research for Connors Research for almost 9 years, developing quantitative trading models for individuals, prop traders and hedge funds.

In this episode he’s going to share the results of a quantitative study on stop losses, also testing out some common pieces of trading advice to see if they're actually true.

Stops can have such a huge impact on trading results so I'm sure traders of all levels will find this research invaluable.

 

We will be discussing backtesting results and some charts. We'll be explaining them for those who are listening along but if you’d also like to see the results while we discuss them, you can download a copy or even watch as a video in the show notes page at bettersystemtrader.com/37.

I hope you enjoy Cesars discussion of ‘Stops - the Good, the Bad and the Ugly’.

In this episode we discuss

  • Different types of stops, their application and performance results
  • Percentage vs Volatility based stops
  • Intraday vs End of Day stops
  • Trailing stops vs Targets
  • Some common trading statements that are often assumed to be true and the results of testing them - do they hold up?
  • The levels of Stop knowledge, which level are you at?
Dec 13, 2015

Creating robust trading strategies can be a difficult task, sometimes taking months or even years to generate something you find acceptable. Even then, once you start trading it live there is no guarantee it’ll work in the future.

With strategy creation being such an involved process at times, how would you like it if you could just tell the computer the results you wanted and let it figure out the trading rules? Is it actually possible to create robust trading strategies that way?

In this episode Michael Bryant from Adaptrade talks to us about automatic code generation, methods to exploit trade dependency and techniques to trade the equity curve.

Michael has been trading the markets since 1994, providing trading systems for the futures markets and even managing money as a CTA.

He is founder of Adaptrade, a company which provides innovative software tools for individual and professional traders.

In this episode we discuss

  • The traditional approach to creating trading systems and issues caused by this approach
  • Potential areas of improvement in traditional approaches to system development
  • Evolution of the strategy creation process
  • Genetic programming and optimisation and it’s use in trading strategy creation
  • The advantages of automatic code generation
  • Measuring and reducing over-fitting when using genetic optimisation techniques
  • Addressing concerns with removing human logic from the strategy development process
  • Degrees of freedom and the impact if can have on strategy results
  • Trade dependency, how to detect it and methods to exploit it
  • Trading the equity curve based on trade dependency and trading style
  • Which stage of the strategy creation process to include position sizing
  • Common position sizing mistakes traders make
Nov 29, 2015

Andrew Gibbs has been involved in the financial markets since 2001 and is the founder and CEO of Halifax New Zealand.

Andrew has extensive experience in all forms of equity and derivative contracts, managing millions of dollars and trading a number of markets around the world.

In this episode we discuss volatility and methods to trading the VIX plus the benefits and methods of including fundamental data in technical quant models.

Topics discussed

  • Instruments you can use to trade volatility and the benefits or disadvantages of each
  • What makes the VIX attractive to trade and why it often trends over time
  • The types of trading styles that suit the VIX
  • The dangers of trading volatility products
  • Seasonality in the VIX
  • How to get started building volatility trading models
  • Fundamental data and the types of fundamental datasets that work well in quantitative models
  • Why some fundamentals work better than others
  • The frequency of fundamental data release and how that dictates trading model style
  • How to account for revisions to data
  • The impact of including fundamental data can have on trading results
  • Technical vs Fundamental data and which tends to be more robust
  • Issues with fundamental data and company reporting accuracy
  • How to reduce the chances of investing in a company that is likely to go bust
  • Combining fundamentals and technical data and how to test
  • How to get started building fundamental quant models
Nov 22, 2015

Jay Kaeppel has over 25 years experience in the financial markets.

He has worked as the Head Trader for a CTA and published a number of popular trading books on Futures, Options and Stock Market Seasonality.

He also spent a number of years writing a weekly column titled “Kaeppel’s Corner” and publishes on his blog “Jay On The Markets”.

He is now Portfolio Manager for Alpha Investment Management, offering strategies such as the ‘Alpha Multi-Income Strategy’ to investors.

In this episode we discuss a number of seasonal tendencies, how they can be integrated into a trading model, the applications of the Known Trend Index and the reasons why most traders fail.

Topics discussed

  • The Santa Claus rally - what it is and how to trade it
  • How to use seasonality to complement other models
  • Seasonality tendencies around holidays
  • Monthly seasonal tendencies and a simple monthly seasonal system that vastly outperforms stock index returns
  • Boiling down the trading process into 4 simple words
  • Using leveraged ETFs for seasonality trades
  • The worst performing month of the year (it’s not October)
  • Converting seasonal tendencies into a trading model
  • A simple seasonal sector system that takes only 6 trades per year
  • Diversification vs Specialisation and the impact it can have on trading and drawdowns
  • Are seasonal trading strategies just data mining?
  • The Known Trends Index (KTI) and how it can be used in trading
  • Why most traders fail
Nov 8, 2015

Laurent Bernut was a systematic short seller with Fidelity for 8 years. His mandate was to underperform the longest bear market in modern history: Japanese equities.

Prior to that, he worked in the Hedge Fund world for 5 years.

He now runs an automated Forex strategy and travels the world with his family.

In this episode we talk all about Short selling, creating shorting strategies, the challenges of implementation and how to manage risk. We also discuss the importance of exits, insights into Bear markets, autotrading Forex and why complexity is a form of laziness.

Topics discussed

  • The benefits of developing a strategy on the short side first and why long/short symmetry is important
  • Challenges with executing short systems and solutions
  • The most important aspect to worry about when short selling
  • Finding short candidates in a Bull market and why you should ignore absolute performance
  • Tips to creating profitable short strategies
  • The importance of exits and how to test them
  • Insights into Bear markets
  • The 3 wrong questions to ask during a Bear market and the 3 best ones to ask
  • A simple method to identifying Bull and Bear markets
  • Why complexity is a form of laziness
  • Using MT4 as a professional trading platform
  • Why being disciplined is a myth
  • The type of strategies that work in the Forex markets
  • The Common sense Ratio and why it’s more robust than the Sharpe ratio
Nov 7, 2015

Thomas Stridsman has over 20 years experience in the financial markets.

He was an editor for Futures magazine and published two books on trading system development and money management.

He is now a fund manager at Alfakraft, specialising in short-term trend following strategies with a focus on dynamic size allocation and risk distribution algorithms.

In this episode we discuss strategy testing, why you need to normalise metrics, tips to creating robust strategies and why he doesn't test entries and exits any more (and what to focus on instead).

Topics discussed

  • The differences between short term trend following and long term trend following
  • Why backtesting metrics should be normalised to give an accurate picture of performance
  • Why you should look to restrict the number of consecutive winners and losers
  • The difference between a good model and a profitable one
  • Tips to creating robust systems
  • Trading costs and when to include them in testing
  • Using standard deviation to determine system robustness
  • How his systems development approach has changed over the years
  • The one particular insight that propelled his trading forward
  • Applying Optimalf to position sizing
  • The future of trading
Oct 31, 2015

Greg Morris was Sr. Vice President, Chief Technical Analyst, and Chairman of the Investment Committee for Stadion Money Management, overseeing the management of over $5.5 billion in assets. 

He has been featured in the media a number of times, being invited to lecture about technical market analysis around the world.

He is currently semi-retired, serving as a consultant and working on a few projects, including golf.

In this episode we talk about the real definition of risk and how to manage it, the applications of market breadth and how the 'Weight of the evidence' concept can be used in trading.

Topics discussed

  • Why defining risk as volatility isn't accurate and what risk really is
  • Can diversification actually be used to minimise risk?
  • Why Rebalancing doesn't make sense
  • The ‘Weight of the evidence’ concept and how it can be used in trading
  • Why it’s important to test indicators over non-standard ranges
  • What market breadth measures can reveal in market tops
  • Different types of breadth and their applications in Trend Following
  • Selecting indicators and why diversification of indicators is vital
  • How often should you tweak your model if something isn't working so well
  • The current state of the market

 

Oct 25, 2015

A couple of weeks ago I went back through all the guests we've had on the show so far and realised how very fortunate we've been to have so many fantastic guests on the show, sharing their knowledge and experience, some of them with more than 50 years of trading experience!

To be honest, I’d actually forgotten some of the topics we’d covered so far and going back through them was an excellent reminder of all the valuable information the guests had shared, so for Episode 30 I thought it might be a good idea to revisit some of the highlights from the earlier episodes so that those that haven’t heard them will go and listen to them, and those who have already listened may get some value out of hearing the highlights again.

I know when I went back through them it reminded me of some things that I wanted to test or investigate further, and I really found it a valuable exercise so I hope you do too.

This episode will cover some of the highlights from episodes 1 to 20; some of my favourites and some of yours.

Topics discussed

  • How to find new trading ideas every day
  • Using optimisation to understand market behaviour, not to find the optimal parameters
  • How the level of market noise can indicate the type of strategy to trade
  • Tips to creating robust models
  • Avoiding over-optimised trading strategies
  • Combining multiple conditions or strategies into an ensemble system
  • Why simple systems are better than complex ones
  • How market timing can improve strategy performance
  • The concept of conditional trading and why you need to consider market context
  • Testing the effectiveness of entry and exit rules
  • The type of strategies that should have stops and when stops don't make sense
  • Factors to consider when choosing a position sizing strategy
  • How dual momentum can produce profits and protect in a downturn
  • Trading the equity curve to protect capital
  • Why traders should focus on process and not outcome
Oct 18, 2015

Alan Clement is a Certified Financial Technician, full time independent trader, quantitative trading systems designer and private investment consultant.

He is also a councillor with the Australian Technical Analysts Association and contributes to the technical analysis articles for Fairfax press.

In this episode we talk about Rotational trading systems, the impact of stops on results and alternatives to managing risk. Alan also shares some interesting tips into measuring system health, dynamic position sizing and anticipating trading signals.

Topics discussed

  • Rotational trading - entries, exits and managing risk
  • Methods to measure momentum in trend following strategies
  • The impact of stop losses in trading systems and alternatives to managing risk
  • Tips to position sizing without a stop loss
  • Using dynamic profit targets to reduce risk and increase return
  • Why drawdown is not a single number
  • Using Monte Carlo analysis as a dynamic position sizing tool
  • Methods to determining current system health
  • Factors to consider when creating a system health metric
  • Choosing the right Backtesting metrics and using them in live trading
  • Five factors to consider when choosing a strategy to suit your personality
  • Anticipating trading signals, the benefits, challenges and solutions
  • How to anticipate trading signals without reverse-engineering indicators
Oct 11, 2015

David Aronson is a pioneer in machine learning and nonlinear trading system development and signal boosting/filtering.

He is author of “Evidence Based Technical Analysis” and his most recent book "Statistically Sound Machine Learning for Algorithmic Trading of Financial Instruments" is an in-depth look at developing predictive-model-based trading systems.

He was also an adjunct professor of finance, regularly teaching MBA and financial engineering students a graduate-level course in technical analysis, data mining and predictive analytics.

In this episode David shares research into the effectiveness of indicators to identify Bull and Bear markets; he’s tested a large number of indicators and combinations with some interesting results! We also discuss issues with data mining, conditions where traditional methods of measuring data mining levels can be problematic and then finish up with the future state of Technical Analysis.

Topics discussed

  • What the popular Golden and Death Cross can tell us about the probability of a Bull or Bear market
  • Using the RSI indicator to determine market state
  • Methods to reduce the lag the 50/200 Moving Average crossover experiences
  • Using ADX and Price Variance to identify Bull and Bear markets
  • Creating indicators based on the value of other indicators
  • Modifying the McClelland Summation Index indicator to identify market states
  • How datamining increases the chance of good luck in the results
  • Why the White's Reality Check and Monte Carlo Permutation methods breakdown using certain data-mining approaches
  • How the role of Technical Analysis could change over the next 10 years
  • New developments in Machine Learning which may see the end of the role of technicians
Oct 3, 2015

Dr. Gary Dayton has been an active trader since 1999 and is President of a consulting firm that specializes in developing “peak” performance in traders.

His approach to trading psychology is very different to the traditional approaches used by other trading coaches, introducing traders to the practise of mindfulness to not only overcome fear and other unwanted trading emotions but to develop the concentration and focus needed to trade successfully.

In this episode we discuss why traditional approaches to controlling emotions don't work, the role of emotions in trading and how mindfulness can improve trading performance. He also shares some tips on how to get started practising mindfulness, the benefits it can have outside of trading and how the approach of Mental Parking can increase focus.

Topics discussed

  • Comparisons of sports and trading performance
  • Traditional approaches to handling emotions in trading and why they don't work
  • Why it’s impossible to suppress your emotions
  • Landing a plane in the Hudson River and what the Captains response teaches us about trading
  • The role of emotions and how experienced traders actually leverage emotions in trading
  • The concept of Mindfulness and the benefits to traders
  • How to use Mindfulness when trading
  • The evidence that Mindfulness can improve trading performance and how it impacts the brain
  • How to get started practising Mindfulness
  • How to use Mental Parking to increase focus and productivity
  • How exercise can improve mental and trading performance
Sep 27, 2015

Robert Carver is an independent systematic trader who spent more than seven years working for one of the worlds largest systematic hedge funds.

In this episode we discuss trading rules, what makes a good trading rule and the advantages of using continuous rather than binary rules. He also shares insights into over-fitting and the challenges of walk-forward testing that can make it impractical.

Topics discussed

  • What makes a good trading rule
  • The advantages of simple rules
  • Why only some trading rules are profitable
  • Walk-forward testing and some of the challenges that can make it impractical
  • How much data you actually need to determine if a trading rule is better than another
  • Why choosing the optimal values during a walk-forward test is not the best approach and some alternatives
  • Weighting trading rules
  • Steps to avoid over-fitting
  • Should trading rules be adjusted for individual instruments?
  • Continuous trading rules compared to binary rules
  • The applications and advantages of continuous trading rules
  • What makes a good systematic trader
  • The issues that overconfidence creates in trading
  • Two aspects of institutional trading that most retail traders could apply to their own trading
Sep 21, 2015

Brett N. Steenbarger, Ph.D. is a trader, psychologist and trading coach who has been actively involved in the financial markets since the late 1970s.

He is the author of a number of popular trading performance books and consults for hedge funds, investment banks and proprietary trading groups.

Brett has an interest in using historical patterns in markets to find a trading edge publishing measures and strategies on his popular TraderFeed blog. He is also a regular contributor to Forbes.

In this episode we discuss creativity, static thinking and why it's important to have unique ideas for trading success. We also cover tips to increasing our creativity, why traditional trading rules need to be updated, the challenges of daytrading and how to overcome them.

Topics discussed

  • Three important components of successful traders
  • Why the traditional rules of trading need to be updated
  • Why traders get stuck in static thinking and need to be more like entreprenuers
  • The two different types of trading brains and how understand which we are can improve our results
  • How creativity can be used in the strategy research process
  • Why we come up with ideas at seemingly random times and how that can be harnessed to improve our trading
  • The two stages of creativity and how traders are hurting their performance by neglecting the second stage
  • How just immersing ourselves in the market without stepping back can be harming our performance
  • Improving creativity through lifestyle
  • Why unstructured free time away from the markets can improve your trading
  • Techniques to turn creativity into a habit
  • How Brett identified his strengths and used those to dictate his trading style
  • The challenges of daytrading and how to approach them
  • Analysing successful trades to improve performance
  • Why we need to have something more important in your life than trading

PLUS listener questions on:

  • Applications of diffusion indices
  • Formalising edges and the impact of market regimes on edge performance
  • How traders can follow their rules about stops and targets
  • The psychological differences between systematic and discretionary trading
  • The validity of Acceptance Commitment Therapy (ACT) in trading
  • Handling drawdowns and turning it into a constructive experience
  • How to move from retail trader to full-time/pro
Sep 13, 2015

In this episode Dr Van Tharp talks about beliefs and their impact on trading, the qualities of successful traders, adapting trading to market types, position sizing, trading mistakes and overcoming fear, perfectionism and impatience.

Topics discussed

  • How Van got started in the markets and the issues he faced initially
  • The main reasons the majority of trades are unsuccessful
  • How traders can identify the type of strategies that suits them
  • What it means to trade your beliefs in the market
  • How to assess whether your beliefs are useful or limiting
  • The real importance of psychology in trading
  • Your collection of parts and how they interact
  • The process of transformation in a trader
  • Qualities of losing traders and how to test yourself for them
  • The impact mistakes could be having on your results without even knowing
  • How to cope with larger trade sizes as your account grows

PLUS listener questions on:

  • Using position sizing to meet your objectives
  • The 6 market types, how to measure them and how to apply it to your trading
  • How to find positive expectancy systems
  • Developing patience when in a trade
  • Trading in short timeframes
  • How to address issues with perfectionism
  • Systematic vs Discretionary trading
  • Overcoming fear of pulling the trigger
  • Handling drawdowns
Sep 5, 2015

Michael Himmel is a Founding Partner, Portfolio Manager and Director of AI Research for Essex Asset Management.

He has been actively trading and designing systems since the 1980s, managing the No.1 Global Macro Hedge fund in the world in 1999.

He now uses large doses of AI and Machine Learning in his current practice.

In this week’s episode we discuss Artificial Intelligence, the challenges and applications of AI in trading, criticisms of Machine Learning, event studies and the importance of selecting datasets. He also shares insights from starting out as a runner for some of the biggest players in the 1980s, to managing the no. 1 global macro hedge fund in 1999 to using AI in his practise today.

Even if you’re not into AI and machine learning, the stories and insights Michael shares are invaluable.

Topics discussed

  • Lessons from running orders for some of the big players in the 1980s
  • Transitioning from discretionary to systematic trading
  • The challenges of applying Artificial Intelligence (AI) and Machine Learning in the 1990s
  • How changes in technology have made AI in trading available to almost every body
  • How Hedge Fund Lambeth Capital achieved a 260% return in 1999
  • The impact September 2001 events had on hedge fund operations
  • The applications of AI in non-finance industries
  • The three divisions of AI
  • The relationship between machine learning and AI
  • Trading applications of AI
  • How to decide which datasets should be used to avoid data mining
  • Addressing the criticisms of machine learning
  • The challenges of using AI for longer timeframes and is it the right tool for the job?
  • Event studies in trading
  • The future of trading
Aug 30, 2015

Robert Bubalovski is the Managing Director and Head Trader at TradeView investments, a privately held proprietary trading firm located in Melbourne, Australia.

Since 1996 Robert has been actively involved in the financial markets and trading, in 2012 he decided to set up his own Proprietary Trading Firm to concentrate on his own trading strategies.

His team of professional proprietary traders specialize in the trading of Equities, Futures, Options, FX and Money Markets across multiple exchanges around the globe and around the clock.

In this weeks episode we discuss prop trading, the challenges and lessons from beginner trader to starting an investment firm and what it takes to be a successful trader. We also discuss arbitrage and pairs trading strategies, statistical rather than indicator-based trading and the importance of simplicity.

Topics discussed

  • The pros and cons of prop trading
  • The progress of a prop trader
  • How long it takes to become a successful prop trader
  • The attributes of successful traders
  • Advice for those wanted to get started in prop trading
  • Challenges starting out and the lessons learnt
  • Arbitrage and Pairs trading
  • Index arbitrage
  • Selecting stock pairs for arbitrage opportunities
  • Getting started in pairs trading/arbitrage
  • The benefits of pair trading indices vs stocks
  • The dangers of pairs trading in stocks
  • Why keeping strategies simple is so important
  • The main attributes a trader needs to be successful
  • How to increase trade size and be comfortable with it
  • The advantages of strategies based on statistics rather than indicators
Aug 23, 2015

Tim Rea is a proprietary trader, trading his own money with well over 100 automated systems across 25 different Futures contracts.

He is a past winner of the World Cup trading championship, along with being a CTA and broker but gave that away to focus on trading his own money.

In this weeks episode we discuss various aspects of trading multiple strategies, including monitoring performance, money management, correlation, technology and trading in markets not in your timezone. We also discuss the impacts of the MFGlobal and PFG collapses and how Tim overcame the heavy losses to continue trading.

Topics discussed

  • How poor experiences investing with others drove Tim to figure it out for himself
  • Becoming a systems vendor, CTA and broker and why he then left it all behind to just trade his own money
  • How shorter term trading can increase confidence in a system
  • How many strategies he’s currently trading (hint: its more than 100!)
  • Keeping track of the performance of multiple strategies
  • Why you shouldn't just stop trading a system when the drawdown is larger than it has been historically
  • Why you should try to understand the underlying reasons for strategy drawdown
  • Considerations when adding more strategies to a portfolio
  • Managing correlations with multiple strategies
  • Position sizing when trading multiple systems
  • The benefits of trading a portfolio vs trading an individual method
  • How to manage trading in markets not in your timezone
  • The impact of the PFG collapse and how Tim overcame the heavy losses
  • Lessons learnt from dealing with MFGlobal and PFG collapses
  • How to manage your trading account to minimise risk of loss in another collapse
  • The benefits of trading Forex
  • How Tim won the World Cup Trading championship trading just the EURUSD
  • The importance of vision in your trading business
Aug 16, 2015

In this weeks episode Larry Williams talks about conditional trading, understanding what drives prices, the misuse of indicators and how to apply them correctly. We also discuss cycles, forecasting markets, what to look for in market tops plus loads of listener questions where Larry shares tips and insights from 50 years of trading.

Topics discussed

  • What it means to be a conditional trader
  • Why buy and sell signals need to be analysed in the context of market conditions
  • Fundamental factors that drives markets
  • Interpreting the COT reports correctly
  • The buying differences between retail and commercial traders and how it can indicate future market direction
  • Why you should approach trading like a combination lock
  • Coming up with unique indicator ideas
  • The mis-use of indicators and how to use them correctly
  • Trading styles of successful traders
  • Forecasting markets based on technical factors
  • Characteristics of stock market tops and bottoms
  • The fundamentals to watch during market tops

Listener questions

  • Issues with the Forex market
  • Trading prices patterns, do they still work and are they scalable
  • Why short term price patterns work
  • What happened in 2002 and why you need to consider that when backtesting
  • Will trend trading always be effective?
  • How many positions to trade at one time
  • Money management tips for those who aren't into heavy maths
  • Choosing the best markets to trade
  • Favourite Larry Williams indicator
  • What keeps Larry motivated to trade after 50 years
  • What drives peak performance (it’s not money…)
  • The key component that really drove Larry to becoming a consistently successful trader
  • How Larry lasted so long in the industry
  • How to overcome emotions when entering or holding trades
  • Larry’s biggest contribution to the trading industry
  • Why Larrys strategies have lasted the test of time
  • Common traits against the most successful traders
  • The trading model that’s worked for Larry for over 50 years
Aug 3, 2015

Scott Andrews 'The Gap Guy' shares his expertise in gaps, why they work, what factors to take into account when trading gaps and what to avoid. We also discuss gap zones, when to fade and when to follow and calculating stops and targets.

PLUS, for those that aren't into Gap trading, we cover some important concepts that can impact all styles of trading, include one concept called 'Ensemble Systems' which may just change the way you look at trading strategies.

Topics discussed

  • Why it’s important to trade a style that matches your own strengths rather than follow someone else
  • Why gap trading works
  • Markets where gaps work best and those that don't
  • The best type of stocks to trades gaps and the stocks to avoid
  • The benefits of trading gaps in indices vs stocks
  • The 3 market conditions to look at when analysing a gap
  • How seasonality impacts gap trading
  • Signs of gaps to avoid
  • Using ATR to determine the probability of gap size closing
  • Gap zones and how the location of the gap can provide useful information
  • The worst performing gap zone
  • The psychology of certain gap zones and why some work better than others
  • When to fade the gap and when to follow it
  • Calculating stop and profit levels based on gap characteristics and market conditions
  • How to determine if a target should be a full gap close, partial gap close or an extended target past gap close
  • The impact of QE on gaps
  • How to combine systems into Ensemble Systems for an interesting view on trading strategies

 

Jul 27, 2015

Jerry Parker, Turtle Trader and CTA, talks about trend following, how to approach wins and losses, dealing with drawdowns, managing correlations in asset classes and how changing market dynamics have impacted trend following and the solution. He also gives us some tips on systematic trading including how he trades without relying on optimal values of the past.

Topics discussed

  • What types of characteristics Dennis and Eckardt were looking for in the Turtle traders program
  • How the Turtles were taught to approach losses
  • Common traits amongst the most successful Turtles
  • The hardest part of trading as a Turtle
  • How Jerry overcame the fear of taking trades
  • The biggest lesson being a Turtle
  • What Jerry did with the Turtles approach after the program ended
  • The impact managing other peoples money can have on trading
  • The key factors that make trend following work
  • Managing correlations between asset classes
  • Long-term vs short-term trend following
  • Dealing with drawdowns
  • How changes market dynamics have impacted trend following and solutions
  • How to diversify to lessen the impact of any one parameter
  • How to trade without relying on optimal values of the past

PLUS questions submitted by listeners:

  • The difficulties in knowing when to adjust strategy parameters
  • Adjusting your system for whipsaws
  • Tips to avoid data mining
  • Do the Turtles systems still work in the todays markets?
  • Are there any markets where the strategies no longer work?
  • Short versus Long trades
  • Overcoming emotions in trading
  • Biggest mistakes and the lessons learnt
  • What todays Turtle program would look like
Jul 20, 2015

World Cup Trading champion Andrea Unger discusses how to create robust strategies, the role of indicators in trading, principles to strategy creation, Forex trading strategies and optimising to understand market behaviour.

Topics discussed

  • The strategies and position sizing Andrea used to win the world cup trading championship 4 times
  • The role of luck in trading
  • Controlling risk when trading multiple strategies
  • Where to find trading ideas
  • The principles Andrea uses in the Forex and Futures markets to develop profitable strategies
  • The role of indicators in strategy development
  • Matching strategy type to market characteristics
  • Why you should analyse your biggest winners as well as your biggest losers
  • Forex trading tips and changes in the Forex market
  • Using longer timeframes to filter trades in shorter timeframes
  • When to optimise or tweak a strategy and how to ensure you don’t over-optimise
  • The drawbacks of trend following and the solution
  • Tips to handling drawdowns
  • Intraday vs End-of-day trading
  • The key to trading success.
Jul 12, 2015

Stuart McPhee discusses the common mistakes traders make, the single biggest factor to trading success, the counter-intuitive side to trading and tips to improving trading discipline.

Topics discussed

  • Why trading can be simple but not easy
  • Common mistakes traders make
  • Factors to consider when choosing a trading strategy that suits you
  • Common Money Management mistakes
  • The single biggest factor to trading success
  • Common mindset issues traders experience
  • Tips to improving discipline and changing trading behaviour
  • How the Petronas towers can be applied to trading
  • The counter-intuitive side to trading
  • The Chinese Bamboo story
Jul 5, 2015

Performance coach Rande Howell discusses the most common issues limiting trader performance, the impact of emotions on trading, the importance of managing process not outcome and tips on changing our physiology to improve performance.

Topics discussed

  • The most common issues impacting trader performance
  • What causes hesitation when taking trades
  • How to calm the emotions when trading
  • An easy way to monitor changes in emotions
  • The impact of breathing on emotions and trading
  • A simple trick to disrupt fear
  • Patience and boredom in trading and how to overcome them
  • Are you an African Lion or an American Cougar when trading?
  • Personal traits that don’t align well with trading success
  • How successful traders handle drawdowns
  • The stage in a traders journey where performance coaching provides the most value
  • What successful traders need to watch out for to continue operating at their peak
  • How overconfidence and euphoria can destroy your trading
  • Tips for getting prepared for the trading session
Jun 29, 2015

Andreas Clenow is a hedge fund manager who specialises in developing and trading quantitative strategies across all asset classes.

Before joining the hedge fund world by establishing his own hedge fund he maintained Global Head positions at Reuters and Equis International.

He is the author of two books, the first being international best seller ‘Following the Trend’ and the second ‘Stocks on the Move’ has just been released.

In this episode Andreas talks about trend following in stocks, why traditional approaches don't work and what you can do to account for this. We also talk about trading concepts, cash vs risk allocation, position rebalancing and building robust strategies.

Topics discussed

  • The origins of trend following and why a traditional trend following approach doesn't work on stocks
  • Why it’s a bad idea to think in terms of cash allocation and the solution
  • Position rebalancing, why, how and when
  • How hedge funds look at position sizing compared to retail traders
  • Why pyramiding positions doesn't make sense
  • How to get a more realistic understanding of performance results than just a backtest report can provide
  • How a random number generator can beat the mutual funds
  • How to ensure you strategies are robust and not curve-fit
  • Handling large losses or periods of drawdown
  • The role of critical thinking in trading
Jun 21, 2015

Dr Ernest Chan talks about many aspects of quantitative trading, including how market crises impact momentum strategies and how to manage the impacts, when to use stop-losses and when they don't make sense, automating trading, managing funds in a portfolio of strategies and a simple money management approach which aims to limit drawdowns while maximising returns.

Topics discussed

  • Where to find trading ideas
  • The first aspect of a market to identify before building a strategy for it
  • Momentum crashes and the performance of momentum strategies after a financial crisis
  • How to manage the times when momentum strategies aren’t working
  • When stop losses should be used and when they don’t make sense
  • How to limit drawdowns while maximising growth
  • Factors to consider when automating your trading
  • How independent traders can avoid competing with the big trading firms
  • When you need to worry about market microstructure and when it doesn’t matter
  • Managing funds for a multi-strategy portfolio
  • The hardest part of trading
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