Do we over complicate this?

Howard Cohodas: Chuck, The owner of the company of the desk I use called me and said he was going to use the video in his promotion. He also offered to make me part of his affiliate program. Shortly you will be able to buy the TrekDesk through my affiliates web site. :)

http://www.facebook.com/howard.cohodas?v=wall#!/howard.cohodas?v=wall

Its quite clear if you're going to talk the talk, you've got to walk the walk, and what a walker we have!
 
We need to all chill out have a shot of wiskey, a pull of smoke and listen to some music.

 
HowardCohodas said:
Studies at the Mayo Clinic would seem to disagree with you. Video: Step up office exercise with a treadmill desk By Mayo Clinic staff

Furthermore at 7 degrees incline you would find the results different than you state.
Click to expand...

A brisk 20 minute walk and a good nutritional diet with no snacky snacks will lose the pounds. To get results when exercising you must achieve overload also. Besides the point anyway.
Normally I block bs like yours, but this evening I am a little bored and "know it alls" p*ss me off. Go away, stop defending yourself, in this forum we have seen it all before at one stage or another.
 
Not sure I'd get checked up at the Mayo clinic!

Doctor in ***** photo scandal leaves Mayo Clinic
(AFP) – Dec 21, 2007
PHOENIX, Arizona (AFP) — A doctor at a prestigious Arizona clinic who took a photograph of a patient's tattooed ***** during surgery is "no longer practicing medicine" at the center, it was confirmed Friday.
Mayo Clinic spokeswoman Lynn Closway would not reveal whether surgeon Adam Hansen had been fired or resigned following the revelations which rocked the Nobel Prize-winning medical center this week.
"I am not allowed to speak off of that statement," clinic spokeswoman Lynn Closway said. "Play it as you see it."
Hansen, chief of general surgery at the clinic in Scottsdale, had admitted taking the patient's photo after noticing it was emblazoned with the words "Hot Rod," local media have reported.
The patient at the center of the controversy is a strip-club owner who had been undergoing a gall bladder operation. The incident came to light after a member of the clinic's surgical staff contacted a local newspaper on Monday.
 
meanreversion said:
Oh dear, I don't know where to begin on this one.

You've backtested and found a strategy that has been successful for a few months. You've then persuaded some folk to part with their cash in order for them to learn this strategy. When it stops working, you'll simply devise a new strategy and then persuade some different folk to spend their money? Has it occurred to you that the previous folk might be slightly annoyed that they lost money ... ? Nevermind, there's a sucker born every day huh!

(You use the term "exploit" - does this refer to your students and their wallets?)
Click to expand...

You are assuming facts not in evidence.

I have a four step strategy qualification process based on my engineering background.

I used computer simulation (back testing) first on two years of data and eventually on five years of data. Furthermore, I divided the test data set into two non-contiguous parts so that the training results could be validated on data the model had not seen in training.

Next I prototyped (paper trade) for five months. Before I went to the next step, I reviewed my results with my son, a mathematician and economist, for his insights on anything I may have overlooked. He now trades the strategy. During the process of explaining it to him he said I did a good job at organizing the material for our talk. I got the idea to teach.

In expectation of possibly teaching this strategy, I opened a separate auditable account for this strategy exclusively. I then entered pre-production (small money trades) to assure myself that I adequately accounted for the limitation of back testing and paper trading.

One month after pre-production started, I entered full production (trading with serious money). The results I quoted from my auditable account are from pre-production and production efforts.

Part of the ongoing management of the strategy is to conduct in-process quality assurance. I use a trading journal where I note each transaction, what went right and what went wrong. In that fashion I can see if my process can be improved, if I failed to followed my rules purposefully or accidentally, etc.. I also look at the results over a longer period of time to determine if a systemic change is taking place in the marketplace that would invalidate the strategy. In this fashion, one can suspend trading before I or my students get into trouble.

I've only prototyped my training on a few students so far as I finish my training materials. I did not solicit them, but they knew what I was doing, saw my account and suggested that it would be worthwhile to debug my training process. Yes, they paid. So far, the students have responding by recommending that others take the course when available.
 
HowardCohodas said:
Surprisingly, as an automation specialist, one spends most of ones time simplifying things.

The same goes for my trading life. So many tools, displays, graphs, data, newsfeeds, etc. drain your brain of it's ability to notice opportunity or danger and take appropriate action. After completing my trading strategy, I noticed that I had way to much information that I was looking at to make effective management decisions. I embarked on a process of reducing it to its bare minimum. My Trader's Dashboard now is quite sparse. Only the information needed to identify that action is required. Then I move to a display containing the necessary information to carry out the action.

I'm in the process of writing an article on my Trader's Workbench a part of which is the Trader's Dashboard. In the process of writing the article I found I could simplify even more when I came to writing the justification in including some items that had still remained on the Dashboard.
Click to expand...

HowardCohodas said:
You are assuming facts not in evidence.

I have a four step strategy qualification process based on my engineering background.

I used computer simulation (back testing) first on two years of data and eventually on five years of data. Furthermore, I divided the test data set into two non-contiguous parts so that the training results could be validated on data the model had not seen in training.

Next I prototyped (paper trade) for five months. Before I went to the next step, I reviewed my results with my son, a mathematician and economist, for his insights on anything I may have overlooked. He now trades the strategy. During the process of explaining it to him he said I did a good job at organizing the material for our talk. I got the idea to teach.

In expectation of possibly teaching this strategy, I opened a separate auditable account for this strategy exclusively. I then entered pre-production (small money trades) to assure myself that I adequately accounted for the limitation of back testing and paper trading.

One month after pre-production started, I entered full production (trading with serious money). The results I quoted from my auditable account are from pre-production and production efforts.

Part of the ongoing management of the strategy is to conduct in-process quality assurance. I use a trading journal where I note each transaction, what went right and what went wrong. In that fashion I can see if my process can be improved, if I failed to followed my rules purposefully or accidentally, etc.. I also look at the results over a longer period of time to determine if a systemic change is taking place in the marketplace that would invalidate the strategy. In this fashion, one can suspend trading before I or my students get into trouble.

I've only prototyped my training on a few students so far as I finish my training materials. I did not solicit them, but they knew what I was doing, saw my account and suggested that it would be worthwhile to debug my training process. Yes, they paid. So far, the students have responding by recommending that others take the course when available.
Click to expand...

I think you had better get Jim Simons on the line.
 
meanreversion said:
Not sure I'd get checked up at the Mayo clinic!

Doctor in ***** photo scandal leaves Mayo Clinic
(AFP) – Dec 21, 2007
PHOENIX, Arizona (AFP) — A doctor at a prestigious Arizona clinic who took a photograph of a patient's tattooed ***** during surgery is "no longer practicing medicine" at the center, it was confirmed Friday.
Click to expand...

And just how does one person's malfeasance invalidate everything a well-respected institution does? If someone in your family is a criminal, am I to assume you are as well? I think not.
 
sinimini said:
I think you had better get Jim Simons on the line.
Click to expand...

My initial analysis indicates that it would not scale to trading Billions of Dollars. That idea needs more thought which I have not been motivated to do at this time.

I think I'll get some more trading and teaching under my belt before I can develop the level of arrogance to approach someone like Jim Simmons.
 
HowardCohodas said:
My initial analysis indicates that it would not scale to trading Billions of Dollars. That idea needs more thought which I have not been motivated to do at this time.

I think I'll get some more trading and teaching under my belt before I can develop the level of arrogance to approach someone like Jim Simmons.
Click to expand...

Perhaps David Shaw then?
 
HowardCohodas said:
I used computer simulation (back testing) first on two years of data and eventually on five years of data. Furthermore, I divided the test data set into two non-contiguous parts so that the training results could be validated on data the model had not seen in training.

I've only prototyped my training on a few students so far as I finish my training materials. I did not solicit them, but they knew what I was doing, saw my account and suggested that it would be worthwhile to debug my training process. Yes, they paid. So far, the students have responding by recommending that others take the course when available.
Click to expand...

Howard, you sound like a nice chap and I'm sure you're well meaning. I do wonder how much experience you have with either trading or system backtesting.

You refer to testing on "unseen" data.. this is commonly called "walk forward testing" and can be carried out on inexpensive software such as Amibroker (http://www.amibroker.com/guide/h_walkforward.html). It doesn't require a degree in engineering; I'm not sure why you felt the need to include that information.

I suggest also that you read "Market Wizards" if you haven't done so already. It profiles several very successful traders. The two things that struck me were 1) they all seem to refer to 1% as the optimal bet size and 2) they all trade very different strategies - some are trend followers, some scalp, some look for mean reversion etc.

The point is, the strategy itself is not nearly as important as you think. Money management and psychology are what will make or break the trader, and for this I would suggest you should backtest further than five years.. ten at the very least. Ultimately you will not be able to persist in trading your strategy through drawdown if you don't have the utmost confidence.

Furthermore, you mention you have been making money the last few months from selling credit swaps (is that right?). I don't know anything about them, but would guess that's profitable when the markets are rising? But what about if the market suddenly does a 180 and dumps, then what? You really can't claim anything on the back of a track record under two years minimum of live trading.
 
meanreversion said:
Howard, you sound like a nice chap and I'm sure you're well meaning. I do wonder how much experience you have with either trading or system backtesting.

You refer to testing on "unseen" data.. this is commonly called "walk forward testing" and can be carried out on inexpensive software such as Amibroker (http://www.amibroker.com/guide/h_walkforward.html). It doesn't require a degree in engineering; I'm not sure why you felt the need to include that information.

I suggest also that you read "Market Wizards" if you haven't done so already. It profiles several very successful traders. The two things that struck me were 1) they all seem to refer to 1% as the optimal bet size and 2) they all trade very different strategies - some are trend followers, some scalp, some look for mean reversion etc.

The point is, the strategy itself is not nearly as important as you think. Money management and psychology are what will make or break the trader, and for this I would suggest you should backtest further than five years.. ten at the very least. Ultimately you will not be able to persist in trading your strategy through drawdown if you don't have the utmost confidence.

Furthermore, you mention you have been making money the last few months from selling credit swaps (is that right?). I don't know anything about them, but would guess that's profitable when the markets are rising? But what about if the market suddenly does a 180 and dumps, then what? You really can't claim anything on the back of a track record under two years minimum of live trading.
Click to expand...

Trading experience?
Consultant to traders on and off for seven years.
Active trader, on and off for one year. Constantly for 8 months.

Walk forward testing vs. validating model on not contiguous with data data used in training
My understanding of trading forward is that it violates the non-contiguous rule. There may be a break in time, but it is all forward in time from the training set. Some people refer to paper trading as walk-forward testing.

Engineering background
I don't believe I implied my engineering background was required to develop and test trading strategies. I did state that my engineering background informed my approach and vocabulary in a disciplined and structured qualification process. And it does mean that some traders I consult with take my structured qualification process to heart.

Trading strategy with an edge vs. psychology vs. money management
We are in violent agreement here. Other posts in the forum covers some of these ideas.

selling credit swaps (is that right?)
No, not right. Selling index options credit spreads. A well understood strategy taught by many. I have simply amped up the rule set to make it less risky by using tools recently available on at least one trading platform. Combining a PUT credit spread with a CALL credit on either side of the underlying is called an Iron Condor. It is normally known as a strategy for sideways markets and dangerous in trending markets. I have developed some technique that can make it potentially more profitable in a trending market, but requires more management than is typical when trading Iron Condors. Many Iron Condor strategies lost money on the October expiration options. I made more money than if the market had just traded sideways.

This strategy makes money if the market moves sideways, makes money when the market trends upward, makes money when the market trends downward. The most danger is when the markets move aggressively upward or downward. I have yet to experience this event, but I use contingency orders which are constructed to limit the loss to 20% to 25% of the capital at risk (margin).

I appreciate polite questioning. It gives me a chance to understand my approach on a much deeper level as I explain it.
 
HowardCohodas said:
And how does the Mayo Clinic's reputation compare with equivalent places in the UK? Must be why so many from the UK come to the Cleveland Clinic and the Mayo Clinic.;)

I hope you don't conduct your trading life on such sparse anecdotal evidence.
Click to expand...

That's a fair point. I was intrigued by a clinic named after an unhealthy substance, so googled it. I've been to Arizona, they've obviously got some world class medical facilities there, presumably in response to demand from the wealthy and, um, more mature population.
 
HowardCohodas said:
Trading experience?
Consultant to traders on and off for seven years.
Active trader, on and off for one year. Constantly for 8 months.
Click to expand...

This kind of thing saddens me immensly.

It is small wonder that so few make it when people with such little experience decide they can make money by charging newbies for 'training'.

I do agree that it's not just method that makes someone profitable. I don't subscribe to either money management or psychology being the key. I think the key is experience combined with a feedback loop - or a journal.

You trade, you write down your observations, you make adjustments as necessary.

If your journal says 'impulse trade', 'impulse trade', 'revenge trade', 'boredom trade', then I am confident most people will overcome the issue fairly quickly. If you leave too much money on the table all the time, buy tops all the time, again - you will see the issues.

The problem though - what if you have no idea what to trade or how people trade profitably ? How do you develop a method to journal ? Would there be any point in journaling a day trading system based on MACD and Astrology ? My gut feel is that even with a feedback loop in place, you'd fall on your face because you are basing your development on faulty methods - building a house on sand.

Therein lies the problem - 99% of trainers have no idea what they are doing. I paid 3 people for education and it became obvious that one of them couldn't trade. The one that couldn't trade was full of math BS and had an ego the size of a house. Initially I thought "oddball genius" but it turned out he was "egotistical psycopath'. The other 2 were laid back 'take it or leave it' guys.

So now we have another math genius software engineer who has developed some mathematical edge and super secret trading methods he'll teach to newbies whilst he's barely out of his trading diapers himself.

Scam, rip-off, misguided - call it what you will. Just another day in the wonderful world of trading.
 
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