Astounding Quotations from the Court Jester (as stated in the system description of Magnum (Conservative) Stocks/ETFs)
Please ignore the quaint combined equity curve, Drawdwn & Risk column, APD and the Max. Drawdown figures reported by C2 as these are false or stolen concepts and is fraught with bad quote errors, rife with calculation errors, fallacies and prejudices to base any concepts on it.
Palsun has issues with using things like Drawdowns, Risk, and equity curves. He left out his distaste also for the Sharpe Ratio.
The Funny One finds his best tools include the Divining Rod, Ouija Board, and Chicken Entrails…
Instead of attempting to understand on the level the words are written, you choose to relate it to Pals systems and therefore have once again choosen the dark side.
You did not mention his systems directly this time but by now we all get it, to you attack is better than understanding.
you choose to relate it to Pals systems and therefore have once again choosen the dark side.
dark side? You mean the Palsun who takes on false identies (Brian M), rambles on for 90 sentences that are semantically devoid, and deleted posts of anyone who disagrees with him on a regular basis?
If Palsun is Obi-Won, then the Rebellion will wink out in about 30 seconds. Either that or the Empire will fall asleep after listening to too many of his messages.
To subscribe to Palsun beliefs is to suspend the paradigm and collective understandings of the investment community in favor of becoming a free-range chicken.
Try understanding the history of his posts, or you will quickly proceed from a reasonable-seeming person into the room wallpapered with mattresses.
So at which "level" is it reasonable to ignore open drawdowns?
"So at which "level" is it reasonable to ignore open drawdowns?"
Many people have been doing it at the level indicated below.
Many times it has been said, buy stock and hold it untill you retire, and do not worry about wheather it is up or down at any given time, for it only matters where it is at the time of retirement. In essence there are no loses along the way, only gains at retirement.
But
1. This advice is about unleveraged instruments.
2. You forget to mention that this advice assumes proper diversification, which isn’t guaranteed in C2 systems.
3. The advice is to hold, but most C2 systems trade frequently, which makes them much more risky, which requires assessment of that risk.
4. With proper diversification this advice corresponds to buying and holding an index like S&P. The advice is based on the history of such indexes, which is known over decades. The history of C2 is much shorter, and characteristics of C2 systems are very different from an index. So why would the same advice apply to C2 systems?
5. The advice assumes a long-term invesment horizon (of decades) and this is not necessarily something that a C2 trader has or wants to have.
6. Even though the advice is given often, that doesn’t mean that it is a good advice - let alone the best advice. IMHO it is typically the advice given by people who cannot trade to people who have never traded.
I remember back during the dot com bubble there were many, many web-sites flouting covered calls as the way to riches. The direction of the underlying stock was irrelevant - in the long term the stocks would go up. All that mattered was that you could realize profits on writing call options month after month. Where are they all now? They are all gone except for Gilbert.
You asked for a level where it was acceptable, one was given.
Yes, but it is a level outside C2. Irrelevant for the claim of Pal, which you seem to defend, that one should ignore the open DDs of his systems.
even to the point of 95% DD. TO most investment professionals, even things like 30% DD is where most subscribers would have bailed.
To Pal, no problem, since C2 allows vendors to take their portfolio well below $0K. Unfortunately, most brokers will not.
Ok, perhaps I am wrong to do so, but I am only talking about the reality of the words, and not saying anyone should use this reality in developing trading systems, but at the same time if one chooses to and traders subscribe thats up to them. I have had a system for about 12 years which adds to the position as prices move against the position. While this system should return about 50% a year, it is nothing I would ever trade with, but some would. If the rules are not followed exactly margin call. But if the rules are followed good system.
