I will do a thread on this subject.
This game IS EASIER than ppl think it is. It’s NOT hard 2 win, but it can be if you listen to opinions vs the data, & you let those in this business make you believe you cannot do this on your own.
#trading vs #investing + #riskmanagement
This game IS EASIER than ppl think it is. It’s NOT hard 2 win, but it can be if you listen to opinions vs the data, & you let those in this business make you believe you cannot do this on your own.
#trading vs #investing + #riskmanagement
https://twitter.com/hedgeye/status/1350115132551135233
1/ Here is why I believe #investing & #trading is/can be easy if you just look at the (price) data. Not a diss to Hedgeye, Real Vision, or anyone else w/ an opinion (data or feeling based doesn't really matter)
Example $SPY 1M chart w/ Heikin Ashi, 21, 50, 100, 200 MAs +MACD
Example $SPY 1M chart w/ Heikin Ashi, 21, 50, 100, 200 MAs +MACD
2/ Here is $SPY on a weekly with Quad *estimates* from the Macro Show slide deck, dates above each line.
3/ Slide from the Macro Show on 10/28 with items that **tends** to outperform/underperform in each quad.
I ended up making "quad" portfolio lists on investing.com . There were quite a few that overlapped.
At the time $SPY performs well majority of the time.
I ended up making "quad" portfolio lists on investing.com . There were quite a few that overlapped.
At the time $SPY performs well majority of the time.
4/ How to make this game "easy". Trade less.
Easiest way is to pick 1 thing and learn to invest/trade it.
Investing = long term hold
Trading = short term hold
$SPY monthly chart w/ MACD and some MAs.
5 years, 10 trades
Easiest way is to pick 1 thing and learn to invest/trade it.
Investing = long term hold
Trading = short term hold
$SPY monthly chart w/ MACD and some MAs.
5 years, 10 trades
5/ IMO the markets are an online casino. Like casinos, the more U play the more chances U have 2 lose.
U have 2 have a process. You have to execute that process. The more you deviate from it the more risk you take.
Stick to a 1M chart to avoid being shaken out.
U have 2 have a process. You have to execute that process. The more you deviate from it the more risk you take.
Stick to a 1M chart to avoid being shaken out.
6/ I get it. We are taught that there is "always something to do". I started working @ 16. Everyday I worked I was doing "something" for the company, my job.
If U want to be more of an "active" investor I suggest using a tri-view.
1M - Primary
1W - Secondary
1D - Noise
If U want to be more of an "active" investor I suggest using a tri-view.
1M - Primary
1W - Secondary
1D - Noise
7/ What do you rotate into when YOUR process says don't add, sell some, sell all? I would stick to cash. I know, inflation, but holding cash for 1-6 months isn't going to kill you.
You can also go with $BIL $SHY
$SPY weekly with BIL and SHY
You can also go with $BIL $SHY
$SPY weekly with BIL and SHY
8/ I tend to oversimplify things & then build up core ideas.
If you want to over complicate things you can use levered ETFs for those times your process tells you to sell. I would not hold these long term. Get what you need & get out.
1. ProShares Geared ETFs
2. Direxion
If you want to over complicate things you can use levered ETFs for those times your process tells you to sell. I would not hold these long term. Get what you need & get out.
1. ProShares Geared ETFs
2. Direxion
9/ There are plenty of smart people in this biz. But let me oversimplify. What are they actually doing for you? They are taking THE DATA and presenting it to you.
Once they have the data they interpret it. Data based or felling based opinions are both still opinions.
Once they have the data they interpret it. Data based or felling based opinions are both still opinions.
10/ We all prefer the data based options. But what can't you gather the data and plug it into excel? I saw this tweet from Chigrl and it makes my point.
You have to chose to learn & get involved or it will always be someone that is "telling" you something.
You have to chose to learn & get involved or it will always be someone that is "telling" you something.
11/ So I go back to having 2 options (oversimplifying)
1) you can keep it simple - 1 investment or trade. Learn it.
2) listen to others - Learn their process and MAKE IT YOUR OWN!!!
What frustrated me the most w/ Hedgey or listening to smart, experienced people......
1) you can keep it simple - 1 investment or trade. Learn it.
2) listen to others - Learn their process and MAKE IT YOUR OWN!!!
What frustrated me the most w/ Hedgey or listening to smart, experienced people......
11a/ was not understanding their time frame. The majority of people have "long term" views. But long term to me may not be long term to you.
Hedgeye dunking on gold bugs when $GLD was shown as a Quad2 long end of October is another example.
And the risk ranges was the last.
Hedgeye dunking on gold bugs when $GLD was shown as a Quad2 long end of October is another example.
And the risk ranges was the last.
12/ As mentioned before, I worked offshore. My job was in inspection/surveys/compliance of blowout preventors.
I returned home 5/11, covid free. 1 test prior to going onboard the rig. 2 negative test on the rig due to a scare. 1 negative test after departing & before going home
I returned home 5/11, covid free. 1 test prior to going onboard the rig. 2 negative test on the rig due to a scare. 1 negative test after departing & before going home
13/ End of May I test (+) > sidelined for 10 Ds > then tested (-) twice.
June I was called out again with the same result > (+) > 2 (-) tests 8 days later.
I resigned from my job. I just wanted to avoid all the covid craziness.
June I was called out again with the same result > (+) > 2 (-) tests 8 days later.
I resigned from my job. I just wanted to avoid all the covid craziness.
13a/ I tell you that to come back to the "risk ranges". I wld frustrate me when the price would not tough either side of the range for the day.
I know, I know, they are dynamic and change as the price changes. But to me a "daily" risk (price) range should hit one side minimum.
I know, I know, they are dynamic and change as the price changes. But to me a "daily" risk (price) range should hit one side minimum.
13b/ Now that I was home more I began doing what? Trading more.
I changed my safe, easy process, which always beat the S&P 500 every year, to playing more.
I have been self-employeed since 5/2012 so I have not had a 401K.
I am more than capable of loosing my own $ to trust FPs
I changed my safe, easy process, which always beat the S&P 500 every year, to playing more.
I have been self-employeed since 5/2012 so I have not had a 401K.
I am more than capable of loosing my own $ to trust FPs
13c/ I lost quite a but of $ with the "risk ranges". Not blaming Hedgeye. They don't tell you what duration or what strike. That was all me.
But **I** misunderstood the Daily Risk Range. That got me started on finding ways to come up with my own. KM talked about .....
But **I** misunderstood the Daily Risk Range. That got me started on finding ways to come up with my own. KM talked about .....
13d/ building "the machine". Using AI...etc. I didn't have all those things. But he also kept repeating that "its just math".
I began putting the closing price and his daily ranges and studying those.
I began taking known indicator formulas and modifying them.
I began putting the closing price and his daily ranges and studying those.
I began taking known indicator formulas and modifying them.
13e/ I even began "measuring & mapping" his attitude (good vs bad days, victory laps vs lets move on from why we got it wrong).
I am thankful because it got me engaged. I was determined to learn & I ended up with my excel trend/projection charts.
But I found something....
I am thankful because it got me engaged. I was determined to learn & I ended up with my excel trend/projection charts.
But I found something....
13f/ There R certain ppl that I will take ⏲️ to listen to. KM was one of them.
I want you to listen or re-listen to this interview. For now skip to minute 54:15 & stop at 56:05.
Pay attention to what KM says then what Raoul follows up with.
I want you to listen or re-listen to this interview. For now skip to minute 54:15 & stop at 56:05.
Pay attention to what KM says then what Raoul follows up with.
13g/ It's just **MY ASSUMPTION** that the "risk ranges" are F'ing Bollinger Bands!
I looked at my excel charts that were "mapping" the closing price + KM's daily RRs..... I was staring at Bollinger bands this whole time!!
Being honest, I was angry....
I looked at my excel charts that were "mapping" the closing price + KM's daily RRs..... I was staring at Bollinger bands this whole time!!
Being honest, I was angry....
13h/ All that ⏲️ spent on formulas. Countless times KM would say its the machine he built. All the ⏲️ he wld make fun of the old wall for using "moving monkeys".... and the daily risk range "product" is Bollinger Bands??
13i/ Again, this is just my assumption. I have no proof. But I would suggest you try it.
Use BB (9, 2) or (9, 2.3) and see how close you get to the daily RRs on anything on the list.
Add a 13, 21, 43 MAs.
Use BB (9, 2) or (9, 2.3) and see how close you get to the daily RRs on anything on the list.
Add a 13, 21, 43 MAs.
14/ I am not rich, but God has provided for me and my family every day. He has blessed me tremendously financially. I have worked hard, traveling 60-65% a year, but he provided the opportunities
I will be 39 next month. I am married & have 4 kids, all girls. 16, 8, 4, & 6 mths
I will be 39 next month. I am married & have 4 kids, all girls. 16, 8, 4, & 6 mths
14a/ I tell my oldest daughter that I will teach her from my mistakes. 1 oversimplified lesson I have taught her is
In life every1 is going to want 2 things. Your time, your money, or both.
You have to figure out who is wasting your time or adding value to it....
In life every1 is going to want 2 things. Your time, your money, or both.
You have to figure out who is wasting your time or adding value to it....
15/ Back to the main point. Keep it simple. Listen to the (price) data vs opinions.
Take this round table. Some of the smartest people in finance/economics/markets. But when will what they see & believe actually happen? They don't know.
Take this round table. Some of the smartest people in finance/economics/markets. But when will what they see & believe actually happen? They don't know.
15a/ Listen to everything. Write down the key topics, the main words that keep coming up. Search for more information.
As long as the price data says to stay long, stay long. Eventually what these smart people see & believe WILL PLAY OUT one day.
Until then follow the price.
As long as the price data says to stay long, stay long. Eventually what these smart people see & believe WILL PLAY OUT one day.
Until then follow the price.
16/ Lastly, here is part of my process.
1) What does the trend say? $SPY as of 1/15. The primary signal on the 1yr and 2yr charts have been **suggesting** a change in trend coming. Correction, crash, false signal???
2) What does the 1M, 1W chart say?
1) What does the trend say? $SPY as of 1/15. The primary signal on the 1yr and 2yr charts have been **suggesting** a change in trend coming. Correction, crash, false signal???
2) What does the 1M, 1W chart say?
17/ I try to help family/friends who only have 401K. They really have no good options to sidestep draw downs.
You basically have a "stable fund" which is short term bonds.
What I share on here is just the same. Here is the "data'. What does it say? How can you use it?
You basically have a "stable fund" which is short term bonds.
What I share on here is just the same. Here is the "data'. What does it say? How can you use it?
18/ podcast list in no particular order:
Tony Evans, Urban Alternative
Adrian Rogers, Love Worth Finding
Peter Schiff Show
Macro Voices
NAB Morning Call
Lance Robert’s Real Investment Show
Saxo Morning Call
CATO Daily Podcast
Ben Shapiro Show
Corbett Report
Axios Recap
Tony Evans, Urban Alternative
Adrian Rogers, Love Worth Finding
Peter Schiff Show
Macro Voices
NAB Morning Call
Lance Robert’s Real Investment Show
Saxo Morning Call
CATO Daily Podcast
Ben Shapiro Show
Corbett Report
Axios Recap
18a/
The Investors Podcast
Investment Mag, Market Narratives
Alpha Trader
The Grant Williams Podcast
FactSet market preview
Voices of Wallstreet
Bloomberg What Goes Up & Surveillance
Jesse Felder Super Investors
The Sherman Show
The Investors Podcast
Investment Mag, Market Narratives
Alpha Trader
The Grant Williams Podcast
FactSet market preview
Voices of Wallstreet
Bloomberg What Goes Up & Surveillance
Jesse Felder Super Investors
The Sherman Show
18/c YouTube:
Atlantic Council
CDC
DoubleLine Capital
LaDuc Trading
Shadow Trader
The Last American Vagabond
The Market Huddle
World Economic Forum
World Heath Organization
Atlantic Council
CDC
DoubleLine Capital
LaDuc Trading
Shadow Trader
The Last American Vagabond
The Market Huddle
World Economic Forum
World Heath Organization
19/
I have learned a lot from just following these two people.
These two tweets sums up the point of this thread.
......THE END......
I have learned a lot from just following these two people.
These two tweets sums up the point of this thread.
......THE END......
20/ P.S.
Sorry, but this just showed up in my inbox. I tried their SPY service for a while & was disappointed.
There was a time where I questioned my “simple method”. In the end it’s what works for me.
(For a little while I thought this was a KM side business. “Fractal Math”)
Sorry, but this just showed up in my inbox. I tried their SPY service for a while & was disappointed.
There was a time where I questioned my “simple method”. In the end it’s what works for me.
(For a little while I thought this was a KM side business. “Fractal Math”)
21/ P.S.S
Two podcast episodes that I think confirm the point of this tread.
Timeframes
Data, what are you using to trade/invest.
Define YOUR process. What “works” for me may not work for you.
Narratives
The “game”
1. pca.st/episode/d6737a…
2. pca.st/episode/609a67…
Two podcast episodes that I think confirm the point of this tread.
Timeframes
Data, what are you using to trade/invest.
Define YOUR process. What “works” for me may not work for you.
Narratives
The “game”
1. pca.st/episode/d6737a…
2. pca.st/episode/609a67…
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