# trend following strategies



## z106 (4 Dec 2007)

Does anybody here use any trend following strategies that have worked / failed  when investing in equities ?

In fact - what do people feel generally about trend following straegies?
DO they think there is some substance to the theory or do they think it is a load of rubbish?


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## zephyro (4 Dec 2007)

This has been tested extensively and security prices do trend, whether it's exploitable after costs is arguable.


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## EddieT (4 Dec 2007)

Hi,

Currently working on this at the moment. Have been for 4 months now and beginning to make some progress, though I have been stung a number of times after making some stupid errors. But have learned an awful lot from the experience and still determined to hang in.

I have based the foundations of my strategy on a great book I came across when reasearching Spread Betting:

http://www.amazon.com/Financial-Spr...bs_sr_1?ie=UTF8&s=books&qid=1196792617&sr=8-1

Absolutely invaluable as the biggest problem with Trend following is managing the leverage aspect. If your triggers are too far away then you never get in while if they are too tight you lose your bet before you can blink...... It is a real balancing act. To me it is far more important than the strategy (risk management).

Basically the strategy is just an indicator of potential .....the hard part of jumping on the trend with a minimum of capital exposed and then pulling up your stop loss as you start to make profit. That is why the book is important. 

Problem at the moment is that the markets are neither trending up or down so opportunities are very limited (supported by Market Monkey in the Tribune).

I use equis to run explorations against the market and then identify potential opportunity. 

I spotted "Charter" in the UK as an opportunity last week. The stock was at 910. I put in an order to Sell at 894 with a stop loss at 916. The order was actioned and then closed out in a few hours so despite the signs decided not to go back in. Since then the stock has dropped an impressive 139 points !!! Lesson here was my spread range is too tight in a volatile market but if I kept my discipline then I would have been okay. This has happened a few times.

My advice .... read, read, read and then use the Simulators (Paddy Power is best as Delta does not allow access to charts (which incidentially are not right anyway)). Ultimately though you have to learn on the job, when to get out and when to stay in....

EddieT


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## z106 (5 Dec 2007)

EddieT said:


> Hi,
> 
> Currently working on this at the moment. Have been for 4 months now and beginning to make some progress, though I have been stung a number of times after making some stupid errors. But have learned an awful lot from the experience and still determined to hang in.
> 
> ...


 
Interesting stuff Eddie T.

SO - in summary,what is teh trading strategy in that book you mentioned?

E.g. I have come accross one trading strategy which says buy long when the price is above both the 40 day and 20 day simple moving average.
And exit the long position when the price dips below the 20 day S.M.A.

For going short it recommends doing teh opposite.
THis theory however was put forward by a guy called vince stanzione who seems to generally have a dodgy rep o just running realy expensive workshops of no real substance. Maybe that's just the cynics speaking !!

ANother strategy by a different guy called mark shipman also seems interesting.
He looks at far more long term and invests only after 12 week higher-highs.Normally he could hold a position for many many months.
By the way - mark shipman comes accross as a fairly reliable character to me.
There is a link below to an interview of his on the late late show.
I got his book - it's very very good.

[broken link removed]

His interview is half way down the page.

He also has a free webiste where he updates his positions every week.
www.trend-follower.com


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## kellyiom (5 Dec 2007)

I think it definitely 'works' as a strategy, to a point. But only in so much as value, growth, O'Higgins and everything else 'works'. It must be very difficult to do as a DIY private investor I think although I do know of listed funds which operate trend-following strategies so a small investor can get access through there but the most successful funds in this space are effectively scientific R&D establishments with rafts of PhDs on the payroll. They often do provide diversification as they tend to be positively correlated to volatility.


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## kellyiom (5 Dec 2007)

oh, and a site called www.autumngold.com is a good resource for tracking info on trend followers.


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## Venue (5 Dec 2007)

I read Shipmans book too after seeing him on the Late Late ... the book was very commodities focused but still good and worth reading.

I read Richard Farleighs 'Taming the Lion' just before that it really enjoyed reading that alot more. There is a chapter in it on Trends in Prices. He discusses the pyshology of investing alot. Alot of very interesting stuff in it for the likes of me who is a bit of a novice. Highly recomended!

DDG


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## z106 (5 Dec 2007)

disbanddegaa said:


> I read Shipmans book too after seeing him on the Late Late ... the book was very commodities focused but still good and worth reading.
> 
> I read Richard Farleighs 'Taming the Lion' just before that it really enjoyed reading that alot more. There is a chapter in it on Trends in Prices. He discusses the pyshology of investing alot. Alot of very interesting stuff in it for the likes of me who is a bit of a novice. Highly recomended!
> 
> DDG


 
That's the guy from dragons den ya ? I might buy that today.

You are right in saying that his book was very commodities based.
However - his technical strategy currently sees him with only one position open on commodoties (Gold).

One thing about technical analysis though.
On any site - including shipmans -  it says psst performance is no indicator of future performance.
HOwever - surely this contradicts the very basis of technical analysis no?


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## kellyiom (5 Dec 2007)

fair point but I think there's a regulatory need to do this as well. What I think is more feasible that past performance might help you to predict how other market participants are likely to react to similar events in the future which is along the lines of the Farleigh book which btw, I thought was really good too.


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## Venue (5 Dec 2007)

>That's the guy from dragons den ya ? I might buy that today.

Yep, thats him, trained economist, then worked for Aussie Central bank, then on trading desks, then hedge fund manager in Bermuda, then was able to "retire" to Monaco in his 30s. Excellent book!

>On any site - including shipmans - it says psst performance is no indicator of future performance. HOwever - surely this contradicts the very basis of technical analysis no?

Thats obviously just a standard legal disclaimer to cover themselves from being sued. Wouldnt take much notice of it.

DDG


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## EddieT (5 Dec 2007)

qwertyuiop said:


> Interesting stuff Eddie T.
> 
> SO - in summary,what is teh trading strategy in that book you mentioned?
> 
> ...


 


qwertyuiop,

My strategy is to trawl the market looking for Securities / Indices that match a particular criteria. The Criteria is made up of a combindation of indicators (ADX > 30 and rising, MDI, PDI, stock in pullback from 60 day high, Risk Ratio over 2, etc.etc..) I have researched each indicator and then I have created a formula. When I run the formula against the list of market (filtered - because the Spread Betting company have to list the stock before they will take the bet) stock I get a handful of potential candidates back. 

These are the watches. I review the charts and then decide on the Buy/Sell levels, stop loss etc and place an order. This is called the setup. If the stock triggers I end up with an open position, if not then after a number of days it gets discarded.

I never risk more than 1% of my capital. I never move a stop loss back after it is setup. I do no background checks on the companies as I am not betting on their latest products or End-Of-Year results, I am betting on what the market decides is likely outcome is for this stock. Just following the gang - jumping on when a trend has started and jumping off after it has ended.

If profit is made I use a trailing stop loss to lock in some of the gains before the market turns again.

Stock markets moving side ways kill me. They need to be clear Bull or Bear, then you are just jumping onto market sentiment. 

Keep the losses to a strict limit but let the winners run. In a good trending market the few winners should easily cover all the small losses. 

In other words I am sampling stocks that have good potential for price movement.

As I said before the strategy is not the most important thing, the Risk Management is. It is a serious learning curve that I have no doubt will take years to master but I have the interest so.....

I like* Shipman* ..... I think he has a very valid point about the commodity market. If you apply his 'different phases of a bubble' to the Irish housing market then it makes perfect sense. *With regard to his, only talking about commodities I think the point is irrelevant.* *If you feel the same then you have missed the point of how Trend Following works*. It is called "Trend following" and not "Trend following for Equities only". the same basic principles of Trend Following apply with equities as they do with commodities or indeed buying houses. For example, when Mark Shipman was on the Late Late Brend Crude oil was about $65 a barrel (or 6500 on the indices) it rose to (9725) last week. Yet we all knew it was going to rise. The papers had been telling us for months ...... 3225 points 
Think about it the context of the Irish housing market.... the market starts to go up so you buy based on some fundamental indicators etc GDP, CSO statistics and you hold on until the market starts to turn then you sell..... what could be closer to Trend Following than this...

My indicators for identifying trends are the charts and my formula....

simple.

EddieT


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## chicote (5 Dec 2007)

Interesting stuff folks.

I think Shipmans tactics are sound but would appear to be more long term and larger accounts are needed I feel.

I recommended a book on a different post today and will do so here again - its called 'The Financial Spread Betting handbook' By Malcolm Pryor, excellent book and I am now just starting to put his theories to the test. 

One of his simple theories is based on ADX.
A - Go long when ADX is 30 and above and D1+ is greater than D1- and go short when ADX above 30 and D1- is greater than D+. 
Should state however that additional set up criteria has to be satisfied before an actual bet is placed - too detailed for here, all in the book however.

I raised the idea previously on this site of setting up a small group of spread bettors, say 5 or 6 of us could, as a group, keep in touch and share ideas/results/sucess rates with different stratagies etc - a mastermind group if you like - does anyone think this might be worthwile?


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## tonster01 (5 Dec 2007)

You may (or may not be!) interested in TICN.

They are an Irish based investment club, they do take a fee however, it was minimal..not for me but just another option.

Not sure if they touch on spread betting all the same!


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## z106 (5 Dec 2007)

chicote said:


> Interesting stuff folks.
> 
> I think Shipmans tactics are sound but would appear to be more long term and larger accounts are needed I feel.
> 
> ...


 
I must get that book.

The one thing I liked abput mark shipman was actuall seeing him on the late late show and being able to judge him as much as how he expressed himself as to what he said.

He came accross really well and not some hair-brained 2nd hand car salesman.

FOr that reason I think I may stick to shipman.

I've just started copying what he does.

FOr anyone who wants to see his current open positions goto www.trend-follower.com. It's free !
He updates it every monday afternoon with his new positions for the week.
His positions don't change all that frequently as you'll see.


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## chicote (6 Dec 2007)

EddieT/qwertyuiop,

If its all the same I am gonna add you folks to my contacts list, I will let you know what works for me and what doesnt.

I think it is important to be around like minded individuals.

The goal has to be to make a good living from this, other people do, so no reason why we cant.


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## threeticks (6 Dec 2007)

Has anyone here tried trading the fx market.
Its the most liquid trending market in the world with around three trillion turnover every day.

Added to this there are only a handful of forex pairs to trade and analyze, unlike stocks and commodities which are in the thousands.


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## croker (7 Dec 2007)

EddieT, I would be interested in getting the details of your strategy. Can you post or PM me please?
Chicote as well, if you have any interesting strategies please let me know.
The reason is i usually ignore ADX, RSI and other indicators , just focus on support/resistance lines and volume. I would like to check out any methods using ADX etc. to see how they perform.


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## z106 (7 Dec 2007)

Mark shipmans is very simple.

He uses a 40 week moving average.

HE goes long if the closing prie at the end of a week is highere than all the previous 12 weeks closing prices and if teh price is above the 40 week moving average and if teh 40 week moving average is rising.

HE then sells that long trade if the price dips below the 40 week moving average.

It seems he doesn't go short on trades.


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## croker (7 Dec 2007)

BTW there is a Spreadbetting supplement in todays Financial Times newspaper, some people might be interested.


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## demoivre (7 Dec 2007)

EddieT said:


> As I said before the strategy is not the most important thing, the Risk Management is.



To any aspiring trader this is the most crucial point to bear in mind. I have said it before myself in other threads - money management and perseverance will determine your level of success more than any fundamental or technical approach that you apply to trading financial markets.


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## z106 (7 Dec 2007)

Shipman argues that trading is primarily a psychological challenge.

Once you devie your system you must stick to iy - regardless of big losses/gains !

 really can't recommend his book highly enough.I've read and studied it a couple of times at this stage.

He is very much a long term trader as another poster said.
As in he could hold a position for a few years 
E.g. He's been on gold for ages.


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## EddieT (7 Dec 2007)

chicote said:


> EddieT/qwertyuiop,
> 
> If its all the same I am gonna add you folks to my contacts list, I will let you know what works for me and what doesnt.
> 
> ...


 

I think this is well worth doing. Support is something that we all need particularly when working alone on stuff like this.

With regard to your last point "a good living", I would hope so but only time will tell. Making money is my goal at the moment. If I could make more that I would do leaving it with a so called "investment company" I would be very please. Once i get over that hurdle I will revise my targets.

I would like to take these planned discussions off the public forum though. 

Any idea how we do this?

EddieT


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## chicote (7 Dec 2007)

I have sent a private message to some of you guys with contact details, think the only way to take discussions off line is to use skype or msn, anyone else interested in keeping in touch with other fledging spread bettors, please PM me!


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## Cavalry Trad (7 Dec 2007)

I am new to spread trading, and have found this thread interesting. I have just read Trend Following by Michael Covel, and way of the Turtle and after a few false starts am now trading positive. 

The biggest problem I encounter is with stop losses being hit just before the start of a decent trend - Is this familiar to any of you??

Have any of you studied Vince Stanzione courses, would you recommend ?

I have just also read a book by Louis Navellier - the small book to make you rich. He also runs a website that grades shares with 10 different factors. I have followed a lot of these on paper and about 80% of them are showing positives. Has anyone else used this any comments

Rgds


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## chicote (8 Dec 2007)

Sounds like you are doing very well for someone who is new to SB Cavalray Trad. If you are trading positive then you are mostly there.

I dont want to keep harping on about this book and I swear I am not the author!! But there is a good section in the 'Financial Spread betting Handbook' by Malcolm Pryor on Stop losses - he discusses various techniques for placing stop losses. 

Thanks for the book recommendations, I will add them to the list!

Haven't heard much about Vince Stanzione course? cant give you any thoughts on that I'm afraid. I note Shipmans course in Dublin is fully sold out.


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## chicote (8 Dec 2007)

Sorry meant to ask in that last post - does anybody know of any software that will automatically alert you to any stocks that meets your strategy criteria? i.e instead of trawling through the full FTSE 350 for say Weekly MA that is the highest of the last 40 weeks, is there any software that will allow you to input these parameters on a chosen market and then alert you to stock that meets this criteria?


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## Cavalry Trad (8 Dec 2007)

I use ADVFN software and  live data feeds, which allows you to select companies with 4 12 and 52 week breakouts either up or down if this any use. If you subscribe to level 1 this costs around 35pst per month.

Thks for the book recommendation, I will get this. Other books I have found useful are Market Wizards, and New Market wizards.

I am trying to now use a standard Stop Loss of 8%, but in this volatile market this is sometimes not enough except for the very large cap steady shares.


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## z106 (8 Dec 2007)

Cavalry Trad said:


> I am new to spread trading, and have found this thread interesting. I have just read Trend Following by Michael Covel, and way of the Turtle and after a few false starts am now trading positive.
> 
> The biggest problem I encounter is with stop losses being hit just before the start of a decent trend - Is this familiar to any of you??
> 
> ...


 
If you check out one of my previous posts on this thread it sums up the whole vince stanzione message in 2 lines. It is those 2 lines which you are paying for in his course. 
The bulk of his course is just explaining spreadbetting - i haven't traded hios strategy so i can't comment if it works or not.
I've decided to follow mark shipmas instead.

Vince stanzione is more for shorter term trades.


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## z106 (8 Dec 2007)

Cavalry Trad said:


> The biggest problem I encounter is with stop losses being hit just before the start of a decent trend - Is this familiar to any of you??


 
Ya - stop losses can be a problem.
Personally i don't use them though.

I think teh biggest challenge with spread trading is money management.
i.e. knowing how much to hold back for inevitable fluctuations,how much cash you are prepared to pump in for margin calls etc.

It really does depend on what you are investing in too I suppose.


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## Cavalry Trad (9 Dec 2007)

If I analyse all my trades, I would have been better off without  any fixed stop losses, however that then puts the onus to close a trade back onto the individual, and the psychological pressure of getting that call wrong could be worse.

Without stop losses would certainly stop being bombed out during wild intra day swings.

I have also succesfully challenged my broker on a SB deal, as I was stopped out at about 4% over the price that the share reached during intraday trading. He reinstated the bet at the stopped out price. Anyone else experienced this??


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## EddieT (9 Dec 2007)

chicote said:


> Sorry meant to ask in that last post - does anybody know of any software that will automatically alert you to any stocks that meets your strategy criteria? i.e instead of trawling through the full FTSE 350 for say Weekly MA that is the highest of the last 40 weeks, is there any software that will allow you to input these parameters on a chosen market and then alert you to stock that meets this criteria?


 

Chicote,

Equis particularly their End-of-Day product appears to among the top 3. I use this to create formulas which can then be run against the securities. The problem is that in European there are over 62,000 securities and the SBs only cover a small percentage. So you have to find a way of filtering the list so you don't end up with stocks that you can't bet on.

EddieT


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## croker (10 Dec 2007)

> Equis particularly their End-of-Day product appears to among the top 3. I use this to create formulas which can then be run against the securities. The problem is that in European there are over 62,000 securities and the SBs only cover a small percentage. So you have to find a way of filtering the list so you don't end up with stocks that you can't bet on.


From what i gather some SB companies have contracts on stocks over a certain market cap. For IG index i think it is 500m. If you can check this with your SB company then maybe you could just filter by market cap instead of having to add the list?


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## SkippyOD (13 Dec 2007)

Hey Guys, 
Just a side note on this conversation;

I don't trade FOREX although I have been to presentations by MTI (Market Traders Institute) who are reasonably well known in the states. The reason I went was because I have invested money in an investment club where one individual is trading for us using MTI's platform. He gets pretty good results and being sceptical I went to try and learn some more. I am Irish and living in Jamaica, where this guy is from. He's now living and trading in Turks and Caicos because he doesn't have a licence to trade on other peoples' behalf. Average monthly returns are 10% a month and I've been compounding my interest which has resulted in a doubling of my initial investment in over 7 months. The whole country of Jamaica has money in it and the banks are now gone to war with him as he has taken so much money out of their net. The government are in a tight position because he bank-rolled the currents governments recent election campaign but nobody is paying any tax on the profits that they are making. I have no doubt as well that crime gangs are laundering money through it as well.

The traders name is David Smith and his company is Olint. Google him or MTI and you might find some interesting reading. I have only made paper profits to date as I have not yet tried to withdraw any of it so it may yet end in tears.

I have set up demo accounts with MTI but do not have the time at present to study how to trade properly, instead relying on this individual. A friend who was here with me in Jamaica for a while did the training course in Kinsgton ($2500) over a couple of days and actually met DS. With that the course he gets a free subscription to MTI's platform and one on one advise from a trader. I'm not sure how successful he had been with it.

I've always wondered why there is little or no talk on AAM about forex as its all anyone here talks about, especially given the returns.


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## threeticks (14 Dec 2007)

*SkippyOD*
His website is a bit vauge and none of the links work ???

[broken link removed]


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## threeticks (15 Dec 2007)

for any of you technical analysts here.

Look at the text book ghost (head and shoulders) on the eur/usd weekly.
Doesn't get much better than that....


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## SkippyOD (15 Dec 2007)

Yeah the Olint website is really not helpful at all but if you googled it and David Smith then you may pick up some articles about the fund and returns. This website below may be of more use, I believe its the platform that he uses to trade on. 



I have set up demo accounts but haven't really got started into it seriously. At the moment I have money invested in this Olint club and the returns are better than I can probably realise on my own anyway. My only issue is whether it is actually real, its not a front to launder drug money, and that I can actually get it back out again. Saying that at least 30% of the workforce in the company I work for in Jamaica are in it someway or another. There are also people selling houses and investing the entire amount in it with greed taking over their senses.


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## limerickmick (9 Jan 2008)

chicote said:


> Sorry meant to ask in that last post - does anybody know of any software that will automatically alert you to any stocks that meets your strategy criteria? i.e instead of trawling through the full FTSE 350 for say Weekly MA that is the highest of the last 40 weeks, is there any software that will allow you to input these parameters on a chosen market and then alert you to stock that meets this criteria?


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## limerickmick (9 Jan 2008)

chicote,

interested in your post as i am a novice spread bettor for 2 months . i have heard of a trading system called elmtrader, further details can be found  on their website www.elmtrader.co.uk. 

I have read Malcolm Pryor's book but am interested in discussing strategies with others on this website and particularly if anyone could recommend trading software.


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## z106 (9 Jan 2008)

WHat is the story with malcolm pryors handbook to spreadbetting?

A lot of you seem to have read it.

WHat is the main theme of the book?
Presumably it outlines the basic mechanics of spreadbetting.

Does it recommend trend following?

If so,what are his buy and sell signals?


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## daves (9 Jan 2008)

qwertyuiop said:


> WHat is the story with malcolm pryors handbook to spreadbetting?
> 
> A lot of you seem to have read it.
> 
> ...



Have ordered it off amazon today as i cant seem to get it in the bookshops around Cork.
Read shipmans book and just building a knowledge base so i can get up and running. if any of you guys are starting a "shared knowledge" group, id appreciate it if you would include me.


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## MickieD03 (9 Jan 2008)

hey daves, we seem to be in a similar place on the learning curve... I was impressed with Shipmans book and jumped into some of his commodities on Rabo Funds. Done quite well until I realised I was exposed to sharp down turns (no stop loss allowed). Got out with 10% profit after 2 months and just before a sharp down turn. I'm now concentrating on learning more on Trading and especially Trend Following. Like you I've been impressed with the recommendations for the FSB Handbook and bought on Amazon today. I've read alot of Van tharp, Covell and The Turtles. I'm doing the Shipman seminar in Dublin. Also there are free tuitions on spread trading coming up in Cork by WorldSpreads and Delta Index (don't know if Delta's is open to public but Worls Trade is). Check out their web sites. I'd also be interested in any sharing of knowledge / learning experience, all be it from a novice/beginners perspective.


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## ccraig (9 Jan 2008)

have been looking into this myself. Has anyone tried out the paddypower platform yet. Any opinion. It seems very user friendly however spreads may not be that good.
Interested to know opinions


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## Zoran (13 Jan 2008)

qwertyuiop said:


> Mark shipmans is very simple.
> 
> He uses a 40 week moving average.
> 
> ...



Did you use any SW to back test this simple strategy?
It should be easy and less costly to even buy good trading SW for e1000 and test that strategy then go and try spread betting blindly.

OK, I will save you money. 
If such simple strategy works what do you think pros who evaluating millions of different strategies to beat the market will do with it?

If you have a great strategy no way you will share it with anybody else.

Also do not forget that active trading is the lost game in most cases over the long period of time.
Even pros and active managers could not last for many years.
Search about the smartest investment team did and how they finished (search LTCM on google) :
http://en.wikipedia.org/wiki/Long-Term_Capital_Management

Hey, nobel prize winners and what happened to them.


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## Zoran (13 Jan 2008)

MickieD03 said:


> hey daves, we seem to be in a similar place on the learning curve... I was impressed with Shipmans book and jumped into some of his commodities on Rabo Funds. Done quite well until I realised I was exposed to sharp down turns (no stop loss allowed). Got out with 10% profit after 2 months and just before a sharp down turn. I'm now concentrating on learning more on Trading and especially Trend Following. Like you I've been impressed with the recommendations for the FSB Handbook and bought on Amazon today. I've read alot of Van tharp, Covell and The Turtles. I'm doing the Shipman seminar in Dublin. Also there are free tuitions on spread trading coming up in Cork by WorldSpreads and Delta Index (don't know if Delta's is open to public but Worls Trade is). Check out their web sites. I'd also be interested in any sharing of knowledge / learning experience, all be it from a novice/beginners perspective.



You need to have provable (back tested) trading strategy with an edge to consistently win the game.
You are in the profit only due to the luck and nothing else.

If you entered the position just before that sharp down you will be wiped out in probably 1 day.

Academics proved that active trading and market timing is not for individual investors. They also proved that active management pros are making lower return then the market index (e.g. world index or S&P500 or whatever index they are benchmarking against)

Save your time and money and go away from the hardest way to earn money (futures or spread betting and options).

Best of luck.


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## croker (13 Jan 2008)

> have been looking into this myself. Has anyone tried out the paddypower platform yet. Any opinion. It seems very user friendly however spreads may not be that good.
> Interested to know opinions


You will probably find that many SB companies are in fact very similar in terms of the user interface, software and features you get.
In terms of spreads I guess the bigger companies in the UK have smaller spreads. These companies also carry way more contracts than the smaller (Irish) companies. 
Then on the other hand, the UK SB companies only accept sterling(£) and dollar ($) for certain contracts whereas the Irish firms take everything in euro (€). But your account is in € even in the Uk companies and you can convert the currency each day so it is less exposure than you would think.


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## Zoran (13 Jan 2008)

qwertyuiop said:


> Mark shipmans is very simple.
> 
> He uses a 40 week moving average.
> 
> ...



Use the trading SW to check how valid is this strategy.
Why risk money on something not tested on historical data and across many markets.

Such strategies and many more are tested in academic world and they are not beating buy&hold market index strategies.

Active trading is mostly destined to underperform their benchmark index and that is proved.

This is not the game individual investors are winning too often and you are against pros.


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## z106 (13 Jan 2008)

Zoran said:


> Use the trading SW to check how valid is this strategy.
> Why risk money on something not tested on historical data and across many markets.
> 
> Such strategies and many more are tested in academic world and they are not beating buy&hold market index strategies.
> ...


 
Shipman claims it is back-tested and also claims to have been making money from this strategy for years.


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## Zoran (13 Jan 2008)

qwertyuiop said:


> Shipman claims it is back-tested and also claims to have been making money from this strategy for years.



I do not think that anybody can follow his exit strategies - he mentioning 4 exit strategies.
Which one you are going to choose for what position?

Some of them are very descriptive so hard to test them
How the hell he tested something that is not possible to describe mathematically?

Would you tell me his exit strategies please so I will test the results myself?
Tell me also what securities you want me to test the strategy against?

I assume the idea is to go on his seminars to pay more money and he will teach you how to do it successfully.

I really doubt it.


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## Zoran (13 Jan 2008)

Just to add this:

I am not claiming that Mr. Shipman did not or will not make the money in spread betting or any other way.
But that does not mater to me or you.

What mater's is that I do not see how to use his methodology from the book together with any kind of investing (not just spread betting) in my favor.

I will rather trust academics, well known books and proper strategies to investing.


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## chicote (13 Jan 2008)

We better all listen to Zoran.....forget about investing, give up on any dreams you might have, do not even think about tyring to learn and grow cos u never will. Keep the money safely tucked under the matress!
Could you be any more of a wet blanket? we all know the risks involved and i dont think anyone here is remortgaging in order to fund spread bets.
Shipman is a self made multi millionaire, thats known as 'Proof is in the pudding'

It is possible to make money trading/spread betting and thats mainly because even the pros are wrong more than they are right and anyway most people trading are not pros. It about limiting the amounts you do loose when you are wrong and unlimiting the amounts win when a trade goes your way.

Keep on learning and trying people.


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## Zoran (13 Jan 2008)

chicote said:


> We better all listen to Zoran.....forget about investing, give up on any dreams you might have, do not even think about tyring to learn and grow cos u never will. Keep the money safely tucked under the matress!
> Could you be any more of a wet blanket? we all know the risks involved and i dont think anyone here is remortgaging in order to fund spread bets.
> Shipman is a self made multi millionaire, thats known as 'Proof is in the pudding'
> 
> ...



Sorry but I did not say you to stop investing.
I am telling only that one should know the risk and reward and that 
futures and options markets are no win game for individual investors in probably 99% of cases.

If you have the trading strategy with an edge to make money trading go for whatever you want, even spread betting.

I also started talking here because in that book there is no trading strategy.
It is not described fully as it should be to somebody to use it.
If you take 100 of us to read these 10 pages on the strategy we will all have our own interpretation.

I am myself invested in portfolio of passively managed indexed funds long term buy&hold in pension account.
In my tax account I have similar positions but in ETF's again passively managed indexed funds.
This is what trillion of dollars are in and where the smart money is.
This is what is academically proved and well known names and investment groups are focusing their attention.
Go to  forum and you can read about it and post questions. You will find on that forum recognized book writers discussing how to make the good portfolio, also references to academic work and books.
Even old timer Bogle (founder of Vanguard - famous company managing trillions in such funds/ETF's) posting there:
http://www.investopedia.com/university/greatest/johnbogle.asp
Even Warren Buffet is saying that for individual investors are indexed funds.

Trust whoever you want. Up to you.
It is all risk and reward game.

Would you rather have 1m in pension with 90% certainty or 2m with 50% certainty?

At least do some additional readings and you will not regret.

It is better to ruin your dream of being rich fast now then when it is too late.
I agree if this is the money you will otherwise spend on drinks go for it.
If it is your pension money then think twice and say no no to spread betting or futures/option trading if you do not know what it is and who you are fighting on the other side.

My two cents.


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## z106 (1 Feb 2008)

Ok - I'm gonna bang one out here that may make me look very stupid.

But anyway - here it is.

Point 1
Basically - at any moment in time, I presume it is fair to say that the price of any liquid asset is equally likely to increase as to decrease yes?

Point 2
Also - It is widely accepted that it is very difficult to pick the top (or bottom) of a trend -and if someone does then it's just luck correct?
(Lucky in the sense that they have maximised their profits )

So - If you take this second point then it could be argued that when an asset is trending,say,upwards,then the likelihood is that should you choose to sell at any point in this upward trend,then it won't be the top - unless you are very lucky ! 

And if the likelihood is it's not the top - then does that not follow on that it is more likely rather than less likely that the price will rise? - which in turn negates my first point !

So is this not reason enough to follow the trend?


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## stevedent (29 Aug 2011)

*trend following system*

There's an Irish company called Spread Select that provides members with trading advice based on a trend following system.  I think they are at spreadselect.ie


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