ETF SWING & DAY TRADING

[hiker]

A few points:

1) The only reason the system return is so high is because you've included the bubble top of an incredible bull market. Take that away - just look at the returns from the last 5 years for example - and they will be considerably lower. Expecting to get the system returns you've posted is equivalent to hoping the 90's bull market repeats itself (and good luck to that).

2) The system % max drawdown is about the same as the system return. What this means, in effect, is that when a trader hits the max drawdown it's likely that they will be underwater for over a year. (Do the math... if your system return is 40%, and you experience a drawdown of 40% then - assuming you get the system return - it will take well over a year to climb out of that hole.)

I have traded several mechanical systems for years. None of them have a system return / max drawdown ratio of less than 3. To trade a system with a ratio less than that is to take unacceptable levels of risk.

And risk management is what good trading is all about. It is also what I think you continually ignore about this system. You appear totally focussed on return - however it's quite easy to get excellent returns but to do so ignoring risk is suicidal.

Given your previous comments (and especially several declarations that this is the "holy grail") I'm skeptical that you will take my comments seriously. But I do hope that others who have followed this system will take pause. To those readers I would emphasize that this is NOT a holy grail, and if something sounds too good to be true.....