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Re: hiker post# 13470

Saturday, 12/03/2005 2:47:27 PM

Saturday, December 03, 2005 2:47:27 PM

Post# of 79025
A 50% drawdown in one year is not the same as a 50% drawdown every year.

If you want the ultimate in low risk trend following, take a chunk of cash, through it in treasuries, use the interest to buy deeply OTM puts and calls. Eventually you'll catch a Black Monday or surprise Friday afternoon rate cut and make a zillion bucks. But even though the wins are (potentially literally) a million times bigger than the lossers, and even though the drawdowns are nearly zero, the sub-1% hit rate will drive the vast majority of speculators slowly insane.



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