Recoup, 30 Day Trades and Forex

Posted on Oct 8 2015 - 7:35am by Dan

So how is ‘The Sharpe Report‘ progressing?

Earlier this year … I got my face kicked in by the market.  In my stock, futures and options account, which is what ‘The Sharpe Report‘ is based off of, I hit the highest drawdown I have experienced since 2007.  About 13%.

Much better than some of the big names out there.   But for me, it was still a pretty rough six months.

Now I have this little rule when it comes to drawdown.  If I experience too much of it, I begin to use a very defensive strategy that works well to ‘recoup’ my losses.  And for the last few months, we have been sharing both that strategy’s mechanics, and how it works in real time with clients.

It’s done pretty well …

10_08_15_SharpeTrade_SR Results

We still have to re-coup from the losses so that I will be back up to 30% in total returns.  But as the market sank lower … we did not.  And if the market rallies, the strategy tends to do very well.

Here’s the thing.

With that particular methodology, there is not a lot to do. We adjust it every so often.  It works, and works very well.  But there is not a lot of ‘action’.

So something that we have been doing in our spare time is demonstrating another method of trading.  And discussing how it works.  This method of trading is basically looking for longer swing trades.  So, think of a swing trade, that’s not quite a position trade.  But it’s getting close to that sort of time-frame.  A trade that lasts somewhere around 30 days.  Possibly longer.  But that is the time-frame by which we will review these trades.  We’re calling them, appropriately enough … “30 day trades“.

Now these trades may last more than 30 days.  This is the second month we’ve been running “30 Day Trades“, and the trade this month, was the same as last month.  But we review the trade, every 30 days or so, and decide what will be the trade for the month.

We find that most folks who have a 9 to 5 day job find it easier to follow along with a 30 day methodology, than watching someone day trade a particular market.

As we stated above … ‘The Sharpe Report‘, basically deals with Stocks.  My Forex trading is a completely separate beast.    But in truth … I’ve also been toying with the idea of discussing Forex to a greater degree.  Because laterly, I am kicking it on the Forex route …

25 Trades Forex Risk Reward Ratio 55 Accurate

So we have a defensive strategy in play … we’re demonstrating trades that only need to be reviewed every 30 days, and we’re looking at the possibility of adding Forex to the mix …

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