Paul’s Journal

[PaulBailey]

Thanks Kate,
not sure who else reads this, but I have been thinking about how to scale into my system.

Have started v small – 5x $2.5k positions. Will add more as I go and gain some confidence that the system works.

I have a question as to how others have done this – add to all current positions at a particular cash balance would be one option vs buying single bigger positions as new trades are triggered.

Bear in mind I’m running a 5 position ASX 100 momentum system, so individual stocks will / may remain in the system for several weeks or even months. Of course can be shorter.

Not sure if Ive explained that correctly.

PB

[JulianCohen]

There is a couple of ways to do this Paul.

One is wait for new signals, but that could take a while as you have indicated with your description of the strategy.

The other way is to buy into all the positions the backtest tells you it is holding, but to be aware that some of those positions could be well into their trends, even at the end of them, and when at the end of a trend you will almost always lose money as the price reverts back towards the natural exit of the strategy. In trend following you are always picking up the middle part of the trend, not buying at the low and selling at the top. So as long as you are prepared to go into drawdown should that occur, then buy the whole lot now.

After all, you might be at the end of a trend or the middle of a huge one…you just don’t know.

[Nick Radge]

You want to align your portfolio with the backtest as soon as possible. Buy a portion of all open positions then add as comfort grows.

[PaulBailey]

Thanks Nick, yes that is the way I have ultimately gone.

End of week 1 summary

Week ending 8/4/22 – -5.4%

1. Bought into 5 positions Monday am at the open, been interesting to watch them wax and wane through the week according to my custom (but not that funky) ranking system.

2. End of the week I am -5.4% which is within expectations

3. No changes this coming Monday – my lowest rank held share is at #7, my system sells when the share exits the top 10.

4. Working on another system that will allow me to trade an unrelated market – I’m sure this is familiar to all of you.

Cheers everyone, have a great week.

PB

[PaulBailey]

End of week 2 summary:

Month to date -6.0%

A shorter trading week – had some ups and downs and finished about even for the week. The top 5 remain the top 5 – so no trades on Tuesday.

Still trying to figure our how to make a R1000 weekly system without much luck in finding the right combination.

[Nick Radge]

Send what you have for the R-1000 through to me Paul

[PaulBailey]

End of week 3 summary:

Month to date -10.0%

Another shorter trading week – this time Easter Monday – leading into ANZAC Day – same for everybody trading the Australian market.

3 week periods with a -10% return are actually a <1% occurrence in my backtesting, but also perhaps representative of what happens at the start of running a system when perhaps I didn't get the best timing for the selected stocks as would occur when a system is up and running.

All in all, everything is OK.

[PaulBailey]

Month end – April 2022

OK, firs month trading my weekly ASX 100 momentum strategy.
Finished the month -11.6%.

Good news is that I’m starting small whilst learning the ropes, so -11.6% is -$1594.

I’m also enjoying reading through everyone else’s journals and working my way through the group calls.
Particularly enjoying when all of you work through an issue together.

Cheers everyone,

PB

[PaulBailey]

End of May week 1

Another negative week for me – -3.4%. Market filter has switched to cash, so selling the portfolio tomorrow morning.

PB

[PaulBailey]

…. and just to note I am now 100% cash.

[PaulBailey]

Pretty good week – sold out on Monday, so a small loss for the week.

Weekly ASX 100 Portfolio, including costs, is -16.6% since the start of April.

In other news, and just to demonstrate to myself how tiny stocks can move in a way counter to the broader market AYA, one of my Round A investments was +60% this week (albeit on very modest volume). Finished at $1.03, still down from listing at $1.35 6 months or so ago.

Just documenting my thoughts, as always.

[PaulBailey]

Hi everyone,
June update – Nil – 100% cash.

PB

[TerryDunne]

Nice! Well done Paul.

[PaulBailey]

Just a short post to note I was fully in cash for the month of July 2022, and the system turned back on last Friday triggering a buy on Monday.

Back in the market in a modest way.

[PaulBailey]

Also, whilst I’m here and just a short explanation of relative silence of late, resigned from my job last month and now happily doing contract work.

[Author]

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