In this seminar, Bob focuses on using the trading equity curve to improve the performance of mechanical trading systems. He talks about the primary types of mechanical trading systems and what causes them to experience drawdown periods. He discusses the best types of trading systems to use for different kinds of tradable items. You will learn how the moving averages of equity curves, combined with the equity curves themselves, can serve as a money management technique to reduce drawdowns and even turn losing periods into winning periods.
Bob uses several examples of mechanical trading systems to show how this technique can quickly identify changes from congestion periods to trending periods and vice versa. He also discusses how to adjust the equity curve for any phenomenon that causes account drawdowns. Bob explains how applying his techniques in conjunction with several of the systems he discusses can signal when and how to place limit orders, thereby significantly reducing slippage.
Bob McCullough writes the frequently quoted newsletter Investotalk and is president of Liberty Research Corporation, which produces and distributes Investograph Plus, a technical analysis and charting program. He has spoken at many meetings of computer-oriented investors, and recently published his book, A New Look at Technical Analysis. Bob graduated from the University of Texas with a degree in chemical engineering. He soon became interested in computers, and joined IBM to develop real-time process control and laboratory automation computer systems. He became interested in applying some of the pattern recognition techniques used in computerized laboratory analysis to the stock market when he read Hurst’s The Profit Magic of Stock Market Analysis. Bob combined his experience in trading, programming, and engineering in the development of Investograph Plus. In this work, he has developed several unique indicators and mechanical trading systems.