Beating the Financial Futures Market: Combining Small Biases Into Powerful Money Making Strategies
$24.12
| Author(s) | |
|---|---|
| Pages |
269 |
| Format |
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| Published Date |
2006 |
Beating the Financial Futures Market provides you with a straightforward, historically proven program to cut through the noise, determine what bits of information are valuable and integrate those bits into an overall trading program designed to jump on lucrative trading opportunities as they occur.
Introduction:
Written by veteran commodities trader, systems designer, lecturer, author, and Chicago Board of Trade member, Art Collins, this comprehensive trading handbook details: Guidelines for overcoming dead-end discretionary trading “insights” to focus on market-tested, mechanical trading rules and knowledge;
The four rules of prudent optimization, essential for identifying the best performing variables within your formulas; Eight consistent biases that, when followed, can lead you to more reliable and profitable trades; Statistically verifiable strategies for combining – and recombining – specific indicators based on prevailing market environments; Actual Tradestation (registered) summaries, showing in black and white which concepts worked and which didn’t, and when, and why. The back-roads of financial futures trading are littered with failed geniuses, traders who spent their days trying to outthink the markets.
Beating the Financial Futures Markets will show you how to simplify your trading program by strictly adhering, 100 percent of the time, to a focused roster of mechanical trading techniques. It will help you remove much of the difficulty from your trading day by developing a disciplined, turnkey system and letting the system do the work – leaving you to simply make trades as specified by your system, institute the necessary safeguards, and dramatically improve both your percentage of winning trades and the bottomline profitability of those winning trades.
Contents:
- The Problem with Non-Mechanical Trading
- Understanding the Numbers Game
- But Why Doesn’t Spontaneous Trading
- Close versus Closing Averages
- The Four Rules of Prudent Optimization
- Two-Day versus Five-Day Averages
- Fifty-Day Order of Extreme Highest/Lowest Closes
- Combining the First Three Basic Indicators
- Fifteen-Day High/Low Averages
- Combining All Five Indicators
- Two More Open-to-Close Biases
- Three-Day 20 Percent Support-Resistance Indicator
- The Pros and Cons of Price Targets (Featuring Another Effective System)
- Other Applications of the Two High/Low Exit Technique (Live! As It Happens!)
- On Further Optimization, Market Drift, and Virgin Data
- Index Biases —Days of the Month (Or How to Beat the Stuffings out of the Bellwether S&P Indicator)
- Intraday Day Trading Part One: The Most Significant Price in Your Arsenal
- Intraday Part Two—The Switch (Can Promising Trading Environments Be Anticipated?)
- When It Gets Extreme—What to Do after Five Closes in the Same Direction
- Another Look at N Day and an Alternative Stop Approach
- Taking On the Axioms Part One— The RSI Indicator
- Taking On the Axioms Part Two— The Reversal Day Indicator
- Potpourri—Systems as I Discover and/or Rediscover Them—In No Particular Order
- A Final Step-by-Step System Construction—The Six Signal Indicator
- Combining the Non–Either-Or Indicators
Beating the Financial Futures Market: Combining Small Biases into Powerful Money Making Strategies By Art Collins pdf
11 reviews for Beating the Financial Futures Market: Combining Small Biases Into Powerful Money Making Strategies
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Sofia Lucero (verified owner) –
We backtest well-known indicators, such as moving averages, against various futures.
There are a lot of tables, so it is recommended for those who want to roughly know the effect of indicators.
I think that if you try to backtest the same with other assets using Trade Station, etc., you will get a better understanding.
Personally, I have deepened my understanding from the point of view of what indicators can be effective to have expected values that are commensurate with costs.
For the first time, you can know the effect of the indicator, and for
those who are more detailed, I think that it will be useful in terms of how the expected value is different if you enter stop and limit.
There are many backtest tables, and even those who are not good at English can read without any difficulty.
Tobias Gates (verified owner) –
This book is full of good ideas, also none of these are new. The author’s excellent work in back testing all the ideas in this book deserves praise.
THE BOOK IS GOOD VALUE.
Wade Taylor (verified owner) –
I bought the book by mistake, please note that it is not a book on “futures” as in Forex but about stock trading systems. I found the book a bit boring with many setups that are all mechnical; this book might works for some but not for the discretionary traders…and if I ever hear another menacing words about fears and greeds just scare people into reading, I might as well close the book and throw it in the corner. All in all, this book might serves your purpose just like the 2 comments written above.
Lian Stokes (verified owner) –
The book is quite slim if you notice that there are many tables, and the TS code begins at page 205. The strategies are so simple that the TS code was only useful a few times for confirming the rules that were not completely clear in the text.
The book shows a series of “strategies” and some backtests.
The problem is that all these strategies are extremely simple and very similar to each other. They often involve daytrades, buying the open and selling at the close, or entering on stop at the open +- a buffer. For the majority of the strategies, no slippage and no commissions are taken into account. The problem is that in the real world, they often turn daytrading strategies from apparently good to losers. The author does point out slippage and commissions, but often forget about them in the second half of the book.
The author is easy to please. Many strategies give drawdown of more than 50% of the profit for the confirmation markets. I would not find that a validation, particularly after looking at the equity curve (I did test many of the strategies of the book across many markets).
Of course, robust often means simple, but another problem I find is that all the techniques in the book have been optimized for the period used and often for the selected indexes. For example, a system was reasonably performing from 2001 to 2005 in the book. I tested back from 1995, and the out of sample simulation did not give good results. Using European indexes did not show so nice result as well (I confess I am not as easy to please as the author). The author never looks at the difference between short and long signals. Of course, if the concept is strong, there should be no differences. For the indexes, the fact is the simulation of the combined indicators strategies show that longs are doing well in bull markets and bad in bear markets, the opposite for shorts, of course. Interestingly, the strategy appears to behave reasonably well (without slippage, commissions) only in the optimized time frame. Also, the analysis of the equity curve shows that, in some cases, most of the profits are made in a limited amount of time and the rest of the time it is not productive or counter productive. These very simple strategies heavily rely on optimization.
The concept of strategies aggregation to enhance the probability of success is of course good, though not new.
To summarize, I find the strategies quite weak (after slippage, commissions) and the tests too limited. However, the book is still a very good read for those really wanting to begin in mechanical trading. Many traps of mechanical trading are described. The author does not mislead the reader, though I find him easy to please for the test results.
Paula Huynh (verified owner) –
It’s interesting how simple Art Collins’ systems are, and yet, if we can believe his results, they produce impressive profits anyway. There’s no reason to doubt them: Art not only offers verbal assurances, he invites us to test against his results for ourselves. He fully discloses every necessary rule and formula along the way. Some of this book might be hard for neophytes to follow, but with a little work, there should be plenty within the text that’s workable for everyone. Maybe one of the best books of this type I’ve ever read.
Legacy Frost (verified owner) –
There are two things I love about this book. One, the author backs every contention with historic performance summaries. How many investment books do that-like maybe one in a thousand? Second, you just know the author’s expertise is genuine. Read Art Collins’ daily commentaries for Elite Trader and Tiger Shark, or any of his magazine articles. He earns his living trading-he’s therefore, unlike most self-appointed gurus, actually walking the walk.
This is really exciting stuff! I’ve already started testing his ideas on my own.
Demetrius Myers (verified owner) –
I think this author is probably a good systematic trader but his style of writing is very hard to follow. I had to read and re-read whole sections and still didn’t completely understand them. I have read other books on this subject that are much easier to understand because the author is able to clearly describe what their point is.
Corinne Valentine (verified owner) –
Lots of trading ideas and Easy Language codes! Art Collins has a unique way of testing ideas or market biases. I highly recommend this book to every mechanical trader or system developer
Miranda Gilbert (verified owner) –
This book is a frustrating read. While the system is good (and I’m making money with it), the author’s description is poor. Very frustratingly, the system is described in narrative, instead of pseudo-code, and there’s a long of ambiguity. Does the “Two Day Close” mean the close two days ago, or the average of Day1 and Day2 close? Quoting from his book, “Buy tomorrow if today’s close was lower or sell short if it was higher.” If the close was higher that what? It doesn’t say! He describes half one point in a chapter, and then completes the description in another chapter.
So don’t expect that you’ll be able to take the descriptions in this book, and convert straight into code. You will need to read and re-read, and then make a few educated guesses to fill in the gaps.
Good methodology, but poor writing.
Felipe Winters (verified owner) –
I have used this book many times since I bought it. It never fails to give me a new trading idea, or help me put a new wrinkle on some strategy I am developing. This is one of the few trading books I regularly take off my bookshelf and use!
Lydia O’Donnell (verified owner) –
This book takes 10 biases, explains their reasoning and gives quantitative back-up for how each does in a Tradestation simulated back-test. Art is a successful mechanical trader so you get a look into how he thinks and how he interprets the results. Each bias is relatively simple and demonstrated to have a small but definable edge across multiple markets.
The aspect to this book that is most interesting is how to integrate these various small biases into a master composite ‘index’. As Bob Pardo writes in the Foreward section of this book “indexing can be very powerful… It can be a very effective way to ‘summarize’ large amounts of complex information.”
I find that if I can take just 1 or 2 practical ideas from a book, it is a good book. This book did more than that — it got me started on ‘indexing’ for individual stock lists and sparking new directions for me. I highly recommend this book to anyone — but especially those with some kind of competence in quantitative methods to trading.