Campaign Trading is a book for speculative traders, retail or commercial, not niche traders or arbitrageurs. Speculative traders may be trading from an intensive knowledge of their market or merely from the action. Their horizon is usually short, but in some industries (copper comes to mind) may extend to four or five years. Speculative traders aim to profit from price fluctuation, not hedging. It follows that the more fluctuation they may exploit, the better their chances.
In the trading books of the early part of the century, writers would grandly refer to a campaign of trading, a series of battles and skirmishes to accumulate and eventually distribute a position, long or short, Today, while large operators still assemble and disassemble large outright positions, grand campaigning may be hindered by the capacity of the markets. Many, if not most, money managers are locked into quarterly comparisons of performance that prevent a longer view and focus on managing many issues. The field of play for the smaller speculator therefore is not often occupied by predatory competitors seeking to destroy him.
Running a trading campaign is not like executing a single trading rule over and over, and this book doesn’t describe running a campaign Instead, this book shows by example how to build the base for campaigning: the measurement techniques to use, how to test trading rules for effectiveness, and how to pick the types of trades you will use in future campaigns. Think of this book as an example of preparing a campaign of trading.
- Trading the Trend
- Handling the Bad News
- Piling On: Exploiting the Trend
- Reversing Bad Trades
- Switching Modes: Trading Ranges
- Reversing Out of Ranges
- Minimum Favorable Excursion
- Shifting the Odds: Using Options
- Conclusion to Campaign Trading