One system until it's consistent
Every system has drawdowns. Hopping to a new one each time the current one hurts guarantees you never learn any of them. Get one consistent first, then build.
There are different systems, but all of those systems have their own drawdown periods, have their own faults. Before I go trying to optimize — and by optimize I mean bounce around systems — I need to get this one down first. Consistent in my interpretations, consistent in my executions, and then we build from there once we observe consistency in ourselves.
— from my October 14 session notes
Why it's a principle
You can't judge a system you haven't run consistently. If the rules change every few weeks, the record measures the switching, not the system.
So changes here go through a process: an idea gets marked testing, the trades that test it are tracked, and it only becomes a rule when the record says it helps.
Discussed in
Related
- Market regime filter (SPY & QQQ)Before buying individual stocks, check SPY and QQQ against their 8, 21, and 50-day averages. When they're below, stand down or only trade the indexes. When the 21 sits close above the 50, don't buy pullbacks.
- My own trigger, every timeAnother trader taking a position is information, not a reason. Every entry needs a trigger of my own beyond a stop.