What A Differece A System Makes!

What happens when you create a plan and actually stick to it through the good and the bad? What happens when you have a system with, what we call, an "edge"? You take some heavy losses at times, but because of the mathematics of probability and historic testing you can trust the system enough to follow it right into positive territory. This is exactly what trend following has given me (also known as "Turtle Trading").

It brings up the discussion of whether good traders are born or they are made. I say, made. Good investors can be born. Think Warren Buffett. They just have an inate ability to look at something and determine hidden value. Look at Buffett's early childhood. He bought a pinball machine with a friend at the ripe age of 12 and with the profits from that machine, he bought 3 more and placed them in barber shops around his hometown. I sure wish I had that built in ability to see value where others see, in this example, a game. However, I can learn the discipline involved in being a trader with a system. Some people have that ability to follow discipline rigidly. I do not, but I am learning and becoming a better, more disciplined person. When dealing with money, those who are born with discipline are tested in following a system that could spell financial ruin. Therefore, even these traders have to be "made".

With all this said, I'll tell you a little about my current portfolio. In the 3 weeks it has been active, I have come up with a ~5% gain. I've held ~60 total stocks of which I still hold around 50 of them. For this exercise, 50 is my limit. I'm currently working on a program that will calculate mean, median and other stastics of my current portfolio (and perhaps all trades). After another month of trading, I'll start posting some picks and create my own stock picker site. Hopefully, people will start reading then :-)