Do you follow the robots?

[Pascal]

I received the following question:

Are your trades placed before the market opens or during market hours; moreover, if the market opens above the signal entries as it did yesterday, do place your entry at the market?

When the market opens below the entry price of a long trade, I enter at the open.
Otherwise, I try to follow the robot signals: entry price/stop loss.
Regarding the exits, i sometimes exit partial positions when the market is extended (selling at a strong resistance).
All in all, my discretionary decisions are doing worst than if I had not taken them. So I better not write about them.



Pascal

[Timothy Clontz]

Not every broker is the same, but some (like etrade) are better at negotiating best prices at gaps when the gap is in your favor. TDAmeritrade does not seem to do as well.

I'd suggest for the typical user to pay attention to how well your broker takes care of your premarket limit orders on a gap. If you do a limit order and see a gap, but your order is executed at the limit (i.e. Robot) price instead of the gap price, consider another broker.

[mingpan.lam]

Hi Pascal,

Will you update the robots during the trading hour?
Also, when you place order, will you place stop loss order together?

Cheers,

Ellis

[Neil Stoloff]

When the market opens below the entry price of a long trade, I enter at the open.
Otherwise, I try to follow the robot signals: entry price/stop loss.

Pascal,

Isn't it possible that a trade signaled by the robot EOD will never actually be entered (because the target entry price never materializes)? If so, has this ever happened to your knowledge?

Thanks,

Neil

[Timothy Clontz]

If it gaps away from the Robot price today, they reset it for tomorrow -- until it hits.

Then they KEEP resetting it for those who missed it the first time :-)

I'm a real fan of the simplicity of it.

[Neil Stoloff]

If it gaps away from the Robot price today, they reset it for tomorrow -- until it hits.

Right -- but what if the signal reverses before the target entry price -- initial or subsequent -- is hit? Is it recorded as "no trade"? This is just one aspect of the robot's hypothetical track record that I'm trying to reconcile with real-world realities (or, er, hypotheticals).

I value the simplicity of the robots too, Tim, but am reminded of something Warren Buffett said about successful investing: "It's simple, but it's not easy."

Cheers,

Neil

[Pascal]

If the target entry price is not hit, there is no trade and hence there is no record at all.
If the target entry price is hit and the signal chnages at the end of the day, then the trade is closed and recorded.


Pascal

[ChrisC]

Pascal,
Today's setting for IWM looks strange to me. According to your table, it shows the characteristics of LONG settings (-0.75<LT<0.75 and ST>1%) but instead, the robots took a NEUTRAL stance... Could you clarify?
ChrisC

[Neil Stoloff]

Thanks, Pascal.

I have been compiling a bunch of "what if?" questions like that. I like the idea of posting answers along with my questions, using as my guide, "What makes the most sense?" That way you won't have to bother spelling it out for me. Instead you can just type, "Yes, that's right." Or you can tell me why my logic is flawed, which has been known to happen.

Cheers,

Neil

[Pascal]

Pascal,
Today's setting for IWM looks strange to me. According to your table, it shows the characteristics of LONG settings (-0.75<LT<0.75 and ST>1%) but instead, the robots took a NEUTRAL stance... Could you clarify?
ChrisC

You are right. I should have programmed it to say "Neutral long term and relatively strong short term".
I just did.


Pascal