Traders' Roundtable

LOOK AT THE AMOUNT OF STOCKS MAKING NEW HIGHS. The number keeps growing. The difficulty is that there3 is a much larger ratio of Hh then Ll. So be careful not to strap on too many postions. The position sizing aspect of the turtle rules printed by c.f. is a good start. A correlation Matrix is equally effective in determining whether to buy one or the other. If their correlative select the better performer. I have also reduced risk for stocks trading between $1.00 to $5.00, to 1% of portolio size but remember pyramiding occurs very quickly. you might be loaded in the same trading day.

20 h 1269
20 l 384

65 h 983
65 l 78

100 h 934
100l 53

52 wk h 835
52 wk l 11

If there're so many stocks making new highs, how to pick to ones to trade?

I asked a similar question to Mike after my purchase of the system. The reply was mainly based on fundamental information. Are these relevant in turtle rules? If not, how to pick the right ones to trade given that there are so many stocks making new highs?

Thank you very much!

King Tiger,

Good question. Instrument selection can be trickey.

The initial reasoning behind the posting was to illustrate that more symbols are in a sustained (long) trend. I take the companies and create a correlation matrix to determine correlation values between themselves. One i've identified which symbols are highly correlative i dump them in a bucket. I then chart them together to determine their performance.

I study the movement of stocks that travel from 5 day highs to 20 day highs to 65 day highs to 100 then 52 weeks. I look at the trend and evaluate its timeframe.

I prefer the 20 day breakout for stock entries. Exits are more important than entries. I therefore find myself perhaps going long 4 to 6 stocks at once but i quickly cut my losses utilizing the turtles ATR. 1/2 an ATR on day of entry than an ATR alog. value, the following days.
I equally search for the same amount of units going short.
It's like doing landry. You're cycling through stocks and you're blowing out your losers.

When the trend continues i begin pyramiding, or adding on to the position

shakyamuni & babyturtle

Thaks for your useful comments.

I have a further question. I try to recycle stocks like babyturtle said but I have no extra cash left, meaning that to buy a new stock means to sell a current one. It's a question of opportunity cost.

Since I don't want to break the rule of double posting, could you please take a look at viewtopic.php?p=6383#6383 when you have a minute?


Ta!