Here is an exchange of comments I had this morning with one of this blog’s readers:
Carl
You were very scathing about the wine man and other bears like myself. We were predicting 1070.
My goodness, we were out as well but at least we got the main trend right.
How did you miss this?
I am not being critical just asking why your analysis missed the biggest move of the last 20 years.
Catherine
Here is my reply:
My dear Catherine:
You accuse me of being "scathing". Please point me to the post or comment in which I used unkind words to describe you or your market views, or anyone else's for that matter.
Perhaps you take disagreement between us about prospective market direction a bit too personally?
In any case, I recall that you made a blog comment when the e-minis were trading around 1130 on October 1 or so. You asked me not to publish it and I didn't. In this comment you cited your 1070 target and said that you thought the market was probably making its low, at least temporarily at that level.
So I ask you - how could you have missed the 22% drop below your target during the past 10 days? You have been about 22/47=47% as "wrong" as I have been!
Of course, the fact is that I believe the market is about profit and loss, not about right or wrong.
Respectfully yours,
Carl
Again I think it is important to remember what we are here for. An investor’s results can only be measured by the standards of profit and loss, perhaps after adjusting for risk. An investor gets paid by his net profits, not by being"right". See this post for my earlier thoughts on this subject.
14 comments:
nice trade Carl.
thanks for letting me look over your shoulder.
Solrac
Carl has been wrong and he has been resolute in his comments, but not scathing. Of course I am a man and women take comments differently IMO.
I'm getting awfully tired of right vs wrong, and such discussions have absolutely no future value.
Carl,
Who do you think that will remain long over the weekend under the current circumstances?
People with deep pockets and confidence in the longer term health of the U.S. economy.
Catherine
You're gifted and smarter than many of us.....where can I find your blog?
Carl does a tremendous job and I have no complaints on his work or trade recomendations.
Trading is like admiring art; we each walk away with our own interpetations of the work.
I believe the market is about profit and loss, not about right or wrong.
Well said Carl.
Perhaps the word dismissive rather than scathing would have been more apt. The more people that suggested the market was going much lower, the more you persisted with your bullish view. You used their bearishness as evidence that the market was going to go up ie aginst the crowd.
You are missing my point - I am not talking about right and wrong, I am trying to learn about your analysis.
Roubini predicted this most accurately and I posted things from him before here. Soros, Jim Rogers and many others suggested these events - so I am asking - what did you see technically or fundamentally to have such a different view?
For the record, I sold all my UK property in 2006-2007. I sold my NZ property in early 2008. I used the proceeds in 2007 to buy jpy and sell gbp starting at 238 and selling down to 224. i bought short date JGB's with the proceeds.
i was short continually down to 1070 and yes, you are right, I missed a big proportion of this move which I am not happy about.
One person asked why I dont have a blog? Well I do actually send out weekly emails to a great group of friends suggesting ideas to safeguard their money and futures during this period. Perhaps they would like to be added to the list.
Regards Catherine
Carl
I have a new measure of respect for you to put up with Catherine. It appears her work is the work of others whom she cherry picks or blends into her opinion (who's opinion/work?). Weekly emails to friends.....please!
I mentioned in the past; I've been to many Robin Hood dinners; met many great world class traders, worked beside one of the them for 12 years. Each of these traders have character and are secure enough in their trading skills; as such do not to seek approval of others by being labeled; right or wrong; that moral philsophy is like trying to spend a thank you!
To Anonymous 3:54,
I can't speak for Carl, but I have never gotten the sense that Carl is "putting up with Catherine". In his post about profit/loss versus right/wrong, he was very complimentary to Catherine and said that he always enjoyed her posts.
In fact, if profit is the name of the game, all of us should hold her in highest regard. She has done everything right over the past few years and has recently made a profit of like 38 times her investment capital if I am remembering one of her posts correctly. Who cares whether her work is "original" or a compilation and distillation of the work of others when you make that kind of profit? By Carl's own measure--profit, Catherine is way out in front of all of us.
Have a great weekend all!
Greg
Carl,
I agree that trading is not about being wrong or right. Its only about profits vs. losses as you say. Having said that, the take away from Catherine's post whether she states it outloud or not is that greater profits were made the past 12 months trading with a short bias than a long bias. Nobody can dispute this and you should at least recognize this.
Kind Regards,
MK
MK:
Yes, but so what? I refuse to engage in a battle of egos - I'm smarter than you etc.
Anyone can see that it is better to have been short on average over the past year. But this says absolutely nothing about the average performance of one's market approach. It takes a sell AND a buy to complete a trade.
So far all I hear is that it was/would have been smart to sell near last year's top. But none of these people have yet to complete this trade by turning bullish. Nor do they say just when they turned bearish before the top - I know some who have been bearish for 10 years!
Yes, agreed. Battle of ego's accomplishes nothing and in fact could be detrimental to one's trading and one sided trades are meaningless! From an academic perspective, can you see why your analysis methods did not foresee the SP500 reaching 850 on this move down? Was there a violation of some past support that warranted greater attention in the "weight of the evidence"?
MK
Catherine,
Could you kindly add me into your email group?
alvinxw@yahoo.com
Carl, I have been reading your blog for many years. I learn a lot from you!
Thank both of you so much!
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