Understanding Trading Rules

From Boris Schlossberg:

Now lest you think that these principles matter only to us lowly system traders and don’t apply to stock pickers, allow me to tell you about an exchange I had with the great Eddy Elfenbein this year. Eddy runs a great newsletter called Crossing Wall Street and you probably have seen him many times on CNBC’s Trading Nation. He is truly a great stock picker and his newsletter has beaten the S&P many years running. One time Eddy tweeted out about LUV (Southwest Airlines)

Here's a long-term chart of Southwest. Note the log y-axis to see how amazing the stock has been. Up 26,600% since 1980. RIP Herb Kelleher. pic.twitter.com/eCPL8L6Iyz

— Eddy Elfenbein (@EddyElfenbein) January 4, 2019

I took look at that chart more closely and realized something and responded back to him,

And yet Eddie it lost 75% of value between 01-10 – that required real belief to hold on

— Boris Schlossberg (@Fxflow) January 4, 2019

To his credit, Eddy fully acknowledged that point.

So the point is — if you trade you always have to Pay the Pip Piper — even if you don’t trade FX.

Check out the whole thing.

Posted by Eddy Elfenbein on April 6th, 2019 at 12:45 pm

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