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Foreword | |
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Acknowledgements | |
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Preface | |
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The Most Important Factor in your Success: You! | |
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The Legend of the Holy Grail | |
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The Holy Grail Metaphor | |
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What's Really Important to Trading | |
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Modeling Market Geniuses | |
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Summary | |
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Judgmental Biases: Why Mastering the Market Is So Difficult for Most People | |
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Biases That Affect Trading System Development | |
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Biases That Affect How You Test Trading Systems | |
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Biases That Affect How You Trade Your System | |
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Summary | |
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Setting Your Objectives | |
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Designing Objectives Is a Major Part of Your System Work | |
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Tom Basso on Objectives | |
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Setting Your Own Objectives | |
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Conceptualization of your System | |
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Steps to Developing a System | |
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Take an Inventory | |
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Develop an Open Mind and Gather Market Information | |
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Determine Your Objectives | |
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Determine Your Time Frame for Trading | |
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Determine the Best Historical Moves in That Time Frame and Notice What Those Moves Have in Common | |
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What's the Concept behind Those Moves and How Can You Objectively Measure Your Concept? | |
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Add Your Stops and Transaction Costs | |
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Add Your Profit-Exits and Determine Your Expectancy | |
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Look for Huge Reward Trades | |
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Optimize with Position Sizing | |
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Determine How You Can Improve Your System | |
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Worst-Case Scenario--Mental Planning | |
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Selecting a Concept That Works | |
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Trend Following | |
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Fundamental Analysis | |
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Seasonal Tendencies | |
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Spreading | |
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Arbitrage | |
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Neural Networks | |
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There's an Order to the Universe | |
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Summary of Key Points | |
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Understanding Expectancy and Other Keys to Trading Success | |
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The Six Keys to Investment Success | |
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The Snow Fight Metaphor | |
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Looking at Expectancy under a Magnifying Glass | |
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Expectancy and R Multiples | |
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Expectancy Applied to the Market | |
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Using Expectancy to Evaluate Different Systems | |
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A Review of How to Use Expectancy | |
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Understanding the Key Parts of your System | |
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Using Setups | |
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The Four Phases of Entry | |
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Setups for Stalking the Market | |
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Filters versus Setups | |
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Setups Used by Well-Known Systems | |
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Summary of Setups | |
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Entry of Market Timing | |
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Trying to Beat Random Entry | |
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Common Entry Techniques | |
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Designing Your Own Entry Signal | |
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An Evaluation of Entry Used in Some Common Systems | |
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Summary | |
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Know When to Fold 'Em: How to Protect Your Capital | |
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What Your Stop Does | |
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Using a Stop That Makes Sense | |
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Preserving Capital | |
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Stops Used by Common Systems | |
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How to Take Profits | |
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Purpose behind Profit-Taking Exits | |
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Just Using Your Stop and a Profit Objective | |
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Simplicity and Multiple Exits | |
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What to Avoid | |
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Summary | |
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Exits Used by Common Systems | |
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The Opportunity and Cost Factors | |
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Several Approaches to Take | |
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Factoring in Opportunity | |
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The Cost of Trading Opportunity | |
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Summary | |
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What Do You Mean Position Sizing? I Only Have $10,000 in My Account! | |
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Position-Sizing Strategies | |
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One Unit per Fixed Amount of Money | |
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Equal Value Units for Stock Traders | |
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The Percent Risk Model | |
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The Percent Volatility Model | |
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The Models Summarized | |
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Examples of the Impact of Position Sizing | |
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Summary | |
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Position Sizing Used by Other Systems | |
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Conclusion! | |
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Appendices | |
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Recommended Readings | |
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Key Words Defined | |
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Index | |