thequietwon

Appreciate your thoughts Kim! I think I use the 50% loss for losers mentally, not as being representative of typical SO losses, but rather what's in the realm of possibility. I might be erring on the side of caution (maybe even ridiculously so), but it helps me set my risk tolerance. I figure commissions plus my typical rookie mistakes could of course play a role as well. I also completely agree with the SC example... any trading system needs enough time to turn a profit and work as expected.

Steadyabc, As you mention, I'm not sure this is the proper thread for performance discussion, but here goes: It's discouraging - I want to offer some empathy because I've had a bad losing month too. But that doesn't mean Kim's system doesn't work. I've missed a few of the SPX butterflies, and have experienced BAD losses on the trades I have gotten into. January has been a bad month for me. I admit that I myself have not been satisfied yet with my own consistency using Kim's system, but that's due to two reasons: 1.) I haven't yet matched his performance - I've come to believe simply following his alerts, you will NEVER match his performance - you must learn to anticipate and make this system your own (and the folks in this community are more than happy to help you do that) 2.) Losing streaks are expected (which is what I'll discuss for now)Others have noted that the positions you listed aren't even closed yet - but for the sake of discussion, let's say they are. Let's assume you're matching Kim's performance, and talk about losing streaks: Even in the BEST systems, statistically, losing streaks are bound to happen. In fact, they can even be mathematically quantified by the following equation: LS=ln(TS)/-ln(1-PW/100) Where LS is the worst potential losing streak, TS is the trade sample, and PW is the probability of winning (ln is the natural log). Since inception, SO has experienced 831 trades, with a win ratio of 62.1%. This STATISTICALLY allows a worst-case losing streak of about 7. That means, that on ocassion, this strategy will experience 7 losers in a row. That's IF you match how well Kim does (and that's a big IF!). That's also assuming Gaussian distribution (which isn't the best assumption - meaning statistical anomalies are more likely than given in normality). But the system works. The VAMI speaks for itself. It just needs time and consistency. Drawdowns can be pyschologically devastating though. If you have the time, I cannot recommend this talk highly enough (about 21 minutes in is where he talks about losing streaks): Ask yourself - can you handle 7 losers in a row with a 10% allocation? To be conservative, let's assume each loser loses 50% - that's nearly a 35% draw-down on the account. If you require a lower risk tolerance, you should lower your allocation.