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Strategies & Market Trends : Joe Stocks Trader Talk

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To: Joe Stocks who started this subject	4/11/2002 7:39:38 AM
From: Joe Stocks	of 787

This from TD Trader this am. I thought the comment about risk/reward was interesting. "Last night was the Society of Technical Analysts (STA) meeting and Steve Griffiths of MTPredictor.com gave the presentation. He has been a private trader for 15 years and concentrates on finding ABC corrections (Elliott). As it happens, we may have such corrections in the Dow, S&P 500 and Nasdaq 100 (see analysis below). Based on his trading techniques, Griffiths used to run a newsletter that gained over 50% last year. He has since stopped the newsletter to concentrate on software development. In addition to the ABC correction setup, Griffiths emphasized the importance of a reward/risk ratio and ability to make money with a batting average below .500. His >50% gain was achieved with 38% winners, 62% losers and an average reward/risk ratio of 3.3 to 1. Once your reward/risk ratio gets above 2 to 1, it is possible to make money with a .500 batting average (yes, a coin flip!). The key lies in the ability to identify the right setup, control losses and let profits run. The goal is to make money, not bat over .500."

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