Find 1000 people each with $1000. Half enter long, half short. Lever the positions so 200 pips will double the money. After a day or two, 500 people will be twice as rich. Repeat the process ten times. By the end, one person will be a millionaire, think he's a trading genius, and win a crowd of devotees who hang hopefully on his every word. Quite a few of the losers will lament that they got *this* close to success, but disobeyed their rules, or lost discipline, or were attacked by a black swan. Many will be back studying their charts for a better entry. But those with any sense at all will get a real job and recover their money.
Consider the "diversification" claptrap. The aim of the millipede strategy is to hold on to winners for the long term, except, of course, when you don't. By some magic insight, we only hold on to those trades in line with the main trend (which we magically discern) and we sell off counter-trend trades at the (magic) point where the retracement stops.
That sounds easy. What could possibly go wrong?
Consider the "diversification" claptrap. The aim of the millipede strategy is to hold on to winners for the long term, except, of course, when you don't. By some magic insight, we only hold on to those trades in line with the main trend (which we magically discern) and we sell off counter-trend trades at the (magic) point where the retracement stops.
That sounds easy. What could possibly go wrong?