Trading BTG: Some Thoughts

Doc writes:

I’ve been watching BTG for an entry point, and yesterday after the market there was no flag. But this morning, there is a flag for 2 days ago $2.97. So this system isn’t all that as they say. There is a component where you use your head and take an educated guess on buying and selling, since there so far hasn’t been a foolproof system that approaches 99% IMHO…doc


First things first. I’ve been in and out of BTG a couple times in the past two years, as well as the other miners, as well as the ETFs that track the precious metals and their producers. I don’t remember the results, and they don’t matter.

What matters is your other comments. How Quill promotes his system is up to him. The results he obtains from using it is up to him. But I’ll back him up on this one claim. In its simpliest form, and if the rules are followed exactly, the system can offer a positive expectancy *provided" proper position-sizing is followed. That’s a factor Quill doesn’t talk about. But it matters.

Also what matters is the fact that trading is a horrible thing to do to oneself. Gone is any free time. Gone is any social life. It’s hours and hours and hours of prep, execution, followup and a never-ending learning-curve. If you want to hear this from someone else, then track down how Linda Rasche --one of the world’s top traders with a 40-plus year career-- describes her trading day.

Lastly, there are no fool-proof, 99% percent trading systems, nor is one needed. What is needed is a ‘positive expectancy’ which can be obtained with right/wrong ratios as low as 20%/80%, though around 35%/65% is the classic profile for trend-following systems. Track down Van Tharp’s work for a fuller explanation, or Perry Kaufman, Thomas Stridsman, Alex, Elder, etc.