"Quote by Monroe Trout - (New Market Wizard - Jack Schwager)" by alifari in Dukascopy Forex Community
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Quote by Monroe Trout - (New Market Wizard - Jack Schwager)

Monroe Trout – Over the five-year period surveyed, his average return was 67 percent but, astoundingly, his largest drawdown during that entire period was just over 8 percent. As another demonstration of his consistency, he had been profitable in 87 percent of all months. At age 40, he retired from active trading with a net worth reportedly in excess of USD 900 million. New Market Wizard.

I don't use that much leverage.

A successful trader is rational, analytical, able to control emotions, practical, and profit oriented.

I rent my condo and I drive a cheap car.

At the end of every single day, my staff gives me a summary sheet listing the slippage in each market.

We try to diversify everything we possibly can. We like to diversify over both trading strategies and
time.

There was no question about what to do because one of my risk management rules is that if we lose more than 1.5 percent of our total equity on a given trade we get out.

If we're down 4 percent on a single day, we close out all positions and wait until the next day to get into
anything again. If you don't have that type of rule, you can end up being long the S&P on a day like October 19, 1987, when procrastinating in getting out would have been a disaster.

We have a maximum loss point of 10 percent per month. If we ever lost that amount, we'd exit all our positions and wait until the start of the next month to begin trading again. Thankfully, that has never
happened.

I sincerely believe that the person who has the best daily Sharpe ratio at the end of the year is the best
trader.

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