Hi guys, I want to share my recent backtesting result on Road trip trade. underlying is RUT, margin is from 6000 to 10000. I'm a very conservative guy, I did backtesting just for gaining some confidence, and I really like the smooth equity curve. I think the only way to minimize the draw-down is to cut the loss early.
Hi G... Thanks for sharing your results. I don't see your user name among our Road Trip Subscribers, but it was good to see your results with RUT. The equity curve you show is typical for the performance of the RTT...slow and steady increases. The performance of the RTT is also excellent using SPX or ES options, as Tom and I do. I suffered a draw down in the Feb March cycles due to illness (concussion and after-effects) which seriously affected my risk management of my positions. However, as you suggested, the best approach when price passes through the short strike of the core position is to begin to exit the trade. This approach also makes sense on an expectancy basis. Had I been able to effectively manage my risk during the Feb-March cycles, my losses would have been minimal. Tom and I have additional management strategies which are taught to RTT Subscribers. We will soon be moving the RTT to Aeromir.com, but current subscribers will be transitioned easily. For any new traders viewing this thread, Tom and I would like to invite you to the RTT Service. A trial membership is available.