PTA Publications Commentary

 

When everything seems to be going wrong...

Trading futures and options involve substantial risk of loss and are not suitable for everyone.

No matter which point of the trading experience we're in, we'll either be at a point where the PTA commodity trading newsletter has reached new equity highs, is in a draw-down phase from new equity highs, has reached the low point of an equity draw-down, is coming from an equity low and working it's way back, or has broken out to new equity highs (and still climbing).  There is no other circumstance we will ever find ourself in when in the markets (be it with stocks, bonds, commodities/futures, or even mutual funds).  This is the cycle of the business we're in.

If you have signed-up for the service, and have found yourself in a drawdown period, I would like to sincerely apologize.  If you haven't signed-up for the service, but plan to, I'd like to apologize in advance.  I regret you'll be having this experience with PTA Publications at some point in your experience.  It will require patience with risk-tolerance, and this varies with each person. 

You and I are going to find ourselves in an ugly drawdown period where nothing we do seems to be going right.  In such periods I never know how long in time duration, or how deep in our pockets, this drawdown period will be. 

I do know this...when in realization we're in a drawdown period, the trading slows down substantially to the point when only select trades are taken.  The newsletter gravitates to lower-risk trades until a clearer picture with each individual market unfolds.  The newsletter seems to make a couple of equity spikes each year (if they're going to happen) - once in the beginning part of the year, and the other in the latter part of the year.  In between can be choppy, especially if the markets seem to be in a transition phase (from an up-trend to down-trend, or vis-versa), but if at least a couple of our markets are trending we should be able to keep our heads above water.  This is really a main point in year around trading...staying in the game long enough to see the next equity spike.  PTA tends to focus on the "base-hits," and every now and then we hit the home run.

The silver-lining with each draw-down period ever experienced is that it has been usually followed by new equity highs depending on the individual trader's risk-tolerance level.  By this I mean, if the trader has pulled the plug and/or thrown in the towel at the worst time, then experiencing new equity highs will not be a reality - rather, just another bad experience.  But on each side of every "valley," there is a "peak" (waiting to be climbed).  On the other side of a (equity) peak is, unfortunately, a valley to be experienced.

PTA generally recommends trades for ALL MARKETS & 7-Market portfolios (see Individual Sample Portfolios), and there are variations of each.  Please see the equity graphs for each of these two portfolios and find that current equity draw-downs generally do not go back to the levels of previous draw-downs.  They generally stair-step in an upward direction.  It would be preferable for equity peaks to be followed by areas of "flat" results, but this is an unrealistic expectation - welcomed, but seldom seen.

Again, I apologize now (and in advance) for the inevitable draw-down period that will be experienced.  If you will allow time to recognize the situation we are in, realize the trading has slowed down, be patient with the trades, we should come out of this draw-down period together to see better results.  This has been my experience!  I do really hope it will be yours too...

ALL THE BEST.

Editor & Publisher    PTA Publications, Inc.

Trading futures and options involve substantial risk of loss and are not suitable for everyone.

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