Two Months with 2.0

After two months, the CMI 2.0 has performed better than expected. An annualized gain of greater than 62% is the benchmark. Since we have gained 19% after two months, this would put us far above that mark. Expectations need to be tempered somewhat since historical data shows the CMI 2.0 to have one gain for every loss, or put another way, a 50% win/loss record. Since December, the CMI has put together three winning trades in a row. The record of consecutive winning trades is six. This would be a good year, since it is the first year of the CMI 2.0, to
set the bar higher.

The Neural Networks guys state that, "The Stock Market prediction task divides researchers and academics into two groups... those who believe that we can devise mechanisms to predict the market and those who believe that the market is efficient and whenever new information comes up the market absorbs it by correcting itself, thus there is no space for prediction."

(That's one reason that specific details regarding the CMI or any other system that the monkey throws the dart at is kept under wraps.)

"Furthermore they believe that the Stock Market follows a Random Walk, which implies that the best prediction you can have about tomorrow's value is today's value."

Although I consider myself an APEademic, efficient market hypothesis, has some merit but methods such as the CMI have proven that systems can be devised to exploit a consistent advantage using following indicators. Predicting the market requires a whole new set of tools.

As emphasized by Jack Schwager in The New Market Wizards, "If you don't want to watch the quote screen all day (or can't), don't try a day-trading method. If you can't stand the emotional strain of making trading decisions, then try to develop a mechanical trading system for trading the markets. The approach you use must be right for you; it must feel comfortable."

After two months, I am uncomfortably comfortable.