Great stories all. Thanks for sharing.
My story: I only found p123 within the past year. I’d been using the AAII Stock Investor database for a long time and just didn’t understand the capabilities of portfolio123 or I would’ve probably tried it sooner. I was trying to do quant stuff by exporting data to Excel and build ideas based off the academic studies and reading about other investors’ process, but there’s no substitute to having a good backtester. Like I say, I would’ve tried p123 soooner if I understood the capabilities better. Marc Gerstein’s articles w/ process examples on seeking alpha helped me better understand why I needed to give this a try.
- Right now, for me, p123 is primarily an interesting research tool. I’m still building out models and have only put a small amount of cash into systems while I’m working on things. I do like the analysis.
- The first models I built were these “trade every week” type models, and I tried that a bit and realized I’m not ready for that.
- Now I’m focusing more on longer holding times and building things that work well on 3-6 month timescales.
- I realize I have a considerable weakness in the “execution” side of things. For whatever reason I dislike the actual trading aspects -placing and managing trades. I don’t know why, but I can’t stand it. I feel like there’s much for me to learn related to actual trading and implementation skill because it’s not intuitive to me all. I know there are people who can trade deftly, but I’m just not one of them, so I’m trying to build systems that don’t require frequent trading, at least until I get better at it. As it stands, I can spend entire days watching watching orders and trying to get good prices but not have any idea if I’m doing any good. There is no zen
For now I’m defaulting to just placing limit orders prior to the open, but I have no good process for all the positions that don’t fill and have to be manually adjusted as the day (or days) move forward. - That said, I realize that higher turnover is where the really high returns are - at least for accounts of my small size - so I think I’ll eventually end up there, but I need to get much more fluid or capable on entering/exiting positions. I kindof wish I had a trading bot that was well tuned to shorter term market movements so I could just hand the execution parts off to with instructions: “Here’s what I want to buy, get me good prices on executions today or over the next few days”.
- I greatly appreciated the ability to show what doesn’t work using p123. There are many ideas that I had accumulated that just were not providing edge and I’ve safely discarded those, or at least I have to think about approaching from a different angle.
- edit: I guess cognitively I have issues trusting what I feel is an expensive market, so I’m constantly concerned about a correction. At the same time I tend to agree that bull markets don’t end because of high valuations, and if rates stay low markets can stay elevated. This concern about market valuations can lead to a behavioral weakness for me. I’m not sure how to deal with it other than suck it up and realize something bad could happen at any time.
Personally, I retired young from a corporate job (it’d be fair to say I burned out). In investing I’m a hobbyist, and have always liked investing since I bought my first stock from yard-mowing money, but this is a chance to see if I can do better with my investments. It’s hard to let go of the more fundamental approaches though. I still like reading conference calls and learning about specific companies. With the quant approaches it’s hard for me to let go and just blindly buy/sell a ticker (and even after I buy I sometimes start studying the companies to learn what they’re about) but the backtesting and analysis tools give me better confidence in the entire process. If I can in practice get the returns and risk profiles of some of the models I’ve worked on (and if I can behaviorally stick with it), I’ll be happy with the results. I’m still in my 40s, so time is probably on my side (fingers crossed), but it’s not infinite.