New Addition to the New $5k Account

New Addition to New $5k Account

July 12, 2024

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This week, we’re trying to figure out what to do with my new $5k account.

It would be fun to use high-leveraged stock ETFs and watch what happens.

But the drawdowns would be huge and we know that trading (almost) always beats buy-and-hold.

So, in the last Newsletter, we looked at the Performance Page Portfolio–but we shrunk it down using the Micro E-Mini contract (MES). By doing that, we could fit 3 strategies easily into $5,000.

And if we compounded, we could grow it nicely and beat the market.

However, there was one thing I didn’t like. It had a few losing years.

Here are the Annual Returns via Portfolio Architect:

Again, the market has losing years, so this isn’t the worst thing.

But can I do better?

How about this?

What if we add the Buy on Monday YM strategy we talked about recently? First, we’d convert it to the Micro Dow contract, the MYM. And then we’d put it into our mix.

Now we have 4 strategies and the total margin required is almost exactly $5,000.

Here’s how that new portfolio would look:

Good report.

Here’s the Curve:

That also looks good. And here are the Annual Returns:

It’s not perfect but it’s better. And compounding would beat the market badly over the same stretch.

Takeaways?

One, I wish I had Gold in there. There is a micro for Gold but I can’t test it because it doesn’t have historical data.

Two, I’d love to possibly trade more contracts to see if I could squeeze even more out of it.

Three, it would probably look great with DCA (money added in).

Four, I don’t know if I’m all the way sold.

We may have to continue this discussion.

Talk to you soon.

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Disclaimer:
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples presented on these sites are for educational purposes only. These set-ups are not solicitations of any order to buy or sell. The authors, the publisher, and all affiliates assume no responsibility for your trading results. There is a high degree of risk in trading.

HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.