Larry Connors and his Machine are the seeds of all QiT’s strategies. We’ve made some changes but, if you know about Larry Connors way of trading, you’ll see the similarities.
Qi’T’s Trading Philosophy
Here is the basis of both QiT’s and Connor’s trading philosophy:
- All entries use a limit order below the close for buys and above the close for shorts
- All exits are based on the Connors RSI or a close below the 200 simple MA
- Exits are dynamic except some portfolios add a stop called nBar
- Positions are sorted on the 100-day historical volatility so we are trading only the most volatile
- All entries require a pullback %age
- We very rarely are fully invested, we most always have cash in our account
Now here is where we diverge. This is the point where we take algorithm development one step further.
- We do not use a trade through. Connors never addressed this issue
- We use a Money Flow filter, Connors used volume
- QiT utilizes both exit at open and exit with a limit order
- Use a Circuit Breaker for when the strategy gets out of sync with the market
As well, monthly optimizations are conducted resulting in parameters changing to ensure the algorithms adjust to the market environment.
Taking it one step further:
- We accommodate for the Tick Size Pilot Program
- We list all the evaluators of each portfolio in a Performance Matrix
We’re the Plan in “Plan your Trade and Trade your Plan” – TraderJanie
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