Andrew Abraham

andy-0101 My name in Andrew Abraham. I have been investing in commodities and managed futures since 1994. I adhere to the philosophy of trend following. Trend following stresses a disciplined approach to commodity/ futures trading. Successful trend following and commodity futures investing requires patience, discipline and actively managing the risk. What sets me apart from other traders is that I am not only concerned about the return on investment but how much risk I will have to tolerate to achieve my goals.

Contact Details

If you are interested in contacting for speaking engagements. Please email me at Andrabr9@gmail.com or call 954 903 0638.

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Risk Warning

Futures and commodity trading involve substantial risk. The evaluations of futures and commodities may fluctuate and as a result, clients may lose more than their original investment. In no event should the content of this website be construed as an express or an implied promise, guarantee or implication by, that you will profit, or that losses can or will be limited in any manner whatsoever. Past results are no indication of future performance. Information provided on this website is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible, where projections of future conditions are attempted.

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Commodity Trading & Trend Following Mechanical Systems

One of the biggest differences in commodity trading is that many successful commodity trading advisors use trend following mechanical systems. Of course there are other commodity trading advisors that use pattern recognition …counter trend as well as basic fundamental analysis to base their decisions. However in my opinion, when a commodity futures trader uses a mechanical trend following system they put themselves in a position to capture rare large moves. The success of commodity trading comes from capturing these rare large moves with proper risk management. This is the key to compound money over long periods of time.

Trend Following commodity trading advisors over the years have programmed their ideas into mechanical systems that detail trade potentials ( entry and exit) as well as position sizing. There is no real thinking. Trend Following commodity trading advisors are looking for price to move. They do not predict, rather react. The goal is to catch a new trend. Commodity trading advisors look to take pieces out of the trend. Only liars catch bottoms and tops. There is no holy grail in trend following unlike buy and hold ( pray). It all boils down to making yourself available for those rare large moves( not losing too much money when they are not occurring).

Virtually everything is pre thought out with an exact plan ( yes an exact plan with successful Commodity trading advisors). The markets trade are thought out. The amount of correlation between similar markets are planned. Risk per trade is planned. What constitutes an entry signal.. How to exit a trade with a profit as well as a loss. What is the total open trade equity that is acceptable. This is like a well trained army or football team. Everyone knows what to do. There is no gut thinking.. I will x number of contracts today because I think this or that.. With successful commodity trading advisors, what will make them buy is that there is a price move beyond a certain threshold that in their model possibly signifies a beginning of a potential trend. The successful commodity trader asks himself/herself.. how much is this going to cost me to see if this trade works. Commodity trend followers know that any trade is 50/50. There is nothing about being right. It is very simply…the trade is going to work or not..If there is a trend..it is working.. Pretty simple and clear. The huge difference between successful commodity futures traders and others is in their trend following mechanical system there is not just focus on entering …but rather ..how many contracts can I put on for my predetermined risk tolerance.. (R). Successful trend followers know it does not matter to be right..actually, most trades don’t work. Lets say the win/loss ratio can be 30% wins and 70% and the commodity trading advisor can be extremely successful Simple.. small losses..rare..large gains.. and position sizing ( when the trade works..if the commodity trading advisor has numerous contracts based on his/her risk model). Look at it this way..lets say the JY goes from 100 to 108 and you have 1 contract…you make x.. but for the same risk per trade you were able to put on 2 contracts for the same risk..you have made much more money. Forget about all the nonsense of snake oil advertisments like 80% winners. It is the surest way to be a loser.

There are key questions the trend following mechanical system needs to answer
1. Which markets to trade based on my equity
2. What signifies a buy or sell
3. How do exit with a profit or a loss
4. How many contracts do you put on..( risk per trade.. risk per sector..total open trade risk)

Of course there are other issues..More so don’t think for one minute this is easy.. Even when you have a trend following mechanical system or a commodity trading advisor you need the discipline and patience to follow the system/ commodity trading advisor for at least 4-5 years.. Otherwise really don’t start.. I have seen more people quit at the first sign of a draw down and run to another system or commodity trading advisor. More so.. keep it simple..but not simplier..

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Andrew Abraham
www.myinvestorsplace.com

Futures and commodity trading involve substantial risk.People can and do lose money trading.

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