First and foremost, anyone who is paying attention to the markets knows that the dollar is being taken out to the shed and crushed against everything.  It is with this backdrop that the Cable Glider system has achieved a new equity peak on a single trade this week…a trade that was quite nice, but may have ended too early, as the British pound seems to be continuing to run higher after the Bank of England meeting this morning.  I continue to use the same event filters that I’ve always used to keep me out of the market today and tomorrow, however, this action is a repeat of what happened in May and June of this year for the Cable Glider; namely, a down month followed by a new equity peak and a slight regret at not trading the action subsequent to the BOE meeting.At any rate, I can only hope that this entire month will treat me as well as June did. 

Now then, my new asset allocation strategy is : 75% Cable Glider, 25% Euro Ranger (rebalance monthly).  Euro Ranger trades at lower leverage and serves as a hedge to the Cable Glider that I hope will be superior to holding a simple cash reserve hedge.  The Euro Ranger (ER) is a mean reversion style system and shows low correlation to the Cable Glider (CG).  Moreover, the ER trades with profit targets, so it’s trading profile is quite different than the ER.  CG is analogous to an aggressive growth fund and ER is analogous to a bond fund.

The new allocation plan brings me one step closer to becoming a true pro…in my mind, this is someone who trades a diversified set of systems and markets, and doesn’t get emotionally married to any one system.

Here are the month to date results for the combined program…significant positive performance has already caused allocation drift. 

# winning trades (CG/ER) : 1/1

# closed losing trades (CG/ER) : 0/0

CG Return: 27.0%

Hedge Return: 1.6%

Current Allocation (CG/ER): 79% / 21%

Total Return: 21.1% 

I’m going to go enjoy the win and try not to focus on all the money that I might have left on the table…after all, such is the nature of a trend-following system;  we never sell at the top, because we make no effort to predict where the top will be!