In TOYO KEIZAI ONLINE column now published — Investment performance dramatically improves from small triggers.

Good morning, this is Matsushita.

At last month's meeting of the trading study group I lead,

there was advice from other members regarding a certain member's trading rule.

It was suggested to add a trailing stop to ensure you lock in profits.

It was a perfectly sound piece of advice, but

neither the practitioners nor I had thought of it

during the 2–3 years of implementing and testing this trading rule.

We continued to test and verify,

and it was an idea that had not occurred to us before.

After hearing that idea,

I simulated it in my mind and

thought, “This could work.”

I instructed the rule's practitioner to conduct additional testing immediately.

A month passed, the additional testing finished,

and the results came in.

The results showed a dramatic recovery from drawdown.

When this rule is profitable,

it dramatically increases capital, but

once it enters a drawdown, the duration and

magnitude become the biggest challenges.

One casual idea from a single member

was exactly the idea that dramatically improves

this biggest challenge.

To reiterate, including myself, only a few members who understand

trading and the rules had conducted years of testing and consideration,

yet this realization was improved dramatically in an instant.

We believed our trading and buying/selling rules were already in the best possible state,

However, your trading and rules can be dramatically improved and enhanced right now with only a small trigger.

This incident has made me painfully aware of that.

Even after 17 years since I started investing,

I must not forget my初心, and I must consider what is the best choice,

and how I can further improve performance,

thinking flexibly and broadly at all times.

Please use this as a reference and

expand the possibilities of your buying and selling.