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Thanks Yuval - have you ever backtested stop losses on your portfolio?

Yuval Taylor

Yes, and I used them myself for a while. I think they're a terrible idea. It's impossible for the price you paid for a stock to be relevant to its prospects.

Mark S

In comparing quant strategies to O'Neil, you open up an enormour can of peas that will let people comment forever with no adequate conclusions. THe relevant comparison to a quant strategy is MarketSmith not 1600 pages of IBD. Why I think your conclusions are wrong is that fundamentally based quant strategies typically outperform the markets, when they do, by 2-3% a year at best. If they're generating 47% a year, I'm not seeing them. The big difference between quant and O'Neil is the extraordinary emphasis O'Neil puts on technical trading. A quant strategy might thrown in a handul of technical factors but O'Neil makes it 50% of the game with a highly developed sequence of contigent relationships. The marvel for me is that no one has automated a quant strategy that captures this technical side, maybe they have, but my experience with quant stragies at Haugen, StarMine, BARRA and DAIS suggests they depend on large groups of portfolio holdings to refine their factor exposures. O'Neil - and bettter yet Minervini - are capable of winnowing that down to a few specific names, surely the holy grail of investing.

Mark S

What were your top holdings each month in 2023?

Yuval Taylor

Small retail investors can, if they work hard enough with fundamentals, make significant gains with microcap-based algorithmic trading. I'm not the only person I know who has beat the market by more than 10% annually by using fundamentals-based algorithms to buy and sell microcaps. Large institutional investors can't make those kinds of gains.

Here are my top five holdings each month this year:

beginning of January: LYTS, HMDPF, IBEX, TOTZF, ISTR.

beginning of February: IBEX, HMDPF, LYTS, NECB, BWMN.

beginning of March: HMDPF, IBEX, LYTS, MPX, CLMB.

beginning of April: HMDPF, MPX, CMT, PMTS, INTT.

beginning of May: MPX, KMDA, HMDPF, CMT, JFIN.

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