1/x Long tails in #exploration If you invested 100K AUD into each of 110 #ASX #discovery announcement containing "significant" or "major" discovery between 2010-2021 and held them for 1 year, you would have made 4.06 MAUD in profits. Sounds great right? #mintwit #mining
2/x In april 2014 your strategy is 500K below water. You get up in the morning to make a strong cup of coffe and smash another 100K on the table on the next "significant discovery". The investment you just made will go on to lose 98.8% of its value over the next 12 months.
4/x Investing in natural resources is not for the fainthearted. But you dont need to be complete deardevil to make success. @equivestinvest and I have built a database of price-data and fudamentals for +160K instruments over all asset classes and 29 countries.
@StrategiesQuant 30% per trade? Why 30% instead of using something like the Kelly criterion to optimize the trade?
@StrategiesQuant Especially for oil and gas plays which often have binary outcomes
@witchdoc86 I like the idea of using Kelly criterion to sieze positions. In the backtest i just assumed to allocate equal amount to every trade without compounding.