Automating Your Strategy – Kevin Davey

Automating Your Strategy - Kevin Davey

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1. Calling in Trades to Automated Systems
2. Process for Creating an Automated Strategy
3. Trading Idea to Trading System
4. Discretionary Trader to Algorithmic


Kevin Davey
Founder, KJ Trading Systems

Kevin’s Resources

Rapid Fire ?

Q. What Trader has influenced your life the most and why?
A. I have been influenced by many traders. The market Wizards books, for example were a huge inspiration. Those books showed me that 1) successful trading was possible and 2) there are multiple ways to successfully trade. Those are important lessons, since at first the markets seem daunting.

Q. What was one of the hardest things for you to overcome in Trading?
A. For the way I trade (algorithmic trading) the toughest thing is always to follow the rules, without exception. There will be times an algo takes a trade, and I’ll think “that is a terrible trade.” The urge to overrule the algorithm is sometimes huge. But over time, I have found that it is much better to let the algo’s do their job!

Q. How has your trading process evolved over the years?
A. Over the years, I have gradually learned from my mistakes, and created a strategy development process that minimizes the chances for traps like overfitting, curve-fitting and over-optimization. So, the strategies I create today are quite a bit better than the strategies I created 10 years ago. I have always treated trading as something I needed to get better and better at – continuous improvement is key.

Q. What is one attribute that you believe every trader should have?
A. Perseverance. The ability to fight through the losing periods and drawdowns is important. Trading is hard, and it gets frustrating and depressing at times.

Q. Favorite Book about Trading?
A. The first Market Wizards book. A close second is Reminiscences of a Stock Operator.

Q. If you had to pick a profession other than trading, what would it be?
A. If I did not trade, I’d probably be a financial planner or wealth advisor.

Q. What’s the best advice you received about Trading?
A. Dr. Van Tharp always tells traders to only trades strategies that fit you as a person. I think that is terrific advice. Trading with a strategy or technique that does not feel comfortable to the trader is a recipe for disaster. Usually this becomes an issue at the first major drawdown.

Q. If you can give a piece of advice to the younger you, what would it be?
A. Don’t fall for the “trading is easy, get rich quick” schemes. Trading is much harder than it looks.

Q. If you had to elevator pitch me your edge trading, what would you say?
A. I create strategies that have a proven edge, determined from a methodical and rigorous testing process. I couple those positive expectancy strategies with highly disciplined and diversified trading.

Q. Favorite thing to do when not Trading?
A. Spend time with my wife and children!

Record Date:  2/05/20

If you enjoyed this interview with Kevin be sure to listen to these other episodes:

Synthesis Equals Edge – Mark Yusko

The Macro Impact – Danielle DiMartino Booth

Futures Radio is a weekly talk show hosted by 20-year futures veteran and CME member Anthony Crudele, an ex-pit trader and one of the first to trade the E-Mini S&P. Each week Anthony talks with traders, CEOs, and other proven market participants about relevant trading and investing information.


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