Been looking at different strategy managers lately and getting tired of just seeing flashy return numbers.
What do you actually check first when you’re digging into someone new? Drawdown seems obvious but wondering what catches your attention right away.
Win rate means nothing without knowing your average win size.
Risk-adjusted returns are what actually matter. Getting 20% returns with crazy volatility? Not that impressive.
Sharpe ratio cuts through the BS - shows you if someone’s skilled or just got lucky.
First thing I look for? How they perform across different markets. Sure, a manager might have killer returns, but if they only crushed it during bull runs, that’s trouble.
I need to see how they handled both trending and sideways markets - minimum one full year. Monthly breakdowns beat flashy headline numbers every time.
Drawdown duration is everything. It’s not just about the loss - it’s how long they stayed down. A 15% drop that recovers in two months? Way different from someone stuck 10% underwater for eight months. Long recoveries usually mean the strategy’s broken or the manager chokes under pressure. I look for consistent bounce-backs, not just their worst loss.
Trading frequency shows their real strategy. Some managers overtrade just to justify fees or because they can’t sit still.
I look for managers who only move when it actually makes sense, not to show they’re busy. Excessive trading usually means they’re gambling or lack conviction in their picks.
Position sizing wrecks more accounts than wrong picks. That’s the first thing I check.
I’ve watched managers torch their accounts risking 5-8% per trade trying to pump their returns. The good ones cap it at 2% max, no matter how sure they feel.
Inconsistent sizing or huge bets on single trades? I’m done. Don’t care if their win rate looks amazing.