Consistent, benchmark-beating growth, combined with reduced risk, are the Holy Grail of traders everywhere. Laurens Bensdorp has been achieving both for more than a decade. By combining multiple quantitative trading systems that perform well in different types of markets—bull, bear, or sideways—his overall systematized and automated system delivers superlative results regardless of overall market behavior.
In his second book, Automated Stock Trading Systems: A Systematic Approach for Traders to Make Money in Bull, Bear and Sideways Markets, Laurens details a non-correlated, multi-system approach you can understand and build to suit yourself. Using historical price action to develop statistical edges, his combined, automated systems have been shown to deliver simulated consistent high double-digit returns with very low draw downs for the last 24 years, no matter what the market indices have done. By following his approach, traders can achieve reliable, superlative returns without excessive risk.
I recently caught up with Laurens to learn why he decided to write the book, his favorite idea that he shares with readers, and how that idea has impacted his life.
What happened that made you decide to write the book? What was the exact moment when you realized these ideas needed to get out there?
I wrote my first book, The 30-Minute Stock Trader, and it was a great success during the launch. Even today, it continues to be a great success. With that book, it transformed for many traders their beliefs and their ability to be able to trade in up markets but also in down markets. The last part of that book, I explained the magic of combining multiple systems and therefore being able to trade in bull, bear, and sideways markets and make money in all three.
Since we’ve been in a bull market for so long, I saw a chance to release a new book that’s more advanced and goes a lot deeper into my core of my philosophy of combining multiple systems at the same time. I’d seen that people like this concept and want to learn about it. Especially right now with all this panic in the markets, a strategy like this will be so incredibly helpful.
What’s your favorite specific, actionable idea in the book?
Everybody can develop systems based on historical price action that make money. Readers can see for themselves that combining trading long and short at the same time in one account gives you a better risk adjusted return and really helps you a lot in bear markets like these. It’s not as complicated as you think. All the rules for building a system like this are covered in the book.
What’s a story of how you’ve applied this lesson in your own life? What has this lesson done for you?
I’ve applied the philosophy of trading long and short multiple non-correlated systems at the same time since 2007. That means that in violent markets with a lot of volatility, I trade in a very comfortable way. I’ve made money every single day over the last month. That is not to say that strategies like these will always make money every day. Absolutely not. But I think the main thing is that, regardless of what the market or S&P 500 does, it won’t affect my mental state because I have strategies in place for every kind of market movement.
That gives me such a peace of mind, that even in times like these where we can adjust our positions according to the volatility, where we can trace both long and short at the same fine, that even in panicking events like these where 99% of the people lose a lot of money, they throw in the towel—I’ve made money in a very comfortable way applying these systems.
For more advice on setting up the type of trading system Laurens suggests, you can find Automated Stock Trading Systems: A Systematic Approach for Traders to Make Money in Bull, Bear and Sideways Markets on Amazon.