TIL that the opposite of the gambler's fallacy is still a fallacy:
http://en.wikipedia.org/wiki/Inverse_gambler's_fallacy
2012: The Battle for Survival
- Thread starter neke
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TIL that the opposite of the gambler's fallacy is still a fallacy:
http://en.wikipedia.org/wiki/Inverse_gambler's_fallacy
Another fallacy is this:
if the price changes were random, then the price would not deviate much from each other, ie. practically it would stay at the same level, ie. stay flat.
But since this usually is not the case, and even Random Walk Theory proves it, then the conclusion is: the market is not random!
But then it must be predictable!...
So, what is true?
Neke, does your wife have any idea about your trading ups and downs? I mean, when you tell her you had "a rough day" in the markets, does she know that 300k has disappeared from an account? Im just curious. Not trying to stick my nose too far in your business, but man take a real hard look at how the stress and anxiety you are harboring may be affecting your family. I think your regular cash withdraws have been your best trades.
The fact that the losses tend to be large multiples of the wins suggests, at the very least, that Neke is almost never getting the best of it.
Trading is simply another form of gaming or gambling, i.e. it is making bets on the outcome of events. The only way to make consistent profits over time is to bet when you have the best of it and refrain from betting when you have the worst of it (which assumes you are playing a game that is beatable, i.e. a game in which you can indeed get the best of it, at least from time to time).
Trading is simply another form of gaming or gambling, i.e. it is making bets on the outcome of events. The only way to make consistent profits over time is to bet when you have the best of it and refrain from betting when you have the worst of it (which assumes you are playing a game that is beatable, i.e. a game in which you can indeed get the best of it, at least from time to time).
I would say that a trader with an edge and who bets within his or her bankroll should have very few losing months, and none so catastophic as to result in a losing year, let alone three losing years in a row.
A losing month should at least signal to a trader that some reevaluation of his play is required. Multiple losing months should signal outright failure and the need to get back to the proverbial drawing board.
This assumes that the desired end of one's trading is consistent profitability. If one is trading for fun, or one is trading for a score by attempting to run up a small money bankroll, (both of which are, in my opinion, good enough reasons to trade) then these considerations are less relevant.
I assume that Neke's goal is consistent profitability, and not entertainment or to make a score.
Code:
ENTRYAMT EXITAMT NETRETURN
35160 36156 974
16800 17790 961
31150 32513 1341
20194 22230 2015
41040 41425 370
31138 32305 1145
133954 130623 -3369
52167 54495 2313
46303 48427 2102
48900 48300 -622
59952 59566 -416
49572 50056 462
67040 67220 165
55000 60035 5006
57600 58800 1185
34536 30566 -3999
51840 48600 -32556% loss from two trades is not unexpected for the strategy in question, although should be rare. I have tabulated the returns from the srategy from 7/30/2012 when I started measuring it, the results are above. The last two trades are this week's losing trades. In spite of those the strategy is still positive over that period, and it simply means I will be more constrained with my sizing from now until I am sure it is not a permanent market change.
It appears from your weekly comments that you are always making changes to your strategy.
If that is the case, how can you make a fair comparison from one week to another and all past results?
The only constant seems to be you as the trader.
If that is the case, how can you make a fair comparison from one week to another and all past results?
The only constant seems to be you as the trader.
$500/day on an account my size will seem like a home run in the long run
Yes, I am working on getting to that consistency, and certainty in my strategies - I am longing for the day when everything I do will be mechanical (answer a number of objective questions and let the algorithm place a trade if conditions are met)
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