Quote from DisciplinedHedg:
I would disagree with you wholeheartedly on this one. There is no rule that performance regresses to the mean.
Simply investing in a manager because he is down, whether or not you believe in him, is akin to betting on heads simply because its landed tails the last couple times.
Quote from OPTIONAL777:
You have no understanding of the laws of probability, the performance records of traders over the long run, do you? This kid Schindler is not a proven commodity, what's not to understand?
Senseless argument about coins.
Anytime you want to bet on the coin not going tails, after 25 heads in a row, call me.
Quote from DisciplinedHedg:
Understand? I neither believe or disbelieve that he is a "proven commodity" as you say, nor have I indicated anything of either. Besides, what's it take to be a proven commodity? It's all debatable.
I was giving a general statement, using coins as an example. Are you saying that after 25 heads in a row, you would give yourself better odds that it would land tails? I'll take that bet any day.
Quote from OPTIONAL777:
If you understand streak probabilities, yes I will make that bet with you.
Take Barry Bonds, a proven commodity. Say he is in a slump. What are the odds with each pitch, given his long term record, of hitting a home run each successive strike out?
Point is, that most traders, professional traders, professional money managers, proven commodities, will have good and bad streaks. They have learned how to manage their own streakiness.
I would prefer to have my money managed by a proven winner in a bad spell, than bet on him if he has been on a hot streak.
Remember Kobe's hot streak? What followed? Average performance, if a bit sub-par for him.
Why is it that human beings (apart from Tiger Woods) typically run hot and cold?
A lot has to do with their psychology, and just the natural order of things.
Schindler has no system that I can see, he was foolish enough to admit that he looks at threads in ET for ideas on how to trade. That is a system? Sheesh. If I had my money with the guy, I would pull it immediately upon hearing that.
My contention is that 99% of trading is mental, and 1% the mechanical system. It takes a real machine of a trader to go through a losing streak and not flinch on the next trade, and I don't think baby Schindler has the balls for it. My god, the dude had to go to the bathroom several times during the on-line chat because he was so nervous.
His puny little fund is not proven so he really is not a good example, but I would put my money with Peter Lynch, Buffett, Niederhoffer or others after a losing streak beyond their historic averages.
Quote from DisciplinedHedg:
"Streak probabilities." Thats a new one.
That Barry Bonds example. I would say that his chance of hitting a home run neither improves or worsens just because of his last hit. If there even is a change, I would even say it worsens. Wouldn't that be consistent with your "streak probability?" Why would you bet against the current "streak" as you say. You seem to be contradictory.
I find it curious that I never mention Aaron, and yet you continue to bring him up and bash him.
Quote from DisciplinedHedg:
"Streak probabilities." that's a new one.
That Barry Bonds example. I would say that his chance of hitting a home run neither improves or worsens just because of his last hit. If there even is a change, I would even say it worsens. Wouldn't that be consistent with your "streak probability?" Why would you bet against the current "streak" as you say. You seem to be contradictory.
I find it curious that I never mention Aaron, and yet you continue to bring him up and bash him.
Quote from Aaron:
The peak to valley max drawdown if looking intramonth or intraday will be larger. It cannot, mathematically, be smaller.
Quote from triple_j:
1. trading (for the most part) is a fools game. sooner or later you will blow your fund or lose such a substantial amount of money you will close the fund. anyone who is still trading successfully hasn't had it happen to them. yet......
triple