Yes to both questions, in my limited experience with breakout approaches.
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ACD--Is it the Method to The Madness?
- Thread starter amex2
- Start date
For those that know Mark F. , he doesn't need any extra pocket change--book and seminar revenue go directly to Make A Wish Foundation. ACD is just as useful for upstairs trading as it is for floor trading, the latter of which is obviously becoming more irrelevant by the day.
I think the ACD method isn't a fail-safe trading 'system'---but the underlying philosophy and disciplines are valuable tools.. As far as Fisher using ACD as a hook to get traders to clear through his firm, for a reasonably-educated trader, having a 'free subscription' to daily ACD is hardly an enticement...the decision to clear is based on execution costs and trading execution tools.
I think the ACD method isn't a fail-safe trading 'system'---but the underlying philosophy and disciplines are valuable tools.. As far as Fisher using ACD as a hook to get traders to clear through his firm, for a reasonably-educated trader, having a 'free subscription' to daily ACD is hardly an enticement...the decision to clear is based on execution costs and trading execution tools.
Quote from Thunderdog:
Perhaps I am unduly biased, but breakout methods strike me as a rather expensive way to trade, particularly when it comes to the indexes.
With more risk comes more reward. Yes you need an account size of atleast $25,000 to safely trade a small break out system on the YM. Thats why I don't recomend it to the newbies any more. Gap trading can be risky too but it backtests.
Personally, I think breakout approaches are riskier than certain other approaches, all else being equal. In my limited experience, I have found that breakouts require a lot more risk for a given amount of reward. I don't find that appealing. (In the guts and glory equation, I prefer a lower guts coefficient.)Quote from Spectra:
With more risk comes more reward.
If you consider the fact that the market oscillates much more then it trends, then yes. Finding a good system that capitalizes from the oscillations would be very fruitful. Thats what Alex's/PureTick's trigger really is.
Geoff
Geoff
Quote from Thunderdog:
Personally, I think breakout approaches are riskier than certain other approaches, all else being equal. In my limited experience, I have found that breakouts require a lot more risk for a given amount of reward. I don't find that appealing. (In the guts and glory equation, I prefer a lower guts coefficient.)
Quote from Cutten:
Floor traders make money by exploiting the bid-offer spread, being able to front-run institutional order flow, and reacting quicker than off-floor traders. That's it, pretty much, for almost all of them. The majority of floor traders become net losers once they go off the floor.
ACD is basically worthless IMO for any off-floor trader. It's also a cypher for floor traders. Just be on the bid in strong markets, and on the offer in weak ones. Fade sentiment extremes once stops get triggered. Know when a market order is almost done, then fade the order. That's pretty much it.
I have met with Mark Fisher and have been to his trading floor at the NYMEX. He has taught the ACD method to hundreds of traders including Eric Bolling. Fisher is running a prop operation upstairs that exclusively trades ACD. I have no reason to question one of the world's most successful oil traders.
Quote from Cutten:
Agree 100%.
If someone had a money machine trading method, they would trade it for billions at a hedge fund, not sell it to retail traders at seminars, or spend their time running a clearing firm.
ACD is a marketing tool, pure and simple.
Now I do think that Fischer has some good overall trading advice e.g. know where you are wrong. However, it is misleading for anyone to pretend that simply using the ACD method is going to give them any kind of edge. It's akin to Paul Tudor Jones recommending Elliot Wave.
There is no such thing as a successful trading strategy PERIOD. Only good and bad traders. However, ACD is one of the more simple and disciplined approaches to trading that I have ever come across whether you are a momentum trader or a fader.
I have said before, you can't take the info in the book and use it straight up. You need to bring your skills and experience to the table. For what it's worth, I have customized the ACD method specifically for indices and stocks and have done well with it. I have taught it to a handful of traders.
Quote from amex2:
For those that know Mark F. , he doesn't need any extra pocket change--book and seminar revenue go directly to Make A Wish Foundation. ACD is just as useful for upstairs trading as it is for floor trading, the latter of which is obviously becoming more irrelevant by the day.
I think the ACD method isn't a fail-safe trading 'system'---but the underlying philosophy and disciplines are valuable tools.. As far as Fisher using ACD as a hook to get traders to clear through his firm, for a reasonably-educated trader, having a 'free subscription' to daily ACD is hardly an enticement...the decision to clear is based on execution costs and trading execution tools.
Excellent commentary. No, I don't think a guy worth about 250 million is doing it for the money. And you are correct, all the money he raises from the seminars, 100% of it goes to charity. Yeah, a real charlatan this Fisher guy. LOL.
Quote from Thunderdog:
Personally, I think breakout approaches are riskier than certain other approaches, all else being equal. In my limited experience, I have found that breakouts require a lot more risk for a given amount of reward. I don't find that appealing. (In the guts and glory equation, I prefer a lower guts coefficient.)
As Taleb would say, faders live in mediocristan, momentum traders live in extremistan. Much more upside in extremistan.
Whether it's ACD or some other method, controlled disciplined risk plus market sense and bet variation is how discretionary traders make money. ACD creates the framework, but you need the latter 2 skills to make money. Just buying or fading breakouts mechanically doesn't cut it.
I think Fisher's book is fantastic. To see how a pro focuses so intensely on a fairly basic method and tweaks it to make it profitable is what trading is all about.
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I think Fisher's book is fantastic. To see how a pro focuses so intensely on a fairly basic method and tweaks it to make it profitable is what trading is all about.
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