Are the majority of great traders systemetic or discretionary?

T

tonysoprano

This is for all the people out there who know or have made the acquaintance of really great , bad ass traders. I'm not talking about the George Soros's and Jim Simon's of the world. I'm talking about the traders very few people have heard about that are low profile but have amazing returns year in and year out.

Has it been your experience that the majority of them are a) systematic, i.e. they have a set of 100% objective trading rules they apply and never deviate from or b) discretionary in that they use their intuition to ferret out trades they take. I.e. not 100% objective.

In my experience it's been discretionary though I don't personally know many 100% systematic traders.
 
tonysoprano said:
I'm talking about the traders very few people have heard about that are low profile but have amazing returns year in and year out.
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This is very subjective, depending on what "amazes" you. I suspect that if you're looking for people who double their accounts regularly on an annual basis, for a decade or more, then you'll have to look very, very hard; but if something like 30-40% "amazes" you, then there are certainly some to be found.


tonysoprano said:
Has it been your experience that the majority of them are a) systematic, i.e. they have a set of 100% objective trading rules they apply and never deviate from or b) discretionary in that they use their intuition to ferret out trades they take. I.e. not 100% objective.
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The few I know well enough to be familiar enough with what they do to answer this are all ex-institutional traders. (I don't pretend that they're representative of "independent traders in general", but they may perhaps be representative of the "very successful ones" you're impliedly asking about.) Anyway they're all price-action traders who use few-to-no indicators, so I think most of us would probably consider them "discretionary" rather than "systematic". Again, even this is subjective and interpretative, because it depends on exactly what you classify as "systematic"; but my impression of what you mean, from the wording of your question, is that you'd probably consider most price-action trading to be primarily "discretionary".
 
Xela said:
The few I know well enough to be familiar enough with what they do to answer this are all ex-institutional traders. Anyway they're all price-action traders who use few-to-no indicators, so I think most of us would probably consider them "discretionary" rather than "systematic". Again, even this is subjective and interpretative, because it depends on exactly what you classify as "systematic"; but my impression of what you mean, from the wording of your question, is that you'd probably consider most price-action trading to be primarily "discretionary".
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Institutions traders are all price action trader? Where you get your information from? I hope you don't clasify those BS prop firm as " institution "?
 
Xela said:
This is very subjective, depending on what "amazes" you. I suspect that if you're looking for people who double their accounts regularly on an annual basis, for a decade or more, then you'll have to look very, very hard; but if something like 30-40% "amazes" you, then there are certainly some to be found.





The few I know well enough to be familiar enough with what they do to answer this are all ex-institutional traders. (I don't pretend that they're representative of "independent traders in general", but they may perhaps be representative of the "very successful ones" you're impliedly asking about.) Anyway they're all price-action traders who use few-to-no indicators, so I think most of us would probably consider them "discretionary" rather than "systematic". Again, even this is subjective and interpretative, because it depends on exactly what you classify as "systematic"; but my impression of what you mean, from the wording of your question, is that you'd probably consider most price-action trading to be primarily "discretionary".
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Yes, I would consider price action traders discretionary as they probably couldn't write down the exact 100% objective rules they follow ... and potentially automate it.
And yes the term "amazing" is also subjective and is whatever you find amazing. For me personally I had an acquaintance who, several times, traded $10K to greater than $150K in less than 6 months. And no he didn't lose it all between those times. He was discretionary futures trader. He told me that he analyzed the market and forecast how he thought it should behave in the near term and if it started to move as he thought it would he pyramided the crap out of it.
 
they have all been in the right place at the right time: standing in the pit getting all the orders from a filling broker, making markets in options in the 80s/90s, electronic trading ~2000
 
tonysoprano said:
Yes, I would consider price action traders discretionary as they probably couldn't write down the exact 100% objective rules they follow
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Then these traders you describe (couldn't write down their rules) are screwed (seen it happen way too many times)

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There are manual traders..., and automated traders

Under the auspice of manual.., there three subcategories

Mechanical
Subjective
Intuitive

Mechanical = 100% is defined
Subjective = takes above.., in its entirety - and adds some subjectivity / discretion
Intuitive = takes both above to another notch


Too many want to "end around" the process of learning this gig and jump into discretionary

That don't work - it will never work - best result will only ever be -> boom.., then bust


RN
 
tonysoprano said:
Yes, I would consider price action traders discretionary as they probably couldn't write down the exact 100% objective rules they follow ... and potentially automate it.
And yes the term "amazing" is also subjective and is whatever you find amazing. For me personally I had an acquaintance who, several times, traded $10K to greater than $150K in less than 6 months. And no he didn't lose it all between those times. He was discretionary futures trader. He told me that he analyzed the market and forecast how he thought it should behave in the near term and if it started to move as he thought it would he pyramided the crap out of it.
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Sounds a bit like early years Bruce Kovner of market wizards and hedge fund fame.
Im not a trader and wouldnt know a single one if I passed him in a strip club. I assume these ex-institutiomal guys have been constantly steered away from whats not likely to work to what
can work, they know a wide range of how multiple assets and their markets work from a non retail perspective, were able to compete with like talented people within their orgaization and succeed, have a very good idea where and how they can succeed independntly without the shackles of their firm, and finally, know their prey and know who not to compete with.
All of the above is probably an edge.
 
tonysoprano said:
In my experience it's been discretionary though I don't personally know many 100% systematic traders.
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Definitely discretionary even though I am more of a systematic trader, but the best I have seen have been discretionary. One I know and benefited from his trading tools a bit is truly phenomenal. Very sharp guy too, a physics Ph.D., probably at least 150 IQ points. You gotta be sharp to be a good discretionary trader. It's not really about having a Ph.D. (may not hurt, though), but being sharp.
 
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