Are trader's skills really important?

<< Sorry if I offended you Tom, but a few years in this biz has really attuned my BS detectors! >>

You didn't offend me and there's no need for apologies. I've always believed in my ability to find an edge and I can't understand why a bright chap like yourself has effectively thrown in the towel. Funster, pull yourself together, lad :D Why the cynicism? Why are you so certain that, despite your (not so) unsuccessful efforts, Dottom and others have not been able to come up with something which has temporarily eluded you this time only?
 
Originally posted by dottom
A lot of people are saying 2002 is going to be oh so much more difficult thatn 2001, or the markets have changed, and many other similar statements, but I still see the same intraday trends as I've always seen and my results have been consistent
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i can confirm that. the only thing our system has "noticed" in 2002 is the pickup in volatility, so there has been considerably more action in january as compared to nov-dec. other parameters have not changed.

- jaan
 
Funster:
"Ultimately by it's very nature most people will lose"

Yes. But it doesn't mean that I will lose. I want to find an edge and use it to take money from other traders. There's no guarantee I will succeed.
Running a website, doing seminars - I agree - it's good to have another source of income. Trading profits are uncertain. oolarinm is right "trading is easy if you have another income source". I would say "is easier" - but only psychologically.

"You have the same probability of making it big as a hollywood actor"

I disagree. I know, it's getting harder and harder to make money in any business these days. Competition is increasing. The impact of luck factor is also increasing in most businesses IMO.

tom_p:
Thanks for interesting post. Here are my answers:
1) I want to trade. But only if I will have an edge. If an edge will be relatively small ( profit factor 1.2 - 1.4 ), I will also look for different sources of income in order to have more stable, less risky personal incomes.

2) intergalactic testing, wow!!! :) ( btw i like the beastie boys song "intergalactic, intergalactic... intergalactic!" and funny video, too! )
If I'll have statistically positive system I will trade with it. It depends on it's variance whether I:
- will trade this system with someone's else money ( somebody who can accept the risk of loss )
- or with my own money ( how much money I will put in trading ).
It depends on my personal financial situation. I don't want to tell everybody on this board what's my current acct size, how much I'm willing to risk. It's something personal. At this forum I only want to share ideas with you.

4) "Where there's a will, there's an advantage"
Of course, that's why I want to trade. I don't think that it's possible to win in casino even if a wheel and ball aren't 100% perfect. Even if I want to win at roulette, there's no real advantage there...

5) I put my energy and effort to research the theory of trading systems. I want to test different trading strategies on historical data and on real data. I'm trying to get Tradestation2000i for backtesting ( maybe my former university will buy it ). I hope I find some edge! :D

DT-waw
 
tom_p

"You didn't offend me and there's no need for apologies. I've always believed in my ability to find an edge and I can't understand why a bright chap like yourself has effectively thrown in the towel. Funster, pull yourself together, lad Why the cynicism? Why are you so certain that, despite your (not so) unsuccessful efforts, Dottom and others have not been able to come up with something which has temporarily eluded you this time only?"

Thank you for your kind words. However I also pride myself in finding the edge. I have done so in the past in real business, otherwise I could not afford to be here, having a go!

What I think most people in this line of work fail to realise is that they are the customer. Of the mountains of brokers, seminar providers, authors and researchers. Most business is unsuccessful unless you have to actually go out and get it. Trading and the internet means that most people are being sold to - the reverse of that. It has many similarities to multi level marketing.



DT-waw

"Yes. But it doesn't mean that I will lose. I want to find an edge and use it to take money from other traders. There's no guarantee I will succeed. "

You realise that what you are effectively asking (on probably the most well known public trading post room) is how do I take money off you guys? Come and play me at poker sometime and I will "teach" you. Might cost you a bit though!

"5) I put my energy and effort to research the theory of trading systems. I want to test different trading strategies on historical data and on real data. I'm trying to get Tradestation2000i for backtesting ( maybe my former university will buy it ). I hope I find some edge! "

And welcome to the wonderful world of curve fitting! The highs of creating a system that will make you a million in a year... to the lows of realising it doesn't pass the walk forward test, or worse degrades during trading your own money. They don't call it the "standard in backtesting" for nothing. It means everyone has got it! It will not give you an edge. It is just a gateway for others to sell you add on products, data etc.

Let me save you the heart ache and the wasted time. The longer a system works in the past the less likely it will work in future because the more likely it is to have been discovered by the masses and be priced into today's market. That is why donchian channels, moving averages etc don't work as well anymore.

If you truly believe that you have the computing power to really have an edge then take a look at www.top500.org. This is lists of where the top 500 supercomputers in the world are placed. Many of them are at financial institutions and have probably taken some of your money already!

Perhaps a bunch of us should club together and buy one?!
 
"You realise that what you are effectively asking (on probably the most well known public trading post room) is how do I take money off you guys? Come and play me at poker sometime and I will "teach" you."

Maybe I will stop posting here on ET...

Funster : your advice is: don't use TS, don't create trading systems - it won't give you an edge, and even if system looks good on historical data - it won't work in the future, because people will discover it. You can't win with financial institutions who use supercomputers.

Maybe it's true. :confused: I don't know since I didn't tested systems on historical and real time data. Maybe systems don't work on es, nq eminis, but they work on eurodollar, bonds, yen or euro FX.

Let's assume that in 2002 there won't be any satisfactory trading systems on any markets.
It doesn't mean that there will be no satisfactory systems in 2003.

Trading can be sometimes harder, sometimes easier. For example yesterday ( 22 Jan 2002 ) on NQ and ES futures... it was an easy day, many systems/traders made big profits. This game is changing, people are changing, everything changes, it's a alive organism. This is very important difference between trading and casino games. The nature of casino games is always the same. Trading is similar to life. The impact of luck factor is also huge in life....

I believe that there are some methods to trade/live by. People want to live, people want to trade. We must believe that with right methods and luck we have a chance to succeed. I'll never lose my hope.

DT-waw
 
Funster:
And welcome to the wonderful world of curve fitting! The highs of creating a system that will make you a million in a year... to the lows of realising it doesn't pass the walk forward test, or worse degrades during trading your own money. They don't call it the "standard in backtesting" for nothing. It means everyone has got it! It will not give you an edge. It is just a gateway for others to sell you add on products, data etc.

100% truth. So, logically, in order to become profitable trader one should focus energies elsewhere.
 
"Funster : your advice is: don't use TS, don't create trading systems - it won't give you an edge, and even if system looks good on historical data - it won't work in the future, because people will discover it. You can't win with financial institutions who use supercomputers. "

Perhaps if you look past what tradestation can do you might have a fighting chance of getting an edge for a while. However if you have used any commercially available package to do so then probably best to forget it.

Trading is warfare. Elite Trader, I guess, is therefore the equivalent of the english and german troops during the first world war who stopped fighting one christmas to play a friendly game of soccer!
 
Originally posted by Funster
Perhaps if you look past what tradestation can do you might have a fighting chance of getting an edge for a while. However if you have used any commercially available package to do so then probably best to forget it.
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Funster, this doesn't make any sense. Tradestation, and other charting/analysis software such as Wealth-Lab, can only do what the trader programs it to do.

It is as much or as little as the logic programmed in by the trader.

If your statement was in regards to commercial "black boxes" then I agree with you. It goes back to the "if your 100% mechanical method works why sell it?" question.
 
Tradestation (and it's kin) is a tool that is a standard weapon in this war. It is unlikely on it's own to give you an edge is all I am saying. There are plenty of things it won't allow you to do, but to be fair you can bolt on programs / make programs yourself to do most of them. On it's own most people will therefore IMO gravitate to the kind of systems that have been done to death already.
 
Tradestation (and it's kin) is a tool that is a standard weapon in this war. It is unlikely on it's own to give you an edge is all I am saying.

I disagree with you to a tune of six figures a year for six consecutive years. Many other people will disagree with you on this one.

There are plenty of things it won't allow you to do, but to be fair you can bolt on programs / make programs yourself to do most of them.

I don't know if you've seen the plug-in capability of Tradestation or Wealth-Lab? With a plug-in you can program *anything* and you are only limited to what data is available for input. Perhaps you haven't looked at some of Mark Jurik's work, as an example? Jurik produces some tools for TS and WL that I could never ever do with anything else.
 
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