For futures and forex, how could it be otherwise? Commodities and currency do not produce value like companies, they are assigned value. And your gain in commodities or currencies absolutely means at least one somebody else's loss(es). Likewise your loss in commodities or currencies means at least one somebody else's gain(s). The total amount of money remains constant absent deposits and withdrawals.
Can Short Term Trading Be More Profitable Than Long Term
- Thread starter Fundlord
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There is also the matter of timeframe and goals, though it all has to do with perception. Those who buy on the way down, for example, are not all stupid, ignorant amateurs. They may be professionals who've been in this for dog years and have entirely different perceptions of value. It is their buying after all which slows, halts, and reverses the decline (though there are of course many stupid, ignorant amateurs who are throwing their money away and may as well just set it all on fire).
Not necessarily. What if, for example, somebody bought whatever long before you did and profited handsomely? You then pick up the ball and run with it until you decide for whatever reason to take your profits. You both win. As might the person buying it from you in the event of a continuation.
One could argue that the individual who sold to you "missed out" on the extra profit, but then one could also argue that you lost by not buying earlier.
Perceptions is everything and 100% of us forecast by taking an entry. I was on phone other day with an acquaintance and each of us was trading, doesn't happen often, ES just broke support by four ticks. I said "I had enough of this", my buddy started laughing his rump off, in background I heard his computer chime "order filled", he jokingly said I should learn from him cause he just took other side of my "loss" and he went short, I started to laugh my rump off and told him I was already short and took profits and went long, Silence on his end, now he is totally concentrating and tells me he has to go. He hasn't called me since. I don't know if he perceived me losing by the words I used or had a signal to go short there.
I changed my way of trading 4 years ago, I went from making profits first to getting risk as close to zero as I can, sleep much better when I do sleep, but now I never think about my positions. Airlines do hedges and did have options to cover or so call spreads. The hard parts of trading when one is starting out is never thought or realized often till too late, how not to lose, most only concern themself of getting in.
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Very funny. Thank you.I agree about being concerned about risk rather than reward. If one addresses the risk, the reward will take care of itself. Over the years, however, the manner in which I address risk has changed: whereas I used to be concerned primarily with price risk, I'm now more concerned with information risk. This enables me to avoid being so anal about "stops", particularly whether or not they are "tight". In fact my stops -- or, more accurately, exit triggers -- are much farther away now so that I can avoid thinking about them and focus on price instead as it is that which will prompt an exit, not some predetermined price level. If I don't like what I see, I'm out, and the hell with the "stop". On the other hand, if everything seems fine, I'm more inclined to give the trade a bit more rope. And it changes throughout the day depending on what time it is, what support or resistance level we're approaching, the activity level, the pace, etc, which is why telling somebody to enter a trailing stop of blah blah is so meaningless, except of course as a means of dealing with fear. Or rather avoiding dealing with fear.
Oy. This is why the competitive nature of the markets is confusing. It is by no means direct competition. As I stated earlier, the person taking the opposite side of your entry is almost never the same person taking the opposite side of your exit. And all three of you may turn out to be winners, which means a fourth (fifth, etc.) person loses. Given the myriad possible interactions that are possible in the markets, it makes no sense to talk about direct competition (except in the extremely rare occurrences where the same person is taking the opposite sides of both your entry and your exit. And how would you know?).
The competition in markets is indirect, and the only scorecards are the collective p&l sheets. But as a rule, the more knowledgeable and experienced traders are winners over the less enabled.
While it is true that experienced traders take advantage of inexperienced traders, I don't see the market as competitive. Most do. Many see it as an actual battle. But I don't. And my perceptions will be very different from those who see it as such. (That my perceptions are different can be plainly seen from my posts to the Scribbles thread.)
my god how many ways can this discussion go. this thread is akin to watching online fitness clowns debate about which macronutrient split is most ideal.
Depends of the dictionary you use. There are dictionaries with more than 100 000 words. So before we agree on the definition of each word we need a little bit of time.
I like to discuss about trading, systems ..., but when we get stuck in definitions the discussion is over for me. Total waste of time. Especially if this becomes quibbling (hope this is the right word, because my knowledge of english is limited).
I agreed, slippage and commission is the one that kill retail slowly but definitely.
A lot of PA guru here claimed they have edge to overcome the commission & slippage, but I never see any real proof that they have those edge. Most only show the chart in Hindsight that they will buy here/sell there and etc thus they are profit using PA and position management, this is typical ET.