Do the opposite trade

Bastion_01 said:
Brilliant, this is exactly how Jim Simons makes money
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I had no idea who Jim Simons was, until you mentioned him right here, right now. He's not exactly a household typical Wall St name, or character or image that the media covers often.
The best people, concepts and things...are truly hidden, or not main stream. His fund averages 66% every year for 30 years. All on auto-pilot, a fixed formula.

The exact recipe is obviously very secret, but from what I can loosely gather and read...he looks for probabilities, statistics and anomalies, then uses options for leveraged returns. The fund makes a ton of tiny gain trades, 150,000 every day. Average hold time per trade is two days.
 
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virtusa said:
My conclusions:
  • this is the first "profession" were no knowledge is needed (according to you)
  • you have no clue what trading is
  • even the biggest idiot can make millions without even knowing what he is doing (according to you)
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Like I said It was just a thought experiment.
If you need knowledge to be a successful trader then random picks must result in a loss.
So taking the opposite side of the trade must result in a profit.
The conclusion came from the thought experiment itself , It is not my view of the traders as I do believe is it possible to make money trading if you know what you are doing.

I think the user who said that after many random trades we would eventually have a close to 50/50 ratio of winners and losers is right so taking the opposite side would result in the same loss.
 
john7722 said:
Like I said It was just a thought experiment.
If you need knowledge to be a successful trader then random picks must result in a loss.
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The trade involves an entry, and an exit.
Let's assume that you do need knowledge to trade.
Let's assume the entry is random, but the exit is based on knowledge.
Conclusion: It's possible to have random picks, that won't necessarily result in a losing system.
Many years ago, I recall reading about someone doing this 'publicly' and profitably, as a challenge.
john7722 said:
So taking the opposite side of the trade must result in a profit.
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Let's assume you enter a trade; the market zig zags and stops you out for a loss.
Let's also assume that you take the opposite trade in the same thought experiment scenario.
Again, the market zig zags and stops you out for a loss.
Conclusion: Taking the opposite of losing systems doesn't necessarily mean profitability. (In addition to the reasons I mentioned already.)
There are too many variables to make a hard and fast rule like 'taking the opposite trades of a losing system will be profitable.' It all depends.
 
john7722 said:
If you need knowledge to be a successful trader then random picks must result in a loss.
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No, because with random entries he can either lose or win. Depends on how lucky or unlucky he is. Being succesful is in this case irrelevant as the entries are random.
  • If he enters long at the low of the day he wil win.
  • If he enters short at the low of the day he wil lose.

john7722 said:
So taking the opposite side of the trade must result in a profit.
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No, because of the reasons explained above.



Like @userque said:"There are too many variables to make a hard and fast rule like 'taking the opposite trades of a losing system will be profitable.' It all depends."

I said more or less the same already ina previous post:"If you would reverse that system you probable will lose much more then by moving the stops. You will have to analyze each separate signal to see the specifics of it. Not each loss is based on the same problem."
 
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Bastion_01 said:
I see you like to jump to conclusions without having referenced any information. That's always a sign of a great trader!
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Well, the "genius strategy" that according to you is used by Jim Simons, has already be debunked by others in this thread.
Say hello from me to Jim the next time you have a chat with him. :D
 
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