Elite Trader School

[longandshort]

What is less informed?
I know a lot less than funds managers, and analysts. But I know something they don't know. The quality of the information is more important than the amount.
If what I know is very important, it might be the reason why I beat managers, and analysts. A lot of the knowledge that funds managers and analysts have and I miss, has no real impact on the performance. So I don't need to know all they know.

I will give you an example:
I assume that Pfizer has more knowledge about medicines and vaccines than Biontech. But it was Biontech that created the "Pfizer" vaccine against Corona. Biontech is a dwarf compared to Pfizer and needed Pfizer because they had no money to fund the research themselves. But Pfizer would never had a successful vaccine without Biontech. Because Biontech knew things that Pfizer did not know.

The people at Biontech are high up the information curve — higher or at similar levels as Pfizer folks.

Most traders on this forum have negative information because of all the BS that is peddled. They are overconfident in their very limited understanding of how markets function and how to spot or evaluate opportunities. They are not like Biontech at all.

 

[Arnie]

Then you missed the entire point of his book, which is that there is little to no predictive value in technical indicators.

If you are trading, the best price signal is momentum. In fact, I provided a link to a great paper which details methods that can improve your trend analysis (buy with the trend, buy dips in the trend, etc.). Which Trend Is Your Friend? by Ari Levine, Lasse Heje Pedersen :: SSRN

This is true. The one and only one "technical" indicator that has any predictive power is momentum. It's the basis for all trend following systems. See "What Works on Wall Street".

 

[longandshort]

I mentioned once before - I've been trading 20+ years. Tom DeMark has been trading, with some of the biggest trading firms that have ever existed, for over a half century. He'd (and Paul Tudor Jones, Steve Cohen, Leon Cooperman etc) would be disappointed to know someone thinks his indicators don't add real value. Not.

Clearly you haven't done your homework on this. Or just sour grapes you can't afford them on your Bloomberg.

Tom doesn’t really trade.

I mentioned once before - I've been trading 20+ years. Tom DeMark has been trading, with some of the biggest trading firms that have ever existed, for over a half century. He'd (and Paul Tudor Jones, Steve Cohen, Leon Cooperman etc) would be disappointed to know someone thinks his indicators don't add real value. Not.

Clearly you haven't done your homework on this. Or just sour grapes you can't afford them on your Bloomberg.

There may have been a time where DeMark was useful, especially given his more thoughtful approach to technical analysis, but this was before computing became cheap enough where anyone can easily run multi-variate analysis in real-time. Using static models and approaches no longer work because the market is constantly adjusting and incorporating information. Signals decay very quickly and firms like RenTech and other quants (which are the modern-day technical traders) are constantly running new tests to find new signals that decay even faster.

No investor with size would hire you to manage money if you are trading on charts using patterns. Would love to see you pitch for a seat at MLP or Point72, or even PTJ. You will not feel great when the traders you respect hire a 25-year-old out of investment banking over you (retail trader with 20+ yrs of exp.). What I'm trying to do with this thread is help you compete with that 25-year-old (who will end up being a PM eating your lunch otherwise). If you still want to use your charts and such, so be it, but at least know the basics.

 

[longandshort]

That's what I've been saying all along. Buy stocks that go up!! Don't hold losers in your portfolio. Why do I need to know anything else? KISS

Yes but you need to know when the regime changes or you will constantly be buying winners just to sell them as the regime changes. This is because momentum in SNs suffer from reversals which can be violent and trend changing. So you need some way to qualify the trend, evaluate volatility in the trend, and whether the underlying driver of the trend will persist.

Here's a backtest of a strategy buying stocks that are up 50%+ and holding them for a quarter.

Now, if you are purely systematic (quant), then all you need is a good filter and then use robust risk management. But if you are picking the stocks you are trading, then you need to make sure your process adds value or it is just contributing negative alpha to your returns.

 

[virtusa]

The people at Biontech are high up the information curve — higher or at similar levels as Pfizer folks. Most traders on this forum have negative information because of all the BS that is peddled. They are overconfident in their very limited understanding of how markets function and how to spot or evaluate opportunities. They are not like Biontech at all.

I don't read all the BS you can find anywhere. In fact I never read anything at all, except for Markets Wizards (for fun, not to learn anything, received the 2 books from my broker as a gift).
I am confident but not overconfident and I apparently spot very well the opportunities thru mathematical models combined with discertionary action.
So I don't need all the info you posted or linked to. For me useless stuff. And I am surely not the only one who can trade without all that stuff.

 

[longandshort]

I don't read all the BS you can find anywhere. In fact I never read anything at all, except for Markets Wizards (for fun, not to learn anything, received the 2 books from my broker as a gift).
I am confident but not overconfident and I apparently spot very well the opportunities thru mathematical models.
So I don't need all the info you posted or linked to. For me useless stuff. And I am surely not the only one who can trade without all that stuff.

Sure if you are pure quant or HFT then you can skip the econ part and start at lesson 3 - market microstructure.

 

[virtusa]

Sure if you are pure quant or HFT then you can skip the econ part and move straight to market microstructure.

All the news is always in the quotes. And these quotes are the only relevant things as that is the price at which you get in or out. They decide about profit and loss.
PS: I am far from a quant or HFT.

 

[longandshort]

All the news is always in the quotes. And these quotes are the only relevant things as that is the price at which you get in or out. They decide about profit and loss.
PS: I am far from a quant or HFT.

Where did you learn this from?

Reposting again for relevance:

 

[deaddog]

Yes but you need to know when the regime changes or you will constantly be buying winners just to sell them as the regime changes. This is because momentum in SNs suffer from reversals which can be violent and trend changing. So you need some way to qualify the trend, evaluate volatility in the trend, and whether the underlying driver of the trend will persist.



Now, if you are purely systematic (quant), then all you need is a good filter and then use robust risk management. But if you are picking the stocks you are trading, then you need to make sure your process adds value or it is just contributing negative alpha to your returns.

There you've lost me with semantics again. I don't know what a regime change is. I watch price and when it starts to trend down, I exit the trade.

I have a system. I pick stocks that are rising in price on volume (how is that for filter). My robust risk management is not to hold losers.(I don't see any downside to being in cash)

All the system requires is discipline.

.

 

[longandshort]

@Baron please add this to OP under "what's my goal/why me"


My goal with this thread is to help the average retail trader move up the information curve. This will not turn you into a high skilled trader, but it will give you a leg up on the average new hire at an investment bank or hedge fund.