Grinding it out, day after day

Wow, amazing. I thought that was a 7 year old ad until I saw the date. I knew his dad was still doing workshops and that he used to help out at them. Sounds like the same bio he was using in 2003. Proves the saying those who can, do, those who can't, teach.

I haven't heard from him in a long time, maybe he's become a 'master trader'. He'll teach you 5 trading systems for only 4 thousand bucks, what a steal.
 
Can anyone relate to my befuddlement???


Quote from jones247:

This is all sooo "Counter Intuitive" to me. Why trade reversion to mean (rtm) with highly volatile stocks? Stocks with big swings in price throughout the day seems ideal for a breakout strategy trader, whereas the s&p 500 would be ideal for a rtm trader because folks often refer to it as having little volatility or a range bound instrument.

What am I missing here???

Is this not correctd...

High intraday price movement (volatility) = breakout strategy

Range bound intraday price movement = reversion to mean strategy

Walt
More...
 
What's so hard to understand? Stocks that bounce around like a ping pong ball or have rapid price spikes are good candidates for mean reversion.

Here's a trade from last Tuesday in RDN. Sell the spike, buy the retracement. Pretty simple stuff.

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=2749842>
 

Attachments

You're absolutely right, Lescor. The concept of buying when a volatile stock drops and selling when it jumps is very easy to understand. The BIG challenge is to discern if the stock is making a big move due to a material event (i.e. M&A, Accounting scandal, etc.) that has yet to hit the wires (web news). I guess that's why it's best to diversify among several stocks, to average down (scale-in), and to have an "uncle point" where the loss is too painful and you must exit your positions.

It seems to me that the s&p futures tend to bounce around like a ping pong ball more than most stocks. Typically will have a smaller range, which limits the likelihood of a major run in a given direction.

I would love to become proficient at trading equities. It seems that most of the profitable traders that I know of primarily trade the equity market. By nature I'm a contraian; however, I'm EXTREMELY affraid of entering RTM strategies on stocks that are about to "sky rocket" or "plummet" against me, as some news event that I was unaware of would cause the big move against me.

Nonetheless, thanks for your patience Lescor. Btw, in the spirit of Steve Cohen & SAC, would you be willing to receive a substantial % of my profits (50%) for 1 - 2 years by mentoring??

thanks,

Walt:(
 
Quote from lescor:

Wow, amazing. I thought that was a 7 year old ad until I saw the date. I knew his dad was still doing workshops and that he used to help out at them. Sounds like the same bio he was using in 2003. Proves the saying those who can, do, those who can't, teach.

I haven't heard from him in a long time, maybe he's become a 'master trader'. He'll teach you 5 trading systems for only 4 thousand bucks, what a steal.
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I thought Van Tharp was one of your gurus you followed, I think you mentioned his book in this thread.
 
Van Tharp and Rob Tharp are two different people. I am a fan of one of Van Tharp's books and recommend it to people. Doesn't mean I think he's a guru or that I follow him.
 
Quote from gkotopou:

10-24-08 12:42 PM

Quote from PJT:


Do you think trading successfully is a factor of emotional intelligence as much as it is technical intelligence?


You need control over your emotions to trade successfully, no one would dispute that. But to grow bigger and bigger, to keep scaling up as your profits grow, is the hardest thing to do and the limiting factor for most profitable traders.

You always hear of guys who make money but then when they try to trade bigger size, they screw things up and take a hit. They know how to trade, but have not let go of the emotional attachment to money. Everyone has a certain comfort level where the money truly doesn't matter. The key to growing is to slowly and methodically bring that level up while at the same time honestly and truthfully letting go of any emotional attachment to your p/l. It is hard to do and takes time.

After you've become consistently profitable though, it's the number one thing I think a trader should work on.


Lescor, read this from one of your old posts and find mastering your emotions very difficult, if not, hardest to overcome in trading. How did you 'let go' of your emotions over the years was it gradual process, did you find solace in your statistical analysis? And, with the help of automation, did it seal the deal for you? Is there anything else in your mind you find one should focus on conceptually speaking besides risk management, system, etc?

Kudos on your success.. g
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lescor,

Much thanks for the above post. It's the only post I've ever printed off.... and made me more $ than I ever thought possible.

B
 
Q/A Cont.

1. What do you tell people when they ask what is it exactly that you do?

2. Have you tried introducing to your line of work any relatives, friends, or others? Why? Why not?

3. If you had to start all over how would you approach learning how to trade?

4. How has your life changed as a result of trading? What did it give you and what did it take away from you?

Let me know If this sounds too much like high school homework assignment, otherwise there sure will be part II sometime in the near future.
:D
 
1. What do you tell people when they ask what is it exactly that you do?

"I trade stocks", "I'm a financial trader", "I'm a daytrader". I used to not like the connotation of the term 'day trader' as most people associate it with being an irresponsible gambler, but now I just don't care what people think.

2. Have you tried introducing to your line of work any relatives, friends, or others? Why? Why not?

I trained my sister in law to trade. She was making $11/hr as a customer service rep but I knew she had the mindset to be a good trader and was wasting her talent. She's been at it full time 3 years now and has done really well.

3. If you had to start all over how would you approach learning how to trade?

The same way. Approach it as a business. You have to have a plan that clearly spells out how you will turn a profit. Have realistic expectations and a cash cushion then work your ass off.

4. How has your life changed as a result of trading? What did it give you and what did it take away from you?

My life hasn't really changed. I can afford nicer stuff I guess, but I was pretty content with what I had before. I guess the best thing is I have more freedom and time to do what I want.
 
great thread. lescor, when you said your profit on average is 3.5 cents per share, is the share calculated based on round trip or one way?
 
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