hmm.no edges in the markets

[ElCubano]

Quote from nitro:

90% of all retail traders lose, they just lose!

Just kidding. I have been on the prop side and on the retail side. Every prop firm I have ever been in rakes in serious cash. Every retail trader I know with a very very few exceptions struggle. If you saw what it takes to succeed, you would quit right now. This game takes money to make money. Then you need brains. Then you need to work your ass off. Then you need technical know-how. Then you need relationships. Then you need to get around silly rules, then you need to do decent volume to get good comissions,. then...It is possible to do this at home in your pajamas if you already have money, but the farther you are from being able to make markets or engage in [statistical] arbitrage, the more risk you have to take with larger sums of money. Read that last sentence 30 times. Read it again. Here is it: but the farther you are from being able to make markets or engage in [statistical] arbitrage, the more risk you have to take with larger sums of money. There is a way around it. Get a job so that you can have systems that only trade with patience, slowly putting away money to fuel a positive edge system. Otherwise, if you are not MMing or Arbitraging, the more pressure you are under to generate streams of income, the faster your money goes out the door.

One day, I am going to write a book and get it off my chest. it will be the only book in the history of books on markets of its kind. I will write it under a pseudonum. Wait, if I use my real name, no one will know it's me

I'd buy the book.

 

[dbphoenix]

Quote from trilogic:

seems complex...

Actually it's very simple, though it's not easy. If it were both simple and easy, everybody would be doing it, and everybody would be making money. But though everyone tries, nearly everybody fails. In fact, nearly everybody races toward failure with a single-minded determination.

Do you want to succeed or fail?

 

[trilogic]

Quote from dbphoenix:

Actually it's very simple, though it's not easy. If it were both simple and easy, everybody would be doing it, and everybody would be making money. But though everyone tries, nearly everybody fails. In fact, nearly everybody races toward failure with a single-minded determination.

Do you want to succeed or fail?

I want t o be "good" judge smails ?

 

[Sergio77]

Quote from dbphoenix:

You'll read that the % of winners can be less than the % of losers as long as the winners are sufficiently profitable, one's management is superior, etc. And, yes, theoretically, one can "win" less than 50% of the time if his profits sufficiently outweigh his losses. But if your real-time real-money test begins with a string of the losses anticipated by your backtest, you'll be out of the game almost before it begins. In fact, one can be left high and dry even if his % of wins outnumber his % of losses, as mentioned above, if there is insufficient control of the amount of loss OR if the losses occur in sufficiently high numbers at the beginning of the trial.Then there are commissions and assorted trading costs to take into account, which is why traders who actually trade find that, without size, all the postulations about percentage don't mean much in practice.

Most trading wizards put a lot of emphasis on high probability setups but then came some smart paper traders and said that it does not matter if you are winning 30% of the time if you make more than you lose on the average to have positive expectancy. But the expectancy equation does not take into account that returns are non-ergodic and you can get a lot of losers in a raw before the win rate stabilizes and be kicked out of the game early as a result. I think edges exist. For example the methodology followed by this blog points to some edge with the goal of spotting high probability setups in various etfs and stocks that are validated in other markets. Although I find the approach elaborate it appears that it has sound foundation.

 

[dbphoenix]

Quote from Sergio77:

Most trading wizards put a lot of emphasis on high probability setups but then came some smart paper traders and said that it does not matter if you are winning 30% of the time if you make more than you lose on the average to have positive expectancy. But the expectancy equation does not take into account that returns are non-ergodic and you can get a lot of losers in a row before the win rate stabilizes and be kicked out of the game early as a result. I think edges exist. For example the methodology followed by this blog points to some edge with the goal of spotting high probability setups in various etfs and stocks that are validated in other markets. Although I find the approach elaborate it appears that it has sound foundation.

Key word being "appears". If sufficient details are provided, it can be tested and verified. If not, it's most likely just another sales pitch to sucker the losing trader.

As for the "smart paper trader" remark, you are probably correct. Competent traders aren't going to be satisfied with a 30% win rate. For one thing, those who really trade will understand the psychological damage that can be and usually is done by repeated losses, resulting in taking profits early if and when they come because the trader is too afraid to hold.

As far as "edges exist", of course they do. But few traders define "edge" correctly, as if it were a special talent or skill or attribute of some sort bestowed by the trading fairy. The edge begins with the knowledge one gains through research and testing that a particular market behavior offers a level of predictability and a risk to reward ratio that provides a consistently profitable outcome over time. One doesn't just buy it from somebody somewhere.

 

[Redneck]

Quote from trilogic:

I choose 2 minute then.

one chart one frame- thnx


I hate complicated, so ... should be easy right right...

ok ....

The antithesis of complicated is simple – which trading is

Whether or not it is easy depends solely on you…. and how well you’re able to play follow the leader – without the mistrusting / questioning / personal BS

============================

Think in terms of control and pressure – who has it / who’s applying it / and to what extent

buying / selling wise that is


RN

 

[wrbtrader]

People that say trading is easy or simple....they're veteran traders.

In addition, today's markets are too complex, uncertain, ambiguous, frequently changing intermarket relationships and globally connected.

Therefore, when a trader says he/she is using a simple method or keeping it simple, that is a trader accomplishing such because he/she has a deep and complex understanding of today's markets...something a newbie trader can only obtain after many years of trading experience.

This is the reason why simple methods can be easily learned but extremely difficult to apply in real trading conditions until one obtains enough trading experience.

 

[dbphoenix]

Quote from wrbtrader:

People that say trading is easy or simple....they're veteran traders.

In addition, today's markets are too complex, uncertain, ambiguous, frequently changing intermarket relationships and globally connected.

Therefore, when a trader says he/she is using a simple method or keeping it simple, that is a trader accomplishing such because he/she has a deep and complex understanding of today's markets...something a newbie trader can only obtain after many years of trading experience.

This is the reason why simple methods can be easily learned but extremely difficult to apply in real trading conditions.

Uncertain, yes, and few people can trade in an environment of uncertainty. But "many years"? No. If one can tell up from down, it takes a fraction of that.

It begins, of course, with a study of price movement, then a trading plan. Almost no one wants to do either. But that's the wannabees' choice, not a fact of life.

 

[trilogic]

Quote from wrbtrader:

People that say trading is easy or simple....they're veteran traders.

In addition, today's markets are too complex, uncertain, ambiguous, frequently changing intermarket relationships and globally connected.

Therefore, when a trader says he/she is using a simple method or keeping it simple, that is a trader accomplishing such because he/she has a deep and complex understanding of today's markets...something a newbie trader can only obtain after many years of trading experience.

This is the reason why simple methods can be easily learned but extremely difficult to apply in real trading conditions until one obtains enough trading experience.

so far today TF 2 minute I discern that the "opening" was a bit volatile and then drifting higher, nothing much.....

you don't use volume do you ? thanks

 

[burt_schroder]

Quote from chimera:

all i see is gambling.

People that claim they have an edge...maybe 1;100 do for a very short time frame. One market....millions of traders..aint going to happen.

Seeing as though speculative trading comes under the general heading of gambling, you shouldn't be too surprised.

As for the edge that is required, you can either make money speculating, or you can't.

Not much to post about really, except for theory and opinion. But I guess that's all about, 'talking a good game'.