How necessary are quantitative skills in order to trade profitably?
- Thread starter c.chugani
- Start date
To be a great trader you need some talent, granted, but to be a run of the mill PM at a fund or a market maker at a bank is a learned skill. Harvard graduate has an advantage there, as the school gives you good quantitative background and, most importantly, the skills needed to learn things independently. While it's very pleasant for the majority on this forum to cheer wildly when a Harvard graduate fails, overall Harvard-educated traders definitely outperform them. Same goes for the quantitative skills - while it's possible to be a good trader without any knowledge of math and stats (especially if you are a macro style guy), people with quantitative backgrounds certainly do better in trading then ex-marines and ex-plumbers.
they CERTAINLY do that's for CERTAIN, and that fact is derived from my quantitative background based on the kind of research I learned at Harvard after an exhaustive testing of trading skills of all ex-marines and ex-plumbers. Although to be fair, some of the ex-marines blew up up their accounts just because they were trained to blow things up. But you are CERTAINLY correct, I'm glad a poster with quantitative skills shows us how to come up with a CERTAINTY because there are so few in life.
Totally disagree. Some basic understanding of probability is a must for this business. You don't need to be a statistician, but you should have gotten As on probability, inference, and regression.
I use little quantitative input and have had a decent record over a decade.
However, quant skills would have improved my results, just as discretionary skills would improve a quant's results. The more skills, the better.
However, quant skills would have improved my results, just as discretionary skills would improve a quant's results. The more skills, the better.
Are you asking because you are mathematically challenged and want to know if you have a chance in this business or are you just curious?
I think a basic understanding of probabilities and statistics is a must for any trader, but you certainly don`t need need a degree in statistics or math for certain styles of trading. If are in a position where you can`t do your own statistical analysis, you can get it elsewhere, but you need a basic understanding in order to know what you are looking at and how to utilize it in your trading.
http://quantifiableedges.blogspot.com/
That said, I believe it`s possible to trade profitably without any statistical analysis, but if it can give you an extra edge to lean on it might be worth your time after all.
Regards,
LF
I think a basic understanding of probabilities and statistics is a must for any trader, but you certainly don`t need need a degree in statistics or math for certain styles of trading. If are in a position where you can`t do your own statistical analysis, you can get it elsewhere, but you need a basic understanding in order to know what you are looking at and how to utilize it in your trading.
http://quantifiableedges.blogspot.com/
That said, I believe it`s possible to trade profitably without any statistical analysis, but if it can give you an extra edge to lean on it might be worth your time after all.
Regards,
LF
Well, you definitely have to be able to keep track of your money, so posessing basic math skills is a given.
I don't think you have to be a rocket scientist, but you should learn the basic mathematics of the market. That means knowing how the bid system functions, and how stocks, bonds, and commoditities are priced and interact with each other.
For a really good primer on the market's math, nothing beats the mental gymnastics you can get into with some of the more complicated options strategies.
Ignorance can empty your pockets quickly in the stock market. Many times I have seen experts in one aspect of the market lose money when they didn't understand or follow events taking place on another side of the market.
PS. I went to school on Wall St. (literally - NYIF), so I'm kind of biased towards getting as much market education as you can, especially in the basics.
I don't think you have to be a rocket scientist, but you should learn the basic mathematics of the market. That means knowing how the bid system functions, and how stocks, bonds, and commoditities are priced and interact with each other.
For a really good primer on the market's math, nothing beats the mental gymnastics you can get into with some of the more complicated options strategies.
Ignorance can empty your pockets quickly in the stock market. Many times I have seen experts in one aspect of the market lose money when they didn't understand or follow events taking place on another side of the market.
PS. I went to school on Wall St. (literally - NYIF), so I'm kind of biased towards getting as much market education as you can, especially in the basics.