How NOT to trade-

alot of ppl don't know how to trade. :confused: -- regardless if you have a high school education, or PhD. or if you're male, female...young, old, etc etc etc.
 
lawrence-lugar said:
alot of ppl don't know how to trade. :confused: -- regardless if you have a high school education, or PhD. or if you're male, female...young, old, etc etc etc.
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I'm sure that's true, just as it's also doubtless true that people with some kind of formal education in statistics, probability and math have advantages and collectively better outcomes when it comes to trading: there might be reasons why so many financial institutions prefer to appoint math/science graduates with top degrees from top universities to their entry-level trading career positions, after all.
 
Xela said:
I'm sure that's true, just as it's also doubtless true that people with some kind of formal education in statistics, probability and math have advantages and collectively better outcomes when it comes to trading: there might be reasons why so many financial institutions prefer to appoint math/science graduates with top degrees from top universities to their entry-level trading career positions, after all.
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Exactly.

Renaissance Technologies has never hired a Wall Street type: MBA, Finance, Economics, etc.

Renaissance has hired: science, math, computer, even a code breaker and a speech therapist who had high pattern recognition skills.

For manual trading, some firms like SIG give big bonus points to master games players:

Poker, chess, backgammon, bridge, newer video-game competitors, etc.
 
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Clubber Lang said:
This guy Scalptrader on Briefing.com is the King of adding to losers and relentlessly adjusting his "stops". Then when the trade becomes a complete trainwreck he changes his position from a "Scalp" to a "Swing". Watch and learn how NOT TO TRADE...
(Read from the bottom to top)-

LIVE IN PLAY
04-Dec-15 15:59 ET
SCALP
ScalpTrader: UVXY Update -- Going to carry position overnight; moving stops down to $24.00 area to accommodate early movement on Monday. (24.80)

04-Dec-15 14:54 ET
SCALP
ScalpTrader: UVXY/Market -- Really some perplexing price action to me. I'm going to take a hit here as well if this get stopped out (25.01 -5.19)
Just want to let you know that I'm sharing in the pain on this. I don't mind taking a loss on this b/c I make most of my money on high conviction set ups that I scale into. I have to take the winners with the losers. UVXY is a tricky instrument, but I'm just as perplexed by this monster bid under the market even as segments of the Energy complex continue to come unglued.
04-Dec-15 14:39 ET
SCALP
ScalpTrader: UVXY Update -- Adding a final 1/3 here per plan. I'm trading a historical price pattern here, but it is starting to move beyond what I've seen in the past. Still planning to take as a swing. Putting stop in place in the $24.40 area. (25.45 -4.74)
At some point I'll have to step away, but still think there is a good chance this could lift on Monday.
04-Dec-15 12:45 ET
SCALP
ScalpTrader: UVXY Update -- This is just very unusual action in the market. Price action like we've seen the past couple of days tends to lead to increased volatility. I'm going to keep this position as a swing. Will add another 1/3 every 0.50 lower. Adding another 1/3 here. (26.02 -4.18)
Stops are off for now.
04-Dec-15 12:36 ET
SCALP
ScalpTrader: UVXY Update (26.28)
Really having trouble clearing this 27.10 area. Have stalled out there about 4 times. I considered trading around it (scaling into $27.10, then buying back on weakness), which would have been very effective. However, didn't want to do all this work and then miss a run to $28. Now dealing with position coming back to lows. Keeping stop in the $25.70 area.
04-Dec-15 11:16 ET
SCALP
ScalpTrader: UVXY Additional Details (26.611)
From a personal perspective, I'm actually increasing the size of my scale in down here, as I really like this zone for a bounce.
04-Dec-15 11:12 ET
SCALP
ScalpTrader: UVXY Long Details (26.43 -3.78)
Right now have a 2x position in UVXY after continuing to scale in on weakness. Have seen instrument give back almost all of yesterday's gains, which is uncommon from what I have observed over the years following a major spike in volatility. Market has pushed further than I thought, but pullback in UVXY is allowing me to get my cost basis down. Expecting at least a 1-1.5 pt move higher from my last entry or more should market roll over late. Simply trading a set-up that I've seen a number of times in the past.
04-Dec-15 11:00 ET
SCALP
ScalpTrader: UVXY -- Adding final 1/3 (26.40)

04-Dec-15 10:55 ET
SCALP
ScalpTrader: UVXY Update -- I'm going to take stop down to $25.70 for now, just in case we get a flash down in this. Not expecting it but have seen it before. Will add another 1/3 if we see $26.30 area. (26.74)

04-Dec-15 10:50 ET
SCALP
ScalpTrader: UVXY Update -- Adding another 1/3. We have a nice squeeze going on in the market, but I still see prospect of uptick in volatility as day progresses. Getting my cost basis down. (26.76)

04-Dec-15 10:46 ET
SCALP
ScalpTrader: UVXY Update -- Putting on that additional 1/3 here. Stops in the $26.25 area. Will add another 1/3 if we see $26.70 (27.02)

04-Dec-15 10:39 ET
SCALP
ScalpTrader: UVXY Update -- Going to add another 1/3 if we see $27.00. Stops to $26.25 area. (27.20)

04-Dec-15 09:46 ET
SCALP
ScalpTrader: UVXY Update -- Adding another 1/4 here, bringing this to a full position. Stops in the $26.40 area. Will add another 1/3 if we see $27.00. (27.37)

04-Dec-15 09:42 ET
SCALP
ScalpTrader: UVXY Update -- Putting on another 1/4 here. Will add more if we see $27.45 area. (27.85)

04-Dec-15 09:38 ET
SCALP
ScalpTrader: UVXY follow-up -- If you were not able to get filled after the initial post, would consider starting to scale in here. (28.53)

04-Dec-15 09:33 ET
SCALP
ScalpTrader: UVXY Scalp Long -- risking 2 pts, going 1/2 size. Will add more if we see $27.50 area. (28.44)
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As I've said before---the only edge available to the retail trader is Prudent Risk Management.
 
Buy1Sell2 said:
As I've said before---the only edge available to the retail trader is Prudent Risk Management.
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Risk management is not what is typically thought of as an edge- positive expectation on bets/trades. Risk management deals with variance.

Without "positive expectancy" on your bets/trades, you will be a long-term loser.

Exaple:

A. Every dollar bet is worth 1.01
B. Every dollar bet is worth 1.00
C. Every dollar bet is worth .99

Only in example A can a trader apply prudent rusk management and win in the long run.
_____

But I think your idea is that solid risk management is very important, is very importantl.
 
777 said:
Risk management is not what is typically thought of as an edge- positive expectation on bets/trades. Risk management deals with variance.

Without "positive expectancy" on your bets/trades, you will be a long-term loser.

Exaple:

A. Every dollar bet is worth 1.01
B. Every dollar bet is worth 1.00
C. Every dollar bet is worth .99

Only in example A can a trader apply prudent rusk management and win in the long run.
_____

But I think your idea is that solid risk management is very important, is very importantl.
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Incorrect. ------Prudent Risk Management creates positive expectancy.
 
Buy1Sell2 said:
Incorrect. ------Prudent Risk Management creates positive expectancy.
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Unless we are misunderstanding terms, you are incorrect- flat out wrong, so let me see if we are just on different pages:

It is well known that there is no risk management/money management scheme that will make a dice player or a roulette player a long term winner because the player has a "negative expectation" on every bet he makes.

Just like if I let you bet heads on my trick coin that will randomly throw only 40 percent heads, you will not win in the long run no matter how you jiggle your bets (assume i am bankrolled).


Do you agree with this well known fact?

______

Perhaps you are not using the term "positive expectancy" as statisticians, professional gamblers, trading quants, etc would use the term.

Here is how those people think of/define the term:

https://en.m.wikipedia.org/wiki/Expected_value
 
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