1. Should a person relatively new or inexperienced be trading to start off with? Should someone come into this thread, take what talon, you (I do like you) or I am mentioning and place their money on it?
My opinion states a clear NO.
2. The fact that people lose money = risk. EVERY TRADER has a losing trade, EVERY SYSTEMATIC TRADER deals with failed models. Some idiotic poster/guru in ET may read this and start disagreeing but it happens to everyone (Please don't tell me every model you develop makes money... well you may be an exception from a lot of us...). Though deleted, my emphasis on starting a topic about risk management starts there.
3. Honestly... my emphasis wasn't about following a scientific process... though, now that you've mentioned it, I agree. (Seriously, I never thought of it that way) The intention is rather simple... Do your own tests / thinking. Just let talon know what you're doing and I'm sure he'll tell you what you're doing right / wrong.
4. In terms of limited knowledge... considering your background... would you ask your professor a question where the answer is written in the textbook? When you wrote your thesis, didn't you run your own set of research to make sure no one else has written about the same topic?
Look... it is quite obvious that people hasn't used Google to search their questions they ask. In terms of port. analysis... wouldn't you expect people to actually write "Portfolio Analysis" in google? When I sent the query... I got a bunch (32,300,000 queries) about the topic. Also, my friends and previous mentors are actually traders... and they don't have a lot time... if someone had the slightest consideration and understanding about the business, I would try to condense their effort and generosity by eliminating useless questions.
Seriously, talon is a nice guy. He actually takes time to provide people but the people receiving the information needs to be equally considerate. One thing I learned being in this business is that people relationships are a 2-way street... you have to be equally professional as a student as much as the mentor being a professional. And... you have some people in here that asked questions, complaining about the industry??? Gimme a freagin' break... some obviously don't deserve to be hired... they have issues before their intelligence.
So I'm not asking people to be more experienced. I'm asking people to be more considerate for talon as a trader. It's not an easy job, and obviously it's not a 9-5 job too. Many people don't know what respecting is about.
That all said... having a well thought out question is a matter of respecting the person who's teaching you. Sure this is ET and it's the internet, you deal with a lot of BS. But so far, everything talon has done is legit and deserves the (professional) respect that he deserves.
5. It's going to be a repetition but am I asking too much for people in an internet forum? I don't think so, if you think this thread is as viable as I feel it is... then you should agree.
Full blown honesty... It really pisses me off that talon isn't getting the respect he deserves... and what's more pissing me off is that people have no idea about respecting a trader who takes his time to post in here.
Before you go off asking him to give you a bunch of shit... think about whether you deserve it. At least in my real life environment, we have an iron clad respect to each other.
PS. Mike... I not pissed off about you.
Quote from Mike805:
TSG,
You may have addressed this in a round-about way, but, I think that your comments regarding inductive/probabilistic reasoning are slightly mis-leading and possibly flawed.
You're asking people, many of whom may be new or relatively inexperienced, to hypothesize and test the validity of their hypothesis on their own. This process is also known as the scientific method. While this process will come easy to anyone with a decent analytical background, a hard prerequisite is a strong analytical mind. That said, ability to perform this process does not mean much in our business. You can do everything right and still lose money because of what you don't know you don't know...
Semantics aside (per the scientific method and the details involved), what questions would one start asking given their knowledge of portfolio trading risk management is limited? Suppose one has a strong quantitative background and very good systemic development ideas. The fact that the future is unknown presents many challenges and problems that only experience can teach. One can't ask pertinent questions unless one has the pertinent experience. Even then, the future will present a new set of challenges...
Unfortunately, gaining experience usually involves losing money.
My take is that you're telling the people here that they need to ask pertinent and well-thought questions, especially when it comes to risk management. Talon presented a hard case example, suppose you trade a portfolio of 50 stocks and one day your system goes long 42 of em... what does one do? What questions should have one asked prior to this experience?
Rather than tell people they need more experience to ask the right questions, a more helpful approach would be to share some experiences.
How do you limit position sizing with respect to account size? What's a general rule? How many positions based on the portfolio?
When does applying discretion make sense?
Do you adjust for volatility?
None of the above questions ask one to reveal their edge or their process. They are basic questions that are system specific. You've seen the system and you have some basic questions.
Again, rather than provide color to this discussion regarding the inadequecy of a posters thinking process, please provide some general experiences when trading a system such as the one talon provided. I know you said you're not answering questions so I'll let this sit for a few days until you or someone else answers and then I'll provide some of what I've experienced...
Mike
P.S. I learned all of the above the hard-way, i.e. losses. It doesn't have to be that way. Think of this as indirectly contributing to charity.
