Identifying an edge

[erol]

Hello,


I've accumulated a lot of knowledge on how things work, and what to do when certain conditions are in my favour, however I suppose the challenge is knowing when to execute a trade.

I was wondering how you successful traders with an "identifiable edge" found your edge.

Is it a matter of data mining? Identifying patterns and back-testing to check if the validity of your (proposed) strategy?

I guess I'm just asking for a map, or a starting point.

 

[Ripley]

Quote from erol:

I've accumulated a lot of knowledge on how things work, and what to do when certain conditions are in my favour, however I suppose the challenge is knowing when to execute a trade.

I was wondering how you successful traders with an "identifiable edge" found your edge.

Is it a matter of data mining? Identifying patterns and back-testing to check if the validity of your (proposed) strategy?

I guess I'm just asking for a map, or a starting point.

The whole of ET is just noise. Just random noise. I would not call it an edge.

 

[Neenisti]

I for one am glad I found my edge before I got here.

 

[SnakeEYE]

Quote from erol:



Is it a matter of data mining? Identifying patterns and back-testing to check if the validity of your (proposed) strategy?

Combination of both.You may want to find a leading indicator of what you trade.Volume,VIX,Index et cetera..

Don`t pay attention to my previous post, though

 

[wrbtrader]

Quote from erol:

Hello,


...I suppose the challenge is knowing when to execute a trade...

I guess I'm just asking for a map, or a starting point.

Hi,

Take a close look in the mirror. You're that map or starting point.

Simply, there's more to profitable trading than patterns, TA, fundamentals or what ever you call your trading method. Thus, successful trading has many chapters and patterns, TA, fundamentals or any other aspect of your method is just a few chapters out of many chapters in that book.

Therefore, the other key chapters or arguably the most important chapters in that book involves many variables or concepts (e.g. market experience, money management, proper capitalization, stress management, discipline, proper trading environment and so on).

Also, try to see yourself as the coach of your team called trading plan. Next, try to imagine that your trade method involves just a few players on your team. Your job is to identify the other critical players on your team to make it a winning team. If the team (trading plan) fails...you'll most likely be looking for another job.

Once again, that starting point on the MAP...it's YOU.

Mark

 

[SnakeEYE]

Quote from wrbtrader:


If the team (trading plan) fails...you'll most likely be looking for another job.

Mark

Could you elaborate on what a trading plan is?Not in the context of the team that you provided as an example.

Thx

 

[wrbtrader]

Quote from SnakeEYE:

Could you elaborate on what a trading plan is?Not in the context of the team that you provided as an example.

Thx

You're asking me to elaborate or explain market experience, money management, proper capitalization, stress management, discipline, proper trading environment, trade method and so on...all of that working together to form a trading plan.

Mark

 

[Handle123]

Quote from erol:

Hello,


I've accumulated a lot of knowledge on how things work, and what to do when certain conditions are in my favour, however I suppose the challenge is knowing when to execute a trade.

I was wondering how you successful traders with an "identifiable edge" found your edge.

Is it a matter of data mining? Identifying patterns and back-testing to check if the validity of your (proposed) strategy?

I guess I'm just asking for a map, or a starting point.

Edge means as many different focal points as there are ways to trade. As one is groping along, when you think you are on to something, you get an unexpected drawdown just when you are increasing size, LOL. One can say it is backtesting, but if you can't pull the trigger, all the backtesting in the world is useless. One morning you just wake up, in my case disgusted at myself, and just start trading like your long backtested method has shown to do. But there are stairsteps, and your edge changes thru the years, and perhaps at some point, what you thought was your edge is 180 degrees different 10, 20, 30 years later.

 

[SnakeEYE]

Quote from Handle123:

Edge means as many different focal points as there are ways to trade. As one is groping along, when you think you are on to something, you get an unexpected drawdown just when you are increasing size, LOL. One can say it is backtesting, but if you can't pull the trigger, all the backtesting in the world is useless. One morning you just wake up, in my case disgusted at myself, and just start trading like your long backtested method has shown to do. But there are stairsteps, and your edge changes thru the years, and perhaps at some point, what you thought was your edge is 180 degrees different 10, 20, 30 years later.

But how about trading plan?It seems that you have a long trading life.Please tell me, what a trading plan is?

The former poster seems to be confused with explanation.

Thx

 

[wrbtrader]

Quote from SnakeEYE:

But how about trading plan?It seems that you have a long trading life.Please tell me, what a trading plan is?

The former poster seems to be confused with explanation.

Thx

I've told you what is a trading plan along with specifically naming key components of that trading plan. Yet, if you're looking for something else or more info...that's what I'm confused about what you seek.

If that doesn't make sense to YOU...that's my point to the OP in that the OP is missing something from his trading plan that confusing him about when to execute a trade.

Yet, we don't know the OP nor anything personal about the OP nor anything about the variables involved currently in the OP's trading plan. Those realities will make this thread short lived via the fact the OP will not find his/her own edge via what others say how they found their own edge.

Mark