Quote from romik:
In gambling, the house always has an edge..
Edge or not, by definition, the house still gambles. The house gambles
with an edge, but gambles none-the-less. Using statistical probabilities in an effort to "become the house" in a trading environment is also gambling since the outcome of each trade (bet) is not known in advance. Just as the house knows they may lose any one bet, but over time (and given enough bets) the statistics (and the actual dollars) shift to their favor, so too with statistics and probabilities in trading, does a trader know any one bet (trade) might result in a loss, but given enough trades (and assuming the edge tested valid) the statistics (and the dollars) turn in their favor.
No amount of semantics can change what placing a directional trade (based on probabilities) really is - gambling - since one cannot
know the outcome in advance. It doesn't matter in the slightest what the
overall outcome is. The house gambles as do the customers. The house simply gambles with an edge. Without a doubt, some edges and some highly profitable (and predictable) strategies exist which employ such methods. It is not my attempt to knock those systems, nor disparage those traders which employ them.
However, strategies
do exist which fall outside the realm of edges, gambling and statistical probability. Signals exist (within the market framework itself) which indicate future price direction. How long or to what duration such signals last depends on the context (current trend) in which the signal occurs. They occur in
every market, and on
every time frame (provided sufficient liquidity exists).
I
fully realize even posting the
possibility of such signals existing often results in massive flame wars, off-topic insults and charges of fraud. I have neither drank the sacred Kool-aid, nor do I have anything to sell. I have no intent of engaging in such activities. However, if one knew Event A resulted in three possible outcomes
100% of the time, and each of those outcomes (1, 2 or 3) watched price move a little, a medium amount or a significant amount (feel free to insert your own definition of little, medium & significant) all in the
same direction, would you still call it gambling? Of course you wouldn't. Well such events occur day after day, market after market.
Now, do
not take my word for it.
For a moment, suspend your immediate (almost visceral) response to dismiss my post as utter bullshit and the ravings of a madman. Take a few minutes to see for yourself what exists outside the realm of "conventional wisdom" as preached so often by so many.
I have posted on this subject quite frequently recently, and ES has a few links he can share if he finds the subject matter on topic (I don't wish to take his thread further into the probability of a flame war). However, take a moment and investigate for yourself the
possibility of trading outside the box of probability and statistics. Others (some of whom have posted to this thread) have investigated for themselves, and have found unbelievable results.
Good trading to you all.
- Spydertrader
