Kudos to MMs

Quote from piezoe:

What i look for is the slope of the regression line on the equity curve, after costs, to be positive, and a standard deviation about the regression line ideally no larger than the magnitude of the slope. Positive slope required for profitability, low variance for consistency. "Edge" is directly proportional to slope and inversely to the standard deviation about the regression line, hence a quantitative measure of edge is: e = m/s.
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I would add the number of trades to this equation:
e = sqrt(trades) * m / s

since (s / sqrt(trades)) is known as the "standard error", the original equation can be rewritten as:

e = m / standardError

This may also be recognized by some as Van Tharp's "System Quality Number".
 
Quote from Maverick74:

Nitro, you can raise taxes 50% for all I care. That is not my argument. My point is, just like backing a bad trader, you are throwing good money after bad. You have very little knowledge of political history. In 1982 and 1990 our congress basically made the deal you suggest. We had a government shutdown basically and came to a standstill. Democrats said, if you give us the tax increases, we'll cut spending. So both Reagan and Bush Sr did just that. We raised taxes. And what did congress do? They spent more money. We went deeper into debt and those budget cuts never came to pass.
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Ok. So your premise is that because those Democrats went back on their word 30 years ago, that there is no way to make law so that those lessons learned cannot be amended into a bill today? Man, don't make a mistake in Mavericks house, or you will pay forever! If that is the way we looked forward, by looking backward, we would never have become the nation we have become, and we would have never forgiven Germany for TWO WORLD WARS or the countless other mistakes that have been made in world history.

“Spending cuts are the same thing as a tax increase.” - Tim Geithner

I'm all for raising taxes. But only after reform these social programs and cut spending. Then raise taxes to 90% for all I care.

And btw, you seem to have trouble understanding why there is a wealth gap. The rich DO NOT earn more then the middle class. They simply have assets that inflate more. Most rich people don't have "earned income". They have investment income. As their assets go up in value and as the middle class goes deeper in debt, the math becomes very easy to understand. The only way to bring that back in alignment is to actually confiscate the assets of the rich. That's called communism. And I know you don't support that. So it's a moot point.
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Hmmmm, while I don't disagree in spirit with what you are saying, I think it terribly terribly oversimplifies the problem. Let me think about the best way to put it, but basically you are saying that corporations get wealthier because the effect that inflation has on their investments. That is just plain wrong.

The trading analogy is actually a good one. In trading, 5% of the traders earn 100% of the pie. The rest make little to nothing. If you were going to pay a tax and have that tax invested with someone, who would you pick, someone in the 5%, say Steve Cohen? Or some guy on ET that has lost money every year for 20 years. What if I told you that guy really needed the money Nitro. His kids are hungry. He is behind on his mortgage and he is about to lose his home. His family has no health insurance. Would you back him now? No, you still wouldn't.
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What?
 
Quote from nitro:

Ok. So your premise is that because those Democrats went back on their word 30 years ago, that there is no way to make law so that those lessons learned cannot be amended into a bill today? Man, don't make a mistake in Mavericks house, or you will pay forever! If that is the way we looked forward, by looking backward, we would never have become the nation we have become, and we would have never forgiven Germany for TWO WORLD WARS.

“Spending cuts are the same thing as a tax increase.” - Tim Geithner



Hmmmm, while I don't disagree in spirit with what you are saying, I think it terribly terribly oversimplifies the problem. Let me think about the best way to put it, but basically you are saying that corporations get wealthier because they inflate their investments. That is just plain wrong.


What?
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Nitro. The last 30 years? Try the last 3k years. LOL. And it's not just democrats. Republicans do the same thing. Governments over spend. That is just a fact of life. You can't regulate that anymore then you can drugs or prostitution. Man's shortcomings are imbedded in everything we are. All we can do is remove the temptation. Let government spend all they want with what "we give them".

I'm saying wealthy individuals own assets. Stocks, real estate, art, intellectual property, etc. These things are inflated over time. The poor benefit very little from this. The rich benefit a lot. Steve Jobs "earns" exactly $1 a year in salary working for AAPL. He will pay no federal income tax on that. But if you like, we can take the full dollar from him. Where his "real" money is made is on his stock. And if he doesn't sell it, we can't tax it!
 
Quote from nitro:

L Oct 1270 Call at SPX 1273, Delta ~53 (depends on where you compute the forward to be). Stop loss 1259. Will add on a cross above 1292, and above 1300.
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Well, whatever you bought (paper or otherwise) was stopped out. 1257.80 as I write this...
 
Stopped out at SPX 1259. Looking to get long the entire range of 1242 to 1250. If this loses 1242, I don't know that I could pull the trigger unless we crossed back above from below, above 1242, or God forbid, went to 1172. I don't see any major support between 1242 and 1172.

Needless to say, I am a bit shell shocked.
 
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