I'm glad you become calm again, 2manywhiners!
I usually leave the person alone when it is furious. It's the best to both parties. Only time can cure one's emotions. Only if it's calm will I come back and explain since only calm people will open their ears.
I'm glad to answer your questions from now on since I know you will listen now.
I have never left my state of calm. I'm a practitioner of laughing meditation. I like to incorporate humor into my posts. Sometimes it's a superior path to getting the attention of others.
Just because I said...
I may officially retract some of my previous statements concerning you WmWaster, but only if you clarify how you see yourself fitting into the above quote. Who are you on this list?
...Doesn't mean I'm now flip-flopping and siding with you or anyone else. I honestly wanted to know what you consider yourself to be on your Novice/Intermediate/Expert statement. Which was it? I didn't hear a specific answer. I gave one though...
I myself would have to claim Intermediate for the channeling of my psychological emotions. As well as both Intermediate and Expert as pertaining to the education from mine and others' lessons.
Now I suppose I'm even more curious, where do
you see yourself? I'm pretty sure I already know the answer though...
Now ignore what I say about psychology first. Do you agree the above criteria are important as a successful winner and simulated trading can help you achieve all of them (except psychology)?
If so, there's no reason why you need skip the step of simulated trading, no matter your status about psychology.
And to reply to your question, No I don't agree with your statement. I will, however, do what few people on ET actually do, I will support why I do, and why I don't agree with it.
Green = yes I agree,
Red = No I do not agree. Let's play.
First what's the use of a complete simulated trading. It's to:
- help testing your trading methods/rules/systems
- help testing your money management & position sizing
- be familiar with your trading software and execution procedures (it's more important if you intraday)
- be familiar with your decision making procedures & reaction (it's more important if you intraday)
- simulate your psychology (the hidden values!!)
Now I want to support why I
disagreed.
Numero Uno: Position Sizing. In theory, Simulators will help beginners to learn and/or calculate appropriate position sizing. In reality, Live trading will not always allow you to buy or sell the appropriate number of shares you intended to buy or sell. This is called a partial order. See also: d) and e) on page 14's a) through p) list.
Numero Due: Execution Procedures. In theory, Simulators allow beginners to learn how the execution of orders takes place. In reality, order execution does not reflect Simulation. Some orders are filled almost instantly, and with the full number of shares as was requested. Some orders take many seconds or several minutes to fill. Some orders fill only a part of the intended number of shares. Some orders fill after several minutes, and then only are partially filled. Many orders are never filled at all. I'm not just talking about limit orders either, any of the above examples can, and do, occur with market orders as well. See also: a), b), c), d), e), and m) on page 14's a) through p) list.
Numero Tre: (Decision) Reaction. In theory, Simulators allow beginners to learn how to take the appropriate action and react to a specific movement in the market. In reality, this is not always possible. When you have decided to react to a move in the market, whether it be a decision to buy or sell, you will not always be able to obtain the entire position size, or exit from the position as soon as you wanted. When volatility increases, supply and demand becomes skewed. This is why there are so many rapid fluctuations in price over such a short period of time. The reason traders are able to obtain the biggest price movements in such short periods of time is directly related to volatility. Supply becomes restricted, demand signifigantly increases, and the result is a large move upward in the price of the stock. 1000 people want to buy it, 250 want to sell it, and somewhere in between, 750 people get left out. This is a major reason why large price fluctuations trade on very little volume, and are accompanied by slow price movement periods that trade on such high levels of volume. Just because you
wanted to react to an occurance in the market, doesn't mean you will be
able to. See also: b), d), e), n), and p) on page 14's a) through p) list.
Numero Quattro: Psychology. In theory, the mindset of trading with dollars that aren't real can be ignored, and replaced with the mindset that every fake dollar is as important as every real dollar. In reality, a very, very select few people may be able to do just that, but many, many people will not. period. I've already given my take on the psychology of trading with fake dollars versus real dollars. Besides, you asked me to ignore the psychology aspect so I will.
So the next question is whether a successful simulated trading guarantee a successful live trading. That's the distinction between intermediates and experts. An intermediate has to go through live trading, learn from their mistakes, and grow up. It's nothing wrong but you need to spend more bucks before you win. An expert can avoid these unnecessary costs.
My answer? No. Successful Sim trading can help a new trader, this is true.
BUTT, most new traders, regardless of whether they trade Sim or Live, are simply not prepared. Plain and simple. They often know what is happening, but rarely know why. That, along with the inability to adapt to change, is why the vast majority of traders fail. Now, as far as your association with traders who start Live being intermediates, and traders who start on a paper trading repitoir similar to yours being Experts...
That's just plain false. It's Wrong. It's Not true. And its down right criminal to imply so. I'm not saying that skipping Sim trading will make any new trader anything but a novice. Regardless of how the vast majority of traders start trading, Live or Sim, they're almost always wrong. Those who start out
UNPREPARED will lose. They don't get it. They are stuck on their ignorance, and they refuse to adapt.
AGAIN, I'm not saying either way is right, I'm saying most people are just doing it wrong. Sim trading has its downfalls [See page 14's a) through p) list.] Most Sim traders overlook these when starting out Live. The ones who decide to learn why they're losing, or not trading as well as they were (since you insist there is at least one trader who started out profitable), will figure out what the differences are. Those who do will usually "Get it." Those who don't just keep trading, with a dumbfounded look on thier face, until their account runs out, or until they give up and start paper trading again. The latter example will not fix the problem. I think...
JimmyJam said it best:
If you've traded live you know Paper Trading can help you develop a system which has positive expectancy, but when you execute it you probably will experience emotions which hadn't factored into The Plan. If The Plan is good it will carry you through any potential drawdown into profitability, or you will realize your error(s) and go back to the drawing board.
If you've Traded Live you know that there is nothing like it in terms of what you experience and (hopefully) learn from your trading. If you've got a winner, you know it (and somewhere along the way you will realize why they traders who fail, do).
Ultimately, it's your money so you have to decide what, where, when and how you choose to trade.
As far as the rest of your post... smoking is a bad analogy. Many smokers smoke until they die of cancer. Same thing here with most unprepared traders, wait maybe that actually was a good analogy...
Last but not least, I think this question is most concerned by you. "Did you gain just after your sim trading?" I'm reluctant to answer because I know you cannot gain by a straightforward answer. I wish you can understand and judge based on the descriptions, reasons & explanations I offer, not just a simple answer. You can't learn from it. You might even fail since you have no faith/understanding on it. It's like you'll probably screw things up if I just give you the secrets of trading straight away. If you see & understand my way of sim trading will lead you to success, you will follow religiously and follow successfully.
But I think you wish to know now because you can't judge based on my explanations, or you need some confirmations. Then I can tell you: "Yes, it's what I did, and how I succeeded for the very first time I trade with my first trading methods! New traders, you could do the same as long as you know how to sim trading in my way!"
Forget humor, this is down right comical. Ha.
You see the point?