Predicting randomness

[Cheese]

Quote from oddiduro:

Cheese,

I cannot help but wonder, what stops a competent trader from becoming a billionaire other than drive?

I assume you are a competent trader, that can also predict markets, based on your posts.....therefore would it not be logical to assume that becoming a billionaire is well within your reach?

A very good riposte, oddiduro.

The liquidity of the market you play in is the first limitation. But you will know that increasing and/or multiplying your stake in ratio to your capital base accumulating through profit addition is not a slow process assuming always that you are not removing any profit to spend.

Given that I may assume you are also a competent trader with drive, can I ask what answer do you give yourself?

 

[bdixon619]

Quote from oddiduro:

Has anyone stepped up and decided to predict what the price of any market they choose will be tommorrow. A margin of error of 0.1 percent will end this thread. I will reduce the challenge from five days, to just three. They must be consecutive.

Now, while this still falls under the parameters of luck, I contend that the markets are so random in movement that no one here can even get that lucky.

It seems to me you are attempting to equate unpredictability with randomness. Although generating truly random data is diificult...if this is your reason for concluding the market is random I would ask you produce the evidentiary data. Maybe, I've misread your words.

 

[oddiduro]

Quote from Cheese:

A very good riposte, oddiduro.

The liquidity of the market you play in is the first limitation. But you will know that increasing and/or multiplying your stake in ratio to your capital base accumulating through profit addition is not a slow process assuming always that you are not removing any profit to spend.

Given that I may assume you are also a competent trader with drive, can I ask what answer do you give yourself?

I had the drive, but then I lost it. I think once I truly had to face the tax system, I became curious about why the masses choose to live the way we do.

I wonder why more people are not in the markets.

I wonder why we don't percieve the perpetuity of the system. Every year they will make a new Lexus, when there is nothing wrong with the old one.

One can only efficiently utilize so much living space.

Women are natually attracted to stability, so that challege goes away.

Now I study and trade the markets from an algorhythm based on probability.

If I got a billion dollars, what would I do with it?

It is no longer safe to travel if you are an American.

If I give it away, it is more likely to exacerbate bad habits than help others get good habits.

I did not mean to insult you Cheese, I meant my question. Money only exists in our minds anyway. What stops anyone who truly understands the market from becoming a billionaire?

For me, I found that the logical extension is that it would not bring me any lasting peace.

Best Regards
Oddi

 

[oddiduro]

Quote from bdixon619:

It seems to me you are attempting to equate unpredictability with randomness. Although generating truly random data is diificult...if this is your reason for concluding the market is random I would ask you produce the evidentiary data. Maybe, I've misread your words.

I have none.

Do you have evidence to the contrary?

 

[jaronimo]

Quote from cnms2:

To me being billionaire is a measure of selfishness. On your road to becoming one there are so many missed opportunities to share your wealth. If you become a billionaire you're an as* hole in my book. There's no reason to keep so much money for yourself. To be able to make billions is enviable, but to be a billionaire is not. This applies to most multimillionaires too.

Thats a tough critique on those that are extremely successful. Just because they have made a ton of money they have to give most of it away?

I have always heard you should tithe 10% of your pay to others. What if they bacame a billionaire and did this? Are they still a-holes of they are giving away hundreds of millions of dollars?

Where do you draw the line? What if a guy makes 50k a year? Is he an a-hole if he does not give away a portion of it? Or 25k? Or 100k?

This isn't meant as an attack, I am just curious on how you came up with these thoughts? Also, I know one person that is a billionaire, Not sure how much, if any he gives away, but he doesn't really strike me as an a-hole. And its all from a business he started in his garage.

 

[Cheese]

Quote from cnms2:

To me being billionaire is a measure of selfishness. On your road to becoming one there are so many missed opportunities to share your wealth. If you become a billionaire you're an as* hole in my book. There's no reason to keep so much money for yourself. To be able to make billions is enviable, but to be a billionaire is not. This applies to most multimillionaires too.

I don't think your post needs an answer.

You are wrong to think that the human condition shared by you and I departs because you are or you become a multi-millionaire or a billionaire. Bill Gates is a gigantic donor to good causes.

The distribution of 'arseholes', I suggest, is probably evenly spread across the social spectrum from the lowest going up to the very highest or there may even be more 'arseholes' per 1000 at the lower end of the scale. Perhaps you could help me by putting that proposition into computer science terminology.

 

[Cheese]

Quote from oddiduro:

I had the drive, but then I lost it. I think once I truly had to face the tax system, I became curious about why the masses choose to live the way we do.

I wonder why more people are not in the markets.

I wonder why we don't perceive the perpetuity of the system. Every year they will make a new Lexus, when there is nothing wrong with the old one.

One can only efficiently utilize so much living space.

Women are naturally attracted to stability, so that challenge goes away.

Now I study and trade the markets from an algorithm based on probability.

If I got a billion dollars, what would I do with it?

It is no longer safe to travel if you are an American.

If I give it away, it is more likely to exacerbate bad habits than help others get good habits.

I did not mean to insult you Cheese, I meant my question. Money only exists in our minds anyway. What stops anyone who truly understands the market from becoming a billionaire?

For me, I found that the logical extension is that it would not bring me any lasting peace.

Best Regards
Oddi

I did not take your question as an insult. I took it as a good question to answer.

The more money you have the more it increases your freedom and choice. But yes, money itself only exists in the mind. I am motivated by 'game play measurement' as certain others are when it comes to money games or the effort to gain money. I judge money as measuring my advance in a game. Trading is the most real game you can play.

You are right though; the markets will not stop any winning player, who understands the markets, from making a billion.

Perhaps I would agree with you that no one should look to money to give you lasting peace. Peace or contentment are choices open to every one and are personal decisions.

 

[bdixon619]

Quote from oddiduro:

I have none.

Do you have evidence to the contrary?

Not exhaustive evidence but I have it in two different ways: price only and (adv/dec issues and adv/dec volume) as a prediction of price movement. But this does not speak to your question of specific price predictions...in that context I would think using a neural net and confidence intervals would be sufficient to make a profit. Of course, someone sufficiently interested is going to have to determine the weights of his exogenous factors after he has determined what those factors are to be. Next, he would need to determine to what degree of confidence he was willing to accept the prediction and either buy or sell his options.

Adv/dec issues and adv/volume are only two factors I used for my Excel spreadsheet. Implementing a neural net requires more of an investment of time to make a dollar. Intellectually, the exercise of implementing just such a strategy is stimulating but I never put much faith in my ability to write options.

Peters http://www.amazon.com/gp/product/04...4?v=glance&n=283155&n=507846&s=books&v=glance proved that markets are not random and that financial markets do have a long-term "memory" component. In other words, in the long term markets are driven by previous prices. In the short-term markets can be characterized by a Markov chain. This is what I used in my work in market price movement. While, this is a study inherently associated with independent events it does not preclude the existence of tradable trends within the data. That perspective is definitely close to randomness. But as long as you want to play the short-term trend it is okay to treat the trends themselves as non-random events. In other words, the trend is your friend. But, this is blowing as far as I am concerned. As VN points out above, trend-followers are not doing very well. Just look at JW Henry's results in this month's Futures. He is a trend-follower.

I realize I haven't even attempted to predict any prices for you...but I know of no quicker way to appear foolish. Therefore, I will not. As to the other thing I've talked about, I prefer trend following, the market allows this as a viable trading behavior, and VN's opinion comes from a different perspective. I think if trend following were as easy as I suggested the trend followers VN refers to would be better at their jobs. I won't speculate on how Vic makes his money these days.

 

[Perseus]

I would love to be a billionaire, and I would not care one cent about anyone calling me an asshole. In order for a bloke like me to actually become one I need some lucky breaks and 100% dedication to point of excluding all else in my life. The former is unlikely and the latter makes it pointless, for me, to even try and think about it let alone actually pursue it.

I am in no position to critique anybody btw, I have done nothing but lose money.

 

[cnms2]

Quote from jaronimo:

Thats a tough critique on those that are extremely successful. Just because they have made a ton of money they have to give most of it away?

I have always heard you should tithe 10% of your pay to others. What if they became a billionaire and did this? Are they still a-holes of they are giving away hundreds of millions of dollars?

Where do you draw the line? What if a guy makes 50k a year? Is he an a-hole if he does not give away a portion of it? Or 25k? Or 100k?

This isn't meant as an attack, I am just curious on how you came up with these thoughts? Also, I know one person that is a billionaire, Not sure how much, if any he gives away, but he doesn't really strike me as an a-hole. And its all from a business he started in his garage.

I don't advocate giving away indiscriminately, au contraire: you can do a lot of good things with your money, i.e. for your family and friends, but also for some deserving causes like education, health, or whatever else makes you tick. Try for a moment to imagine that you don't have to work for a living anymore. What would you do everyday? How much money would you need to support that indefinitely? The rest, you can put it at good use, either yourself if you're so inclined, or through somebody you know and trust. I don't advocate giving away indiscriminately. Just accumulating more money will not make you happier, and proves at least your lack of imagination. I think.