Prudent Risk Management Is The Only True Edge In TRADING

[taowave]

OP failed along with the 30% who voted for the "ONLYTRUE EDGE"....

Seriously,there is only ONE ??

Like Morpheous and Nio???

 

[ironchef]

OP failed along with the 30% who voted for the "ONLYTRUE EDGE"....

Seriously,there is only ONE ??

Like Morpheous and Nio???

@taowave, I have been thinking about this problem for a while. Used to think it is total BS. Lately, I re-read this @Buy1Sell2 thread a few more times and began to wonder.

To satisfy my itch, I ran a simulation, using a Markov market model (as a null hypothesis), to simulate day trading. Imposed all risk management rules etc., then made a few tens of simulation runs over this weekend.

Guess what: The net outcome was profitable!

Either there is an error in my code, or a few tens of cases is insufficient, or maybe we should listen to @Buy1Sell2?

 

[taowave]

There is no question that if you cant control risk,you cant TRADE successfully...

That was never up for debate...

Its not the Only True Edge

@taowave, I have been thinking about this problem for a while. Used to think it is total BS. Lately, I re-read this @Buy1Sell2 thread a few more times and began to wonder.

To satisfy my itch, I ran a simulation, using a Markov market model (as a null hypothesis), to simulate day trading. Imposed all risk management rules etc., then made a few tens of simulation runs over this weekend.

Guess what: The net outcome was profitable!

Either there is an error in my code, or a few tens of cases is insufficient, or maybe we should listen to @Buy1Sell2?

 

[ironchef]

There is no question that if you cant control risk,you cant TRADE successfully...

That was never up for debate...

Its not the Only True Edge

OK, professor, enough is enough, I will stop beating the dead horse.

And I will stop trying to find positive expectancy from trading a set of random number, like inventing a perpetual motion machine.

 

[taowave]

Hey,it could be your edge..Who am I to judge??

I did like the book, "best loser wins"..

OK, professor, enough is enough, I will stop beating the dead horse.

And I will stop trying to find positive expectancy from trading a set of random number, like inventing a perpetual motion machine.

 

[savoir]

***
I did like the book, "best loser wins"..

I read it over the weekend. The psych parts are from the Mark Douglas cookie cutter. Regardless, it was a quick read and not dull at all. The reference to Liar’s Poker brought back good memories.

Would I recommend it to others? Not really. But I wouldn’t not recommend it. I don’t think reading any particular book will turn anyone’s trading around from losing to winning. Anyhow, I now know where you got the “perfect your craft” phrase from that sounded odd to me when you used it.

 

[taowave]

Did I actually say perfect your craft??

Yikes!!!!

P.s. If I did say it,I thought it was a Taowave original..

I read it over the weekend. The psych parts are from the Mark Douglas cookie cutter. Regardless, it was a quick read and not dull at all. The reference to Liar’s Poker brought back good memories.

Would I recommend it to others? Not really. But I wouldn’t not recommend it. I don’t think reading any particular book will turn anyone’s trading around from losing to winning. Anyhow, I now know where you got the “perfect your craft” phrase from that sounded odd to me when you used it.

 

[savoir]

Did I actually say perfect your craft??

Yikes!!!!

P.s. If I did say it,I thought it was a Taowave original..

Maybe not exactly that phrase which is what I quoted from the book. You repeatedly call trading a “craft” which is what I found odd. I think you told SimpleMeLike to “commit to your craft” in the Newbie thread.

 

[taowave]

Oh yeah," commit to your craft" is definetly something I would say

Maybe not exactly that phrase which is what I quoted from the book. You repeatedly call trading a “craft” which is what I found odd. I think you told SimpleMeLike to “commit to your craft” in the Newbie thread.

 

[Buy1Sell2]

@taowave, I have been thinking about this problem for a while. Used to think it is total BS. Lately, I re-read this @Buy1Sell2 thread a few more times and began to wonder.

To satisfy my itch, I ran a simulation, using a Markov market model (as a null hypothesis), to simulate day trading. Imposed all risk management rules etc., then made a few tens of simulation runs over this weekend.

Guess what: The net outcome was profitable!

Either there is an error in my code, or a few tens of cases is insufficient, or maybe we should listen to @Buy1Sell2?

Excellent posting and thanks for the extra look. Yep, PRM is the only true edge in trading.