Real Trading Strategies

Originally posted by shortseller
cut losses short and let profits run ... thats all there really is to it... i read a book that filpped a coin on to enter the market long or short at random and made money as long as they cut loss quick and let profits run... its mentally hard to do tho. thats where experience comes in.
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BS. I know it sounds cool for someone who has no idea about what is going on in the markets and wants to get into trading fast and make a fortune: "hey, all I gotta do is take a random position and then just manage it but cutting losers and letting winners ride"... BS Unless you have a valid reason to belive that the position you are taking is more likely to go the way you think it will (in the direction you expect AND by the MAGNITUDE you expect. Otherwise, you'll lose your shirt on commisions and on the multitude of losers you'll keep cutting short.
It's a very simple simulation - program a random walk and see what would happen.
On the other hand, if you did have a trading rule accoring to which if you turned out to be right, the stock would keep going in your direction (i.e. it's not random), then it's a different matter.
If it were as easy as your book claimed, all the people on this board would have been very wealthy by now.... All there would be to it would be to program the computer and go play golf.
Keep dreaming. Unless you do a lot of work to find a rule that works, you'll have to simply be VERY LUCKY to survive. No free lunch.
 
Originally posted by daniel_m


how do you know this? if it's just from the spread sheet he shows you, i'm sorry, that does not qualify as evidence if you ask me.
i really couldn't care either way, he does or he doesn't, and i would have no reason to doubt that he does, but i've actually heard from a couple of sources (who, to me, it is reasonable would, or could, know) that he's actually down in his trading account for the year.
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This is very possible - we all have drawdowns and Don may be in one and I have not kept up with Don's trading RECENTLY...

FWIW, the trades that he has done with his brother alone are bigger than my year. If he is down this year, I would not be surprised, as his health has been a major concern, and in order to trade you need all your strength and FOCUS...

nitro
 
Originally posted by easyrider
I guess what Im asking is: is there any benefit from helping other traders to improve?
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Not really. Unless you have a large enough following and then front-run them :D In all other cases, if competition improves, more arb opportunities are likely to disappear.
 
Well, now that you've explained your situation, it looks to me like the issue comes down to whether or not you want to be a trader enough.

Someone who's more familiar with scalping dynamics than I am might be better able to assess whether or not there's some realistic way for you to improve your performance without radically altering your style, but, if you really have hit a dead end, then you'll very likely have to put in a lot of time and sacrifice, possibly quite substantial time and sacrifice, learning some alternative or complementary styles. You could try alternative daytrading styles or you could also get into swing trading, position trading, or even into long-term fundamental style investing. Even if you're not starting out like a complete newbie, you might find your patience (among other things) being tested. If alternative lifestyles or professions seem equally appealing to you and probably more rewarding, then why trade?

I could tell you something about my own approach, but I can't claim to have been more successful with it than you have been scalping. I don't feel I've yet realized its full potential, by far, but - please correct me if I'm wrong - it seems to me that you're looking for something a lot more immediate and possibly even formulaic...
 
Originally posted by Kymar
Someone who's more familiar with scalping dynamics than I am might be better able to assess whether or not there's some realistic way for you to improve your performance without radically altering your style, but, if you really have hit a dead end, then you'll very likely have to put in a lot of time and sacrifice, possibly quite substantial time and sacrifice, learning some alternative or complementary styles. You could try alternative daytrading styles or you could also get into swing trading, position trading, or even into long-term fundamental style investing. Even if you're not starting out like a complete newbie, you might find your patience (among other things) being tested. If alternative lifestyles or professions seem equally appealing to you and probably more rewarding, then why trade?

I could tell you something about my own approach, but I can't claim to have been more successful with it than you have been scalping. I don't feel I've yet realized its full potential, by far, but - please correct me if I'm wrong - it seems to me that you're looking for something a lot more immediate and possibly even formulaic...
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Kymar thanks for posting a reply. Also once again thanks Silk for some good posts.

I trade because I like the money potential, enjoy the competitive nature of it, like that it changes day to day (except for the snore fest days we have been having lately), and I enjoy the hours. At this point there is not another profession that I would find equally appealing so that is out of the question. I realize that I need to add another component to my trading that is why I started the thread.

I was looking for a little inspiration and to be able to discuss strategy with some real traders (like in an office) so that I could refine what I wanted to do. I could get a little input on what seemed to be working for some people, what wasn't, and different angles to look at how traders approach the same problems of trading choppy and trending markets. I was also kind of interested to see how many real traders were on this site, who put real money in the market, and who really traded successfully for a living. So many posters on ET rabble on in many threads like they have all this knowledge and trading experience. They give out advice and tell other traders how wrong they are, how right they are, and write up long posts they cut and paste out of a book. I wanted to see who would step up to the plate since its seems like everyone is an expert on many other trading subjects. I have not been too impressed though. You can start to tell who really trades and who doesn't by their posts. Too bad so many traders come here looking for inspiration and knowledge, not knowing that the person on the other side of the screen doesn't really know what they are doing and is not really trading. I guess you have to know what ET is good for and not expect too much. Meeting and talking to traders in the real world is much more beneficial than this cyber crap.
 
Originally posted by downtickboy
I guess you have to know what ET is good for and not expect too much. Meeting and talking to traders in the real world is much more beneficial than this cyber crap.
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downtick, What you are really doing is sytem trading. You trade one system until it stops working, then you change to another system which at first seems to work, then it stops working and so on.

Maybe that in itself is a system which will work, who knows? But usually, anyone who comes up with a system intends to stick with it through the drawdown.

The mental aspects are so important, because if you aren't thinking right, you won't even see what you are looking for even though it is right in front of you.

Trading strategies are not that important. When you get your mind working right, you realize that you could make money trading any strategy that was put before you.

But trading strategies are important when you try to match them up with your personality.

Vladiators point is both completely true, but also in some sense false. No strategy is going to make you money in a casino where the odds are against you. But the odds in the market are not against you, so yes, you could and people do make money starting out with just a random entry.

You recognize that there is a problem, but you mistakenly think the problem is with the strategy. That is why you are frustrated with answers which try to address the problem instead of giving you the strategy which you think will fix the problem.
 
That is where we differ in opinion. I think trading is a combination of strategy and mental aspects. You could take a person with the best mental alignment for trading and give him a bunk strategy and he won't make a dime. The purpose of the thread was not to address the mental aspects. That has been discussed to death on other threads. I am not looking to have someones strategy fix my problem. I thought it would be an interesting topic and could be a way to look at the market different from my own perspective. Until proven wrong I am going to assume most traders talk about the mental aspects here because they are not making money with their strategies so they don't have any input in that area. The ones that are doing OK have shared their insights pretty freely. The rest seem are like psych majors who want to become psychologist so they can figure themselves out. However I come from the perspective that I don't mind helping other traders learn. I helped many learn along the way without getting anything in return. It is kind of funny to think that there are traders who feel that telling someone about the MA crossover or their relative strength strategy or whatever else, is actually going to effect their trading on some 5000 stocks or effect their entry in the futures market. I have become frusterated with answers because most are basically cutting and pasting answers from other threads. Most are not really addressing the topic. It becomes a circular discussion that never goes anywhere.
 
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