Sick of trading against computers
- Thread starter stock777
- Start date
I don't think a computer is necessarily better or worst than a human trader. A computer trading program is only as good as its human trader creator right?
But what trading system usually guards against are human errors and common follies (Fear and greed) and psychological blocks, etc. For that alone, probably accounts for 80% of the complains on this board. Like oh I got out too soon. Oh, I didn't observe my stops and I got hit hard today. Oh, I couldn't get in fast enough.
A well designed trading system should be able to remedy most of those issues.
But the caveat is that the BEST HUMAN TRADER will probably still outtrade the BEST COMPUTERIZED SYSTEM because there are certain subtle things that are difficult to capture(though not impossible at this stage).
But as daytraders , you have to be able to make SPLIT SECOND decisions and be COOL and CALM WITHOUT much emotional biases. So a machine can do faster executions and they have no emotions what so ever!
Perhaps, super long term traders or investors can outdo any computer program aka Warren Buffett , Peter Lynch, Bill Miller of the world. But when you are in a ultra-short term time frame where seconds or microseconds count and slippage and commissions are such a big component of your overall trading since your average gain per trade is so small, a computerized may give you an extra edge.
Plus, in manual trading, you can only trade at most probably 1-3 securites at a time. More than that it's hard to read the tape and follow every single prints. But a trading system can do whatever you do and apply it over hundreds of names at once..
just a thought...
This is the problem from my perspective. I go back to the SOES bandit days. You could trade against standing orders based on the tape. MM's on Nascrap could not use SOES to fill thier orders.
Now they can. And they take out 1 or 2 or 3 levels AT ONE TIME. So if you are scalping, you are chasing price, or miss the trade entirely.
The point is , the computer is faster than you. And there are few computers trading DUMB. That's a bunch of nonsense.
Swingtraders, position traders, guys holding for hours, this is not much of an issue.
Now they can. And they take out 1 or 2 or 3 levels AT ONE TIME. So if you are scalping, you are chasing price, or miss the trade entirely.
The point is , the computer is faster than you. And there are few computers trading DUMB. That's a bunch of nonsense.
Swingtraders, position traders, guys holding for hours, this is not much of an issue.
Interesting... I am convinced that ATS are still in advance, but that the possibility exists that it'll be like in chess:
when (I think) Kasparov played against one of those supercomputers (was it deep blue?) and he won the game, he replied that his strategy was to beat it on a strategical level - he knew that the computer would outsmart him on short-term moves, so he successfully concentrated on the long term strategy and beat it.
For non-trending situations:
What do people estimate the time offset is between markets nowadays?
It seems like it is better because of computer ATS's.
I do see the compression and extension is a lot swifter when the direction changes. It holds for a long time too.
Some reversals can seem premature as a consqequence. So sometimes I sit in neutral territory before making money again. I've been using different approaches according to liquidity and volatility. Cover and wait when things are light and reverse when volume is strong and steady.
One nice thing about ATS's is that the formations are cleaner on price in daily ranges 10 points or under.
What do people estimate the time offset is between markets nowadays?
It seems like it is better because of computer ATS's.
I do see the compression and extension is a lot swifter when the direction changes. It holds for a long time too.
Some reversals can seem premature as a consqequence. So sometimes I sit in neutral territory before making money again. I've been using different approaches according to liquidity and volatility. Cover and wait when things are light and reverse when volume is strong and steady.
One nice thing about ATS's is that the formations are cleaner on price in daily ranges 10 points or under.
Computers follow rules
Once you know those rules - you can use them to your advantage.
Traders, like idiots, are unpredictable. THAT gives them the ability to survive and adapt
Once you know those rules - you can use them to your advantage.
Traders, like idiots, are unpredictable. THAT gives them the ability to survive and adapt