Some Technical Questions

[Straitjacket]

With regards to MAE / MFE debate, perhaps they can be used as an input for what I am trying to measure. But on its own, it seems incomplete.

What I’m trying to do is “handicap” a trade and then subsequently measure how well I’ve done (over time).

So I need a way of estimating (1) the odds of risk/return at the time the trade is entered and before I know the results. I do not want to use historical data (well only to help my guess but I do not rely on it). Then after the trade plays out... I could use (2) MAE / MFE to measure against my estimate for (1) to help me determine my “handicapping” accuracy.

Does my logic make sense? Is there another measure that is more suitable?

 

[Straitjacket]

Wow...so you've been trading (although on simulator) without designating profit targets (what it should be) prior to entry...

That implies you're trading via an incomplete trade strategy which also implies you're trading via a trade method that's not backtested.

Someone that does the above on the Emini ES futures is trading backward.

wrbtrader

I cannot refute what you are saying. However, I don’t agree with it.

There are many traders who have EOD exit parameters. If my exit parameters are fluid but based on a theory and estimate, isn’t that an exist strategy?

Why do specific parameters of a trading plan have to be numerically rigid?

 

[ironchef]

you are wasting your time.

I am saying this as a 20 year veteran, having made enough from the market for financial freedom.

read thru my posts and see if this style makes sense to you.

your questions are irrelevant.. simply waste of time.

or - switch to landlording... the success rate is far higher

replicating the trading or the financial freedom?

for the latter I have posted a few times about playing the positive sum game.. $1k a month for 20 years, plumber can million... everybody can replicate.

the trading - yes, sentiment.. my pro boys do it all the time, but they have maybe better tools to gauge, and they have control of media... easy to replicate? no... but what is easy in trading?

you start with 13% a year, get that IRR up there to 15%, won't take long to million.. easy math.

this 'flat at the end of day' stuff, only for losers who still live in mom's basement, and have no other skill to find a job, in this hottest job market.

Don't you think you are a little bit too negative? After all this is a forum for active traders. You are telling a bunch of kids in an NBA camp training to turn pro to quit trying?

 

[Straitjacket]

This time frame belongs to the robots. Beginners often are attracted to it due to the perceived safety of flat overnight.

There is no money to be made here. 1% makes enough to live on. The other 99% live in the basement.

The key question is. What is the path of least resistance. To the lowest hanging fruit. To replicate the financial freedom.

What proportion of the intraday volume is legitimate buying/selling? (Whether by bots or not?) Does anybody know?

Wouldn’t real buying/selling have an even bigger price effect as the proportion of bots increases? Just guessing here...I’m no expert on microstructure.

 

[dozu888]

What proportion of the intraday volume is legitimate buying/selling? (Whether by bots or not?) Does anybody know?

Wouldn’t real buying/selling have an even bigger price effect as the proportion of bots increases? Just guessing here...I’m no expert on microstructure.

Quick google indicates 80% is program trading? But even if it’s only 30-50% that’s already too much noise from emotionless machines.

Human emotions are tradable. Machines are not.

 

[qlai]

Human emotions are tradable. Machines are not.

Everything is tradable ... Just like in poker, we are looking for tells. If the volume may cause change in price, it's real no matter what causes it.

 

[dozu888]

Everything is tradable ... Just like in poker, we are looking for tells. If the volume may cause change in price, it's real no matter what causes it.

in theory yes.

to me it's just lower hanging fruit to trade against amateur human beings as their emotions and tendencies are so predictable.

I have been tracking the forexIG sentiment for a couple of years... but nowadays I can actually guess the long/short ratio just based on the price movements alone.

 

[wrbtrader]

...$1k a month for 20 years, plumber can million... everybody can replicate...

The cost of living will keep you in the poor house. In fact, if you make 1k per month while living in San Francisco...you'll be homeless or sleeping in your van that's coverted into mobile house.

I guess you forgot about the cost of living (e.g. food, rent, taxes, student loans and many other typical things we hear about in the media).

This is why I've been saying for about 10 years now...the markets is slowly becoming a market for the rich. Small guy will no longer be able to play nor grow any small account.

wrbtrader

 

[wrbtrader]

I cannot refute what you are saying. However, I don’t agree with it.

There are many traders who have EOD exit parameters. If my exit parameters are fluid but based on a theory and estimate, isn’t that an exist strategy?

Why do specific parameters of a trading plan have to be numerically rigid?

Of course there are many traders with an end of day exit parameter...if they're profitable why are you not trying to duplicate thteir exit strategy when in fact you stated you trade with no profit targets ?

wrbtrader

 

[dozu888]

The cost of living will keep you in the poor house. In fact, if you make 1k per month while living in San Francisco...you'll be homeless or sleeping in your van that's coverted into mobile house.

I guess you forgot about the cost of living (e.g. food, rent, taxes, student loans and many other typical things we hear about in the media).

This is why I've been saying for about 10 years now...the markets is slowly becoming a market for the rich. Small guy will no longer be able to play nor grow any small account.

wrbtrader

oh i meant saving $1k a month and throw into qqq... (related to an earlier post)...

a market for the rich - true in 2 ways.

- technology has enabled ever fast accumulation of wealth to the top of the pyramid;
- after the 2000 and 2008 crash, the public participation in stocks has been low by historical standards... and therefore the ownership is concentrated towards the institutions, and corporate insiders.