strategy vs discretional trading in the ES/NQ

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pawpaw

Hoping to repeat the success of my first post...

I'm just wondering how many people use strategy or discretional trading for the index futures; I know this might lead to a neverending debate, but I'd like to have your comments anyway.

Do u think we can trade index futuers just with a sound and well tested trading system or maybe this can only be used as a helping hand to integrate dicretional trading?

Thanks for your comments
Pawpaw
 
We all have our own experiences... I lost money until I developed
a mechanical system. Maybe others can sit down and print money at will. I can't. Seems like the answer to the question would depend on the person.
 
I am a systematic discretionary trader, but I didnt vote for option 2, since thats not the same thing... my discretionary trading is systemized, but not based on systems, if that makes any sense...
 
Quote from candletrader:

I am a systematic discretionary trader, but I didnt vote for option 2, since thats not the same thing... my discretionary trading is systemized, but not based on systems, if that makes any sense...
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Do you mean, you have various strategies, each governed by a set of rules, and you choose which to follow as the situation permits? And maybe, in each set of rules, there are parameters you can set on the fly, such as profit target and initial stop?
 
Quote from peterfigliozzi:



Do you mean, you have various strategies, each governed by a set of rules, and you choose which to follow as the situation permits? And maybe, in each set of rules, there are parameters you can set on the fly, such as profit target and initial stop?
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Basically, yes... but the word "governed" is potentially too strong...
 
Strategy all the way. Who cares if i could prevent a single bad trade based on discretion, the only thing that matters is that at the end of the day i am profitable and at the end of each month i am consistent. There are way too many scenerios to be using discretion, way too much to analyze. And, it's impossible to know them all. If a system has a 70 or 80 % success rate, than who cares if you can prevent one or two bad trades from happening??? As long as you follow the system you will still be successful those 70 or 80 % of the times.

But, to each his own.
 
Every successful trader is using a "system" just as everyone has an accent whether they think they do or not. The difference is that some are using a system that is in their head and others are using a computerized system.

The system in your head is potentially much more complex than any computerized system as it can take into account hundreds of variables (economic reports, news alerts) and may adapt more quickly to changing conditions (ie: your brain is a pretty advanced pattern recognizer).

On the other hand a computerized system (by virtue of not being as adaptable) is also more consistent. It will do the same thing every time without fail. It will not skip a signal just because the market "feels" down or because of fear.

A human system knows enough to recognize that moment when she has nailed the top or bottom of the day and that it is time to toss all the indicators and just let the trade ride.

A computer system has the "nerve" to go long when everyone in the world is going short.

Most likely a great trader is better than any computerized trader and a good computerized trader is better than many bad traders. ;)

<a href="http://www.eminiblog.com">http://www.eminiblog.com</a>
 
Quote from ratso:

Every successful trader is using a "system" just as everyone has an accent whether they think they do or not. The difference is that some are using a system that is in their head and others are using a computerized system.
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Of course, that's precisely the reason some are not successful, because they do not follow any system. They might have not even identified a set of rules that they need to follow. Mechanical or nor, it does not matter. It is the rules that matter. If you have the rules then you have a system, if you don't you are a loser, sooner or later.
 
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