The ACD Method

Quote from Maverick74:

Let me address this. I think what Fisher meant, is that people over complicate the "execution" of trading. Trading itself should be easy enough for an 8th grader to do. That's just using ACD to actually execute a trade. Know your bias, know your entry, what you are risking, and where you get out if you are wrong. I could teach that to an 8th grader. Now, finding an edge...that's a "little" bit harder. LOL. You have to work for the edge. I think I'm stating the obvious here. But actually executing that edge should be child's play. Does this make sense mdl? So I don't think he was talking out of both sides of his mouth. He just talks really fast. :)
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Yes, that makes more sense.
 
Quote from Maverick74:

Great question mdl. Let me just say, Fisher and I are in complete agreement on this. Fisher has stated many times that he reads everything under the sun. He probably spends 60 hours a week just collecting information alone. He has stated this on one of his videos and in another article online about him. This is the part I truly believe most guys don't get. Trading is really really hard. There is no point in your life where you just have it figured out. Where you have a system and you just wake up and execute it. That is a pipe dream. I wish trading worked that way. But it doesn't.

I have stated this several times on this thread that ACD is about "price action". Price action is a very long drawn out process. It requires one to know "everything" that is going on in all the markets and have the ability to ascertain what exactly everyone is focusing on at that exact point in time and how they are reacting to it. This is an up at dawn, round the clock process that cannot be streamlined or minimized so one can spend the rest of their day at the beach.

Honestly, this is why most of the guys in my office failed. They never understood this. And believe you me, I beat it into their head on a daily basis. There is no point in your life where it starts to get easy. You have to work at this every single day the rest of your life. This is the part I have mentioned on here where guys realize this and begin to lose interest in trading. They get told in seminars in hotel banquet halls and in books that they too can make a living trading working only a few hours a week or on the weekend and who the hell wouldn't want that? Hell, I would love that. I do have other hobbies I would like to pursue. LOL.

BTW, this has nothing to do with analysts over analyzing things on CNBC. They are talking about long term fundamentals for the most part. I'm talking about price action. Two very different things. I hate to break anybody's heart here. But Fisher has talked about this. So has Paul Tudor Jones. Two of the greatest trading minds we have have both said exactly the same thing almost word for word. And I am in complete agreement with them.

I can assure you that the market pays no mind to squiggly lines on a chart or what "my important levels" are. The market is a million times more complex then that. Believe you me, I would love to be able to trade from a yacht entering trades when two squiggly lines crossed each other. But that is a fantasy. The dirty little secret most parents don't teach their kids is that to get anywhere in this world, you really do have to work for it and don't stop till you think you have enough. There are no cruise control buttons in life.
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I see in agrrement with Maverick to a degree. I work full time at a job which pays welll in 6 figures, and trade to get out of that rut. I only trade the 2.5 most productive hours of the day, but put at least 2-3 hours homework in to prepare for this short period so I have my decisions on what I will do with price action pre-made. Some is news driven, the remaining on preparing my ACD entries, now combined with camarillo pivots, if the price action says these are good decision points. I trade equities, with some spreads such as the SPY - FXE.

I once took a logical trader class with mark for the make a wish foundation. It was interesting how he focused so little on the method but on understanding the world and news.
 
Quote from gptrader:

I see in agrrement with Maverick to a degree. I work full time at a job which pays welll in 6 figures, and trade to get out of that rut. I only trade the 2.5 most productive hours of the day, but put at least 2-3 hours homework in to prepare for this short period so I have my decisions on what I will do with price action pre-made. Some is news driven, the remaining on preparing my ACD entries, now combined with camarillo pivots, if the price action says these are good decision points. I trade equities, with some spreads such as the SPY - FXE.

I once took a logical trader class with mark for the make a wish foundation. It was interesting how he focused so little on the method but on understanding the world and news.
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I understand this works for you with your limited amount of data points. But let me play devil's advocate. Let's say you are making a meaningful return doing this. Hell, any positive return above the risk free interest rate. Why would any hedge fund or prop firm spend millions of hours working at this if they could run a 3 hour a day 5 day a week operation and generate edge?

This is not directed at you personally. I always ask guys this as a way to think about what they are doing. I use to ask guys who told me they would make 50% a year trading iron condors why no hedge funds or investment banks trade them and make 50% a year. Why do they hire 1000's of quants to make 12% a year if making 50% a year is so easy trading condors. I never would get an answer.

I know a lot of guys in this business that don't know what their kids and wife look like because they work so hard trying to eek out a few extra basis pts a year. If one could trade 3 hours a day and generate some edge, I would think most if not the entire industry would do it. Just something to think about. I ask myself this question all the time.
 
Quote from Maverick74:

I understand this works for you with your limited amount of data points. But let me play devil's advocate. Let's say you are making a meaningful return doing this. Hell, any positive return above the risk free interest rate. Why would any hedge fund or prop firm spend millions of hours working at this if they could run a 3 hour a day 5 day a week operation and generate edge?

This is not directed at you personally. I always ask guys this as a way to think about what they are doing. I use to ask guys who told me they would make 50% a year trading iron condors why no hedge funds or investment banks trade them and make 50% a year. Why do they hire 1000's of quants to make 12% a year if making 50% a year is so easy trading condors. I never would get an answer.

I know a lot of guys in this business that don't know what their kids and wife look like because they work so hard trying to eek out a few extra basis pts a year. If one could trade 3 hours a day and generate some edge, I would think most if not the entire industry would do it. Just something to think about. I ask myself this question all the time.
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I like the devil's advocate, my answer is simple. I am well above the zero risk, and appproaching my salary with my trading. I do this so I can save much faster and leave the suit behind. On current pace, I am 3 years away from accomplishing this very important goal. As for family time, I get lots of quality time. I trade on west coast, so up 2 hours before everyone, it fits for me, and I know I am in a minority this works for.
 
Quote from gptrader:

I like the devil's advocate, my answer is simple. I am well above the zero risk, and appproaching my salary with my trading. I do this so I can save much faster and leave the suit behind. On current pace, I am 3 years away from accomplishing this very important goal. As for family time, I get lots of quality time. I trade on west coast, so up 2 hours before everyone, it fits for me, and I know I am in a minority this works for.
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Right, I know it works for you. But I'm curious why you think multi-billion dollar hedge funds don't do this. They like their families too! LOL. At least some of them do. :)
 
Quote from Maverick74:

Right, I know it works for you. But I'm curious why you think multi-billion dollar hedge funds don't do this. They like their families too! LOL. At least some of them do. :)
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I don't know why or their goals. Perhaps hidden in there is the why. I trade my method, have different goals than most (I don't know another technology VP that works and trades actively). The hous required for me to make money trading is less than a hedgy, very simple. Now that my trade plan for tormorrow is ready except for pre-market review, I am off to the beach with my wife and a massage :)
 
Quote from gptrader:

I don't know why or their goals. Perhaps hidden in there is the why. I trade my method, have different goals than most (I don't know another technology VP that works and trades actively). The hous required for me to make money trading is less than a hedgy, very simple. Now that my trade plan for tormorrow is ready except for pre-market review, I am off to the beach with my wife and a massage :)
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Their goals are to make money. You didn't answer my question. But that's fine. Happy new year gpt!
 
Quote from Maverick74:

I understand this works for you with your limited amount of data points. But let me play devil's advocate. Let's say you are making a meaningful return doing this. Hell, any positive return above the risk free interest rate. Why would any hedge fund or prop firm spend millions of hours working at this if they could run a 3 hour a day 5 day a week operation and generate edge?

This is not directed at you personally. I always ask guys this as a way to think about what they are doing. I use to ask guys who told me they would make 50% a year trading iron condors why no hedge funds or investment banks trade them and make 50% a year. Why do they hire 1000's of quants to make 12% a year if making 50% a year is so easy trading condors. I never would get an answer.
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Fair question, and very valid point.

I always thought its because firms had to find various edges to attempt to diversify their risk and use as many non-correlated strategies as possible, and avoid slippage.

Also they have to find multiple strategies in order put to work all that money they have. So in essence they need more edge producing avenues to spread out their capital, and multiple markets to do it with.
 
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