The most efficient method of trading

[Sekiyo]

Pretty sure most traders aren’t able to define what’s efficiency in trading

 

[longandshort]

I haven't posted for a while in this forum, but have been wanting to share my main takeaway from my 23-plus years of trading experience, and wanted to see what other members thought.

While traders are bombarded with technical and fundamental analysis, I have found from my own trading results, and from the results of the other successful traders I have been surrounded by, that it's not fanciful candlestick patterns that bring big and consistent profits, the strategies that offer the most edge are what I call "glitch strategies".

I will use the word “glitch” to describe a malfunction, mispricing, arbitrage, or inefficiency within a market. A good example in the equity markets are opening and closing auction strategies. Another example might be inter-exchange arbitrage. These kinds of strategies, though hard to find, do exist in all markets, and when discovered and utilized can bring almost unlimited profits.

My goal isn't to list a bunch of strategies, but rather share this approach to trading, and see if other members of the forum share my same outlook, or might suggest markets that may be "ripe with glitches"

In Wall Street parlance these glitches are called “market anomalies” and explain the difference between the actual trading data vs a hypothesized model (like efficient market hypothesis). Practically all professional trading strategies are rooting in systematically extracting the returns from these anomalies, and the workflow of the trader or analyst is designed to highlight and evaluate them.

 

[stewbacca]

Yes, you are spot on. This "method" of trading is not a secret, rather it's just ignored by most independent traders. Most traders want to speculate, guess and let ego get in the way. Wall Street and "traders in the know" accept that finding a strategy with an edge and then mechanically executing this strategy is really the only way to succeed. And finding "edge" has nothing to do with fanciful technical patterns.

 

[Bandiginn]

I haven't posted for a while in this forum, but have been wanting to share my main takeaway from my 23-plus years of trading experience, and wanted to see what other members thought.

While traders are bombarded with technical and fundamental analysis, I have found from my own trading results, and from the results of the other successful traders I have been surrounded by, that it's not fanciful candlestick patterns that bring big and consistent profits, the strategies that offer the most edge are what I call "glitch strategies".

I will use the word “glitch” to describe a malfunction, mispricing, arbitrage, or inefficiency within a market. A good example in the equity markets are opening and closing auction strategies. Another example might be inter-exchange arbitrage. These kinds of strategies, though hard to find, do exist in all markets, and when discovered and utilized can bring almost unlimited profits.

My goal isn't to list a bunch of strategies, but rather share this approach to trading, and see if other members of the forum share my same outlook, or might suggest markets that may be "ripe with glitches"

Wow... the experience is inspiring.
Still I don't believe in the existence of any profitable strategies, even despite the fact some of the man really be handy and have good indications. Trading is a very fickle thing and after a series of harsh fluctuations of the price of certain asset, or, having a news background, the same strategies don't work. Thus you should work on a new one.