Three Pervasive Myths in the Trading World

HoundDogOne wrote.........

You are directly up against the top 5,000-10,000 Pro Traders in the world...
All of whom have talent, experience, killer instinct, capital.
To succeed... you will have to TAKE AWAY money from these guys...
Just like going one-on-one against Iverson.
...................................................................................

Excellent HoundDog----

This is an excellent statement...and to take it a step further...I have seen many doctors , lawyers, engineers....who were extremely intelligent in their work.......fail miserably in the marketplace......

In fact arrogance...and a lack of respect for what HoundDogOne just wrote ....is a statement they now appreciate a little more after some have lost hundreds of thousands and even millions of dollars.....
 
one myth that needs debunking is that myth that every time someone says they are debunking a myth they are always right
 
Perhaps another myth: why does everyone posit math abilities as an innate talent needed for trading? Sure if you're trading derivatives, arbitrage etc -- but I've never done a single math equation in my head in figuring out when to buy or sell in the past 8 years. It's enough just to let everyone else on the street price that in for you.

I could just as easily propose that a degree in art history would be just as useful -- pattern and trend recognition, compositional skills, just overall good "taste" in timing, all these can function as the equivalent (or better) of any computer algorithm.

(devil's advocate here, I just hate math)
 
Interesting thread.

The three myths:

Emotions are the root of trading problems; making a dedicated effort works; and loss of discipline

Just seem to be foils for the points that are made as the reality; these include, presumably:

Talent is important; acquiring skills is a real need; and having an edge is necessary.

HD1 chats about competing with others who have talent, acquired skills and edges.

Looks like all of this leads to a 25% annualized return over the years.

I have never seen an annualized return of 25%. The super pros playing in the big leagues look silly to me, as well.

Classifying myths while having a PhD sounds just as ridiculous. 100 person sample....LOL.....

If I have a list of 100 stocks that cycle at 20% every 15 days, wtf is a 25% annualized return?

If the ES moves 50% of margin every day, wtf is a 25% annualized return?

Skip the myths.

The principles are:

1. You have to be in the market to make money.

2. You have to stay on the right side of the market to make money.

So what are the rules of beating 25% a year annual returns?

1. Do a repeated routine of monitoring, analysis, decision making and timely action.

2. Collect profits at every reversal of the market.

Emotions? lol

Talent? lol

Discipline? lol

Consistency? lol

Most people have never seen the markets. This is the main clue for the PhD who deals with myths.

There is an elephant in the room. He is 20% every 15 days in stocks and 50% of margin a day in commodities. Do you see the skin of the elephant yet????? He's not on a basketball court.
 
Quote from jack hershey:



Most people have never seen the markets. This is the main clue for the PhD who deals with myths.

There is an elephant in the room. He is 20% every 15 days in stocks and 50% of margin a day in commodities. Do you see the skin of the elephant yet????? He's not on a basketball court.
More...


this is total myth. although returns like this happen everyday they are unsustainable.

the structure of the market simply will not allow the stated returns to be sustained.

regards,

surf
 
Quote from jack hershey:

...
Skip the myths.

The principles are:

1. You have to be in the market to make money.

2. You have to stay on the right side of the market to make money.
...
More...
mmm... sounds like SCT to me. Is it a coincident?
 
Quote from marketsurfer:

this is total myth. although returns like this happen everyday they are unsustainable.

the structure of the market simply will not allow the stated returns to be sustained.

regards,

surf
More...



Ain't simulators great!:D
 
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