Quote from wiesman02:
Well guys, 2.5 months later, and I'm throwing that strategy away completely. Gonna give you all a brief synopsis of my thought patterns and you may respond if you like.
[goes on to elaborate about experimentation]
Then..
I disagree. I will not lose $50k trading. No way in hell. You must not have had a clue what you were doing.
I've blown up a $10k swing trading account before. But I dont intend on doing that daytrading. My system works too well for that. At worst I'll be a net loser, but not to the tune of $50k.
From Mandelbrot:
P.S. I just saw your reply, and I certainly think/hope that will be true for you. But just remember, trading involves a whole host of psychological issues as well as an inordinate amount of knowledge to able to consistently succeed at it over a long period of time. Many many traders who have substantially more to work with than we do (in terms of money, education, resources, experience, knowledge) have bitten the dust, so the most important think to take from this process is to stay humble (at least when actively trading), most don't.
Weisman:
You need to get some humility ... yes, a lot of negativity on this board, but you need to be objective is possible.
Here's how I see it: you are in the process of attempting to find a system, but are almost entirely shooting blind in the dark [like most traders are].
I had a horrible 2007. I lost half of my savings (my entire trading accts) doing exactly that -- sure, I could even say some of it was gambling mentality trading. In fact, when I look back on it, deciding the fine line between gambling and 'risk controlled discretionary speculation' was difficult to do.
And it was hell of a lot more than 50K.
Now what did I learn? I did not have a strategy, or a plan. I was naive to think a few big kills could get me anywhere. I was changing strategies too often. I was breaking every old-school rule: adding to bad trades, adding to good trades [because I had no system, again], throwing money management out the window, etc.
But most of this ridiculous behavior came from not having a strategy and not believing that I was going to be one of those
idiots. Well, I did become that, if dictated by my trading account balances.
Now I'm back to the drawing board working on designing some auto trading systems backtested 5 years at least, hopefully not vulnerable to over-formfitting and optimization pitfalls, not vulnerable to excessive commissions or slippage losses, and not correlated to eachother in market environments.
And you know what I'm learning? I don't understand how anyone who isn't a market maker can actually make a living in these markets on
short term trading (scalps, and very short term swings) without a system that takes the human component of execution out of it. It simply introduces too much potential for abberation. Furthermore, when you step back (like I'm forced to), you realize that most of these guys on this board are in the same shoes I was in a year ago - without a decent system (some call it an edge), and just great hopes from the reliance on their self belief and perception of self-capabilities. Maybe they are hopefully wise enough to step back before they lose it all.
But without a system worked out, your profitability will be determined more by luck and market conditions than perhaps by any brilliance you possess. And I ask the better question: How can you be anchored to stay in these markets and be profitable if you never know for sure that your trading ideas are quantifiably good? [and I'm not telling you to quantify their validity based on other people's opinion] All it takes is one day of getting carried away doing countertrend buying or selling on a day that penetrates through multiple support levels, averaging in (not stopping out successive trades) ... just ONE day of divergence from your system that doesn't go your way, and you get behind the 8-ball. Etc etc..
very difficult stuff to reconcile, and I wish you luck. I'm still trying to find something better within myself.
