Trading is like business, not math, physics, engineering or science

[Wide Tailz]

For one main reason: the physical world acts equally instantly and infinitely (within our human limits to measure) on objects with physical laws. F=MA (the acceleration formula) does not have a quantity limit, nor does F=GmM/r^2 (the law of gravity), at least on our human world. You can drop 1 apple or 1000 at a time, they all accelerate the same.

However, there are only so many burger joints that can be profitably run in Mojave, Ca (or other restauraunts, for that matter). The one hobby store in town quickly shut down, even though the place is crawling with aerospace nerds that love model planes.

Competition exists in business, but rarely do physical laws interact with each other or break down under huge quantities of actions.

As traders, are we chasing obsolete methods that worked before neural networks, machine learning and backtesting, behavior modeling and spoofing came into the arena? There is only so much room for the various services we provide to the market (liquidity, price discovery). But you can't open a K mart next to a Wal mart. It will die a quick death. Remember the turtles?

 

[traider]

A lot of people will claim that the turtles method still kinda work

 

[savoir]

Trading is a game. You are not producing anything or providing a service. If you are providing liquidity to others, unless you are a market maker capturing the spread, you are what is called in the academic literature a futile trader, which is a nice way of saying you're a loser.

To play the game well, you should be a liquidity taker not a liquidity provider. You take liquidity ahead of the majority who need it and will push price in your favor until you are no longer in the minority at which point you take profit. If you are really skilled, you take liquidity again ahead of the new majority as a reversal.

To reiterate, trading is a game. If you play it well, you can direct the money you extract from the market to productive uses such as supporting a desired lifestyle for yourself and supporting others who need support. If you are business inclined, like I am, you can partner with others who are experts in their field and need capital to run a business that produces products and provides services. Some people buy real property and collect rents. Personally, I do not like being a landlord so I do not buy real property unless I can use it. To each his own.

 

[traider]

Trading is a game. You are not producing anything or providing a service. If you are providing liquidity to others, unless you are a market maker capturing the spread, you are what is called in the academic literature a futile trader, which is a nice way of saying you're a loser.

To play the game well, you should be a liquidity taker not a liquidity provider. You take liquidity ahead of the majority who need it and will push price in your favor until you are no longer in the minority at which point you take profit. If you are really skilled, you take liquidity again ahead of the new majority as a reversal.

To reiterate, trading is a game. If you play it well, you can direct the money you extract from the market to productive uses such as supporting a desired lifestyle for yourself and supporting others who need support. If you are business inclined, like I am, you can partner with others who are experts in their field and need capital to run a business that produces products and provides services. Some people buy real property and collect rents. Personally, I do not like being a landlord so I do not buy real property unless I can use it. To each his own.

deciding when to hold or fold risk is providing a valuable service. Check out all the top insurers in the world

 

[savoir]

deciding when to hold or fold risk is providing a valuable service. Check out all the top insurers in the world

Oh really? I had no idea a futures contract and an insurance contract were equivalent. I considered my activity in the market as parasitic. It's good to know I'm providing a valuable service to the counterparties I'm taking money from.

 

[TrAndy2022]

Trading is much more an art than science.

 

[BlackPhoenix]

Trading is much more an art than science.

Renaissance Technologies likes to disagree

 

[tsfx]

Trading is much more an art than science.

Art is nothing but an advanced science. You'll figure that out once AI technology improves to a level where magic starts to happen.

 

[themickey]

Trading reminds me of my hobby where I am attempting to design a fishing rig which drags your line offshore from the beach without using motors.
I've been working on it for years, not full time, but several hours a month usually, either designing or building or testing.
I've made probably more than a dozen prototypes which eventually all got scrapped.
The early models were all complicated.
But it amazes me how the simple ones (the current ones) were so elusive to imagine or design.
With trading imo, simplicity is difficult to achieve, but gives the best results.

 

[oshjdf]

It's definitely a business which requires basic math/stats to calculate whether your trading system has +ve expectancy or not regardless of your trading system approach to the market (pure charting, order flow, algo, etc).