Wanting to start a systematic trading approach

C

c.chugani

Ok. so after starting a thread in this very forum titled "serious newbie in search of knowledge" I have gone ahead and educated myself a bit more in this field.

My first impressions after researching much abt trading is that its a business based off the laws of probabilty. Where outcomes are never certain, but developing a systematic way of trading and an edge over the specific market you trade in are the ways to consistently reap profits.

So my questions are: where can I gain more knowledge on how to build a trading system suited for my needs? Do I HAVE to know computer programming for this? Is Excel a decent platform to use? (I am more at home with Excel than with any other programmes I have looked at.)

Also, which are the good books that teach you how to approach trading with a consistent trading system? Can start this plan on my own, or do you guys recommend starting with a brokerage company first?

I know that these are A WHOLE LOT of questions, but I feel that this is also the best place to seek the best advice from experienced ppl in this field.

Once again, thanx for your input.

Regards,

Chirag
 
Quote from c.chugani:

Ok. so after starting a thread in this very forum titled "serious newbie in search of knowledge" I have gone ahead and educated myself a bit more in this field.

My first impressions after researching much abt trading is that its a business based off the laws of probabilty. Where outcomes are never certain, but developing a systematic way of trading and an edge over the specific market you trade in are the ways to consistently reap profits.

So my questions are: where can I gain more knowledge on how to build a trading system suited for my needs? Do I HAVE to know computer programming for this? Is Excel a decent platform to use? (I am more at home with Excel than with any other programmes I have looked at.)

Chirag
More...

Why reinvent the wheel ,unless you are a very very talented programmer,and feel you can build a better wheel??

Save yourself the TIME and aggravation and purchase a system backtester that is on the market..

Start with Traders Studio,Wealth Lab,AmiBroker or Neoticker.They are all excellent products and can do almost anything you come up with..

I havent read a trading book in quite some time,but I do think Van Tharps books were excellent...

i also enjoyed reading Market Wizards.....

But definetly start looking around for a good software package
 
Excel is not good for serious trading because you need to reinvent the wheel too much . Reports, Technical indicators ect.
Excel also does not have a backtester , you can code it for simple systems but more complex ones will cause you problems.
Take a look at my TradersStudio. The language is a lot like Excel VBA. It is a cross between VBA and TradeStation's EasyLanguage.

You can look at a overview of TradersStudio here.

http://www.tradersstudio.com/Overview/tabid/68/Default.aspx
 
Hi c.c.,

There are a broad range of views on starting and running systematic trading approaches.

Your self education has defined for you some of the beliefs that people build upon, conventionally, to achieve the results that are widely known. These results parallel the story of how small businesses operate and may be even more severe in their failure rate.

My thoughts on where you are are not conventional I am told and, further, 4 out of 5 perons think they are bullshit, to put it mildly. I do operate from a systems analysis viewpoint, however, and it looks like you may be giving an SA approach a change to help you out.

Thus, the only reason I am posting to you is because you are asking starting a systematic trading process. The the vast majority of people do not start or operate systematic systems.

I do not want to expand upon thescope of your thoughts initially because it is probable that I will be seen as taking over this thread by provoking a lot of responses, anyway.

I parsed your topics below.




Quote from c.chugani:

Ok. so after starting a thread in this very forum titled "serious newbie in search of knowledge" I have gone ahead and educated myself a bit more in this field.

This is one one the two major paths. The other is to work with and along side an expert. It is never too late to scout your local territory to find a few and chose one.

My first impressions after researching much abt trading is that its a business based off the laws of probabilty. Where outcomes are never certain, but developing a systematic way of trading and an edge over the specific market you trade in are the ways to consistently reap profits.

Your eight points represent a common approach that is not very systematic. By that I mean mostly each of the points are not in-depth type things and as you say they are only first impressions.

I would not procede to followup on these things until you have a few other impressions that do not even overlap these. You have, in fact missed the major aspects of making money in markets. By missing out on these considerations you could prevent yourself from having a trading opportunity at all in the final analysis.

First impressions have a common characteristic. they are easy to come by and they are shallow and their shortcomings are not too obvious since they are the party line usually.

Inmarkets common sense is not useable. This is primarily because the market does not del in opposites and the minority always rule when money can be made. This is a tough thing to not know and employ in your thinking processes.

So my questions are:

1. where can I gain more knowledge on how to build a trading system suited for my needs?

find a mentor locally.

2. Do I HAVE to know computer programming for this?

not at all your mentor has it done already.

3. Is Excel a decent platform to use? (I am more at home with Excel than with any other programmes I have looked at.)

this will be handy for your business plan and for small routines done daily.

4. Also, which are the good books that teach you how to approach trading with a consistent trading system?

I have 35 favs that I use to redirect people away from their contents. But do read Larry Harris's Traders and Exchanges.

5. Can start this plan on my own, or do you guys recommend starting with a brokerage company first?

Get a mentor.

6. I know that these are A WHOLE LOT of questions, but I feel that this is also the best place to seek the best advice from experienced ppl in this field.

This place will take you further along the lines of your first impressions.

Once again, thanx for your input.

Regards,

Chirag
More...
 
Excel is more than what you need to start on this.

I have a very nice package of excel add-ons, including technical indicators, automation, back-testing, portfolio management, risk analysis etc. comes with a very very nice simple language to construct strategy. if you're interested let me know.

after you master everything with excel, and only-and ONLY if you need faster more analysis beyond the scope of excel, then learning a progamming language can help.

you can start this plan completely on your own.
 
You see people,

being a newb in this world is pretty aggravating. There's too much info, sometimes it makes things more complicated than what they should be.

I really don't know how to proceed. Should I get to reading more abt trading? How do I actually START trading? With what tools, what systems, which risk management principles, how much intitial capital, through which brokerage firm, etc. etc.

the doubts in my mind are neverending. It seems as though I need some coaching on this field. I follow the Spanish markets (I live in Spain btw) religiously and keep track of the stocks that compose the major spanish indices. I do my research, look for edges through technical indicators with historic data, etc. etc. But I still cannot see clear patterns or indications of where the trend is heading.

I really love this world, but at the same time I find the amount of info, options, competition and overall pace of this field really mindboggling.

I yet don't know how to ACTUALLY START TRADING!!

Any advice to give a distressed beginner?
 
Getting an edge on any market is a ridiculous long term goal. It will never happen, do you actually believe throwing a few stats into an excel program will make you profitable. You should always trade with the market never against it. Learn by watching a basket of selected stocks on a per trade basis for a month and develop a feel for them. Then learn to spot and interpet what the stocks are trying to tell you. Tape reading will become instinctive, chart reading will never tell you when to enter or exit a stock with enough accuracy.
 
Quote from c.chugani:

You see people,

being a newb in this world is pretty aggravating. There's too much info, sometimes it makes things more complicated than what they should be.

I really don't know how to proceed. Should I get to reading more abt trading? How do I actually START trading? With what tools, what systems, which risk management principles, how much intitial capital, through which brokerage firm, etc. etc.

the doubts in my mind are neverending. It seems as though I need some coaching on this field. I follow the Spanish markets (I live in Spain btw) religiously and keep track of the stocks that compose the major spanish indices. I do my research, look for edges through technical indicators with historic data, etc. etc. But I still cannot see clear patterns or indications of where the trend is heading.

I really love this world, but at the same time I find the amount of info, options, competition and overall pace of this field really mindboggling.

I yet don't know how to ACTUALLY START TRADING!!

Any advice to give a distressed beginner?
More...

Here is one thing I have seen by so many beginners in this field. By knowing this maybe it will help you find what you are looking for.

This is the normal progression for traders as I see it.

1. You buy some books about technical analysis and read them.
2. You start applying what you have learned.
3. You start hearing about all these new indicators and how great they are
4. You play around with them while mostly losing your money
5. You keep reading and playing around with more indicators
6. You keep putting money in your account to keep it funded
7. You realize that all you need to trade is on the chart
8. You sart making money

The time it take you to get from step1 to step 8 only you can decide but the quicker the better.

Good Luck,
4re
 
For a guy that is starting out, do you people recommend to swing, position or day trade?

I plan on risking part of my own savings. Currently 5000 euro.
Instead of buying the stocks I'm going to concentrate on the options of the blue chip spanish stocks as well as on the whole index. (Atleast like that I shall have some leverage, since my starting capital is a pittance).
 
Work hard, have dedication, it's kinda funny, i had about 3 newbies ask me something similar, which is fairly common, and this is when I was just starting, and none of them are still here, and I don't have contact with any of them, but one of them admitted they blew it, the other two, I'm sure of the same fate.

They always asked me questions and stuff, not willing to put in the work.

So I have learned from others mistakes. Be sure to learn from what I have just said and do your own research and try out things, because asking a bunch of random people on a forum, even though people here intend on helping you, they will not be able to tell you how to trade because you should trade the way you feel you should and the way you are comfortable with, and if you haven't even determined if you should day-trade or swing-trade, I already know your setting yourself up for failure if your not willing to try it out for yourself.

Just some brain food, hopefully it helps.

This might or might not have anything to do with this, but I was asked very similar questions and knew the people, and I believe the reason they failed was they were looking for a system already built and all that, so again, just some advice to give you a better chance of being successful than they were.
 
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