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What is your edge ?
- Thread starter oilfxpro
- Start date
TheBlackHand
Guest
Quote from the1:
Douglas talks about this in his book, Trading in the Zone, and he refers to it as "just knowing" or having the ability to "intuitively" read the markets. It's like having a 6th sense. You're just tuned into the movement of the market.
Yeah right.
Try telling that to the HR manager at a top hedge fund why they should employ you and your strategy.
' well, eeer, I kinda just know. You know. You ever get that feeling? Like you know - when you're at Vegas, and you just KNOW - I mean FREAKING KNOW the balls going to land on red and....'
For the record, an edge doesnt have to be unique to the individual or strategy. All casinos have an edge, and it's the same edge for all of them. Basis trading provides an edge, and it's the same edge shared amongst everyone who does a basis trade.
An edge is any approach that has a proven statistical positive expectancy whne executed.
What an edge is not is mysterious or rocket science, related to psychology or other some such
TheBlackHand
Guest
Quote from deaddog:
My calculated edge based on actual trades is 1.8% or for every $1000 I put into a trade I expect to make $18. No I donât make that on every trade, sometimes more sometimes a lot less but over the period of a year Iâm fairly confidant that I will come close to that number.
Thats not an edge.
You're better off sticking your money in an account that pays out 2% or more. It's safer and more rewarding.
IMO, an edge should return more than the risk free rate - otherwise there is no edge as the risk is too much.
Quote from TheBlackHand:
What an edge is not is mysterious or rocket science, related to psychology or other some such
+1
In fact a real edge mitigates the need to be smart or have a certain psychological profile:
1. Access to special types of informatinon.
2. Access to special types of technology.
3. Access to favorable funding or special types of capital.
4. Access to special types of products or opportunities.
5. Access to special (non-profit driven) counterparties.
These are real edge.
Quote from TheBlackHand:
Thats not an edge.
You're better off sticking your money in an account that pays out 2% or more. It's safer and more rewarding.
IMO, an edge should return more than the risk free rate - otherwise there is no edge as the risk is too much.
no wonder the US is becoming a 3rd rate nation. mathematics is not one of your strong suits.
read!!
"My calculated edge based on actual trades is 1.8% or for every $1000 I put into a trade
ever hear of leverage and turnover."
Quote from TheBlackHand:
An edge is any approach that has a proven statistical positive expectancy whne executed.
What an edge is not is mysterious or rocket science, related to psychology or other some such
Casinos with their organisational set ups have no emotions or psyche involved in their daily operations ,success of manual traders who trade depends on their psyche.
TheBlackHand
Guest
Quote from zdreg:
no wonder the US is becoming a 3rd rate nation. mathematics is not one of your strong suits.
read!!
"My calculated edge based on actual trades is 1.8% or for every $1000 I put into a trade
ever hear of leverage and turnover."
And comprehension is clearly not your strong suit.
In the sentence it is claimed: "over the period of a year Iâm fairly confidant that I will come close to that number. "
'That Number' is therefore implied to be 1.8% as there are no other numbers stated.
However I would agree that the US will become a 3rd rate nation if the population displays such poor assumptions as yours. I'm not American. Therefore both your geography AND comprehension have been found to be wanting.
I do hope you dont make such poor assumptions in the markets!
Be lucky!
TheBlackHand
Guest
Quote from oilfxpro:
Also lacking understanding of risk.
2 % a year is no risk ,when government is creating inflation eating up more than 5 % a year of capital .
Again, another assumption. Inflation may well be 5% is USA, but not elsewhere.
However you are correct in stating that inflation should indeed be considered. For that you should be applauded.
I was simply making a brief point.
It's funny how folk here are unable to define simple but important words like 'edge', yet are perfectly capable of derailing a simple statement with all kinds of detail and nonsense.