What is your edge ?

Quote from sle:

I am not sure that's a real word :)


Yep. Edge is something built into your investment process that allows you to have an upper hand on competition. It could be technological, like that for HFTs, it could be access or transactional, like it is for market makers or it could simply be built into the decision-making process.

According to my first boss, it's clever twistedness and constant depression that make me a good trader. My edge, however, is in muli-faceted quantitative analysis of various risk premiums in the market.
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Damn Iphone!

It's all semantics, but while I think your strategy is very unique and there aren't many people who can do it. I wouldn't consider that an edge.

You said something on here a while ago about how even without edge, we are just competing for alpha. I believe you can successfully compete for alpha without having an edge (by just being better). But an edge makes life a lot easier.
A corporate derivatives book has REAL edge. HF exotics? Probably not as much and you can still make money.
My view on the world...
 
Quote from newwurldmn:

No. Being profitable is not sign of an edge. Being a desretipnsry trader is not an edge. There are millions of them.

Edge is something very few people have and it is clearly defined. Lack of edge doesn't mean you can't be profitable. You can be a good athlete without taking steroids but taking steroids would clearly be an edge.
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So if a clean Anderson Silva demolishes a juiced Chael Sonnen in their rematch, Silva does not have an edge? He's just the superior athelete? 2-0 against a man with several times the normal male testosterone level?

Then I'd definitely want to be the superior athlete. Talk about a robust strategy - "be the champion". No need for gimmicky tricks and well defined, secret technologies. Just raw superiority.

That's right - raw superiority. What do you think, edge boyz? How does it feel to know that you don't have anything on skilled discretionary traders, who have no edge?

The are just superior traders with superior thoughts and psychological control.

Talk about an advantage........
 
Quote from newwurldmn:
You said something on here a while ago about how even without edge, we are just competing for alpha. I believe you can successfully compete for alpha without having an edge (by just being better). But an edge makes life a lot easier.
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I just thought about it, you might be right. An edge has to be something that provides positive expectation to the trades at time zero, be it bid-offer, knowledge of upcoming flows or understanding of some hidden features of the product (e.g. guys trading LIBOR in arrears swaps X years ago had an edge by definition).

Quote from Wide Tailz:
So if a clean Anderson Silva demolishes a juiced Chael Sonnen in their rematch, Silva does not have an edge? He's just the superior athelete? 2-0 against a man with several times the normal male testosterone level?
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Genetic qualities, such as as height, weight, smaller brain size (must be important for fighting arts) are an edge by itself. Though, these days, that edge might not be enough.
 
Quote from sle:

I just thought about it, you might be right. An edge has to be something that provides positive expectation to the trades at time zero, be it bid-offer, knowledge of upcoming flows or understanding of some hidden features of the product (e.g. guys trading LIBOR in arrears swaps X years ago had an edge by definition).


Genetic qualities, such as as height, weight, smaller brain size (must be important for fighting arts) are an edge by itself. Though, these days, that edge might not be enough.
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The best edges I have found:
1. Low financing costs (real money there), but really a bank thing
2. Trading with non-profit motivated counterparties. And you see this even in equity markets.
3. Ability to not have to trade (really a retail benefit).
 
Quote from FreakofNature:

You mean dollar cost averaging with the trend?
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Mean reversion with the trend works good but buying panic bottoms also works. Even 2008 panic bottom bounced eventually, just average in. Go from 1-2 to 1-100 leverage.
 
The most important factor to trader profitability is the mindset , those traders who have the correct mindset have the edge over others who fail.This is the most important edge for manual traders , if it is combined with a profitable method.
 
Quote from oilfxpro:

The most important factor to trader profitability is the mindset , those traders who have the correct mindset have the edge over others who fail.This is the most important edge for manual traders , if it is combined with a profitable method.
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Provided of course if it's not "day trading"...right olix...according to your thesis?
 
Silva's edge is being trained by Steven Seagal.

http://www.youtube.com/watch?v=ri5J8-w2RIE

Quote from Wide Tailz:

So if a clean Anderson Silva demolishes a juiced Chael Sonnen in their rematch, Silva does not have an edge? He's just the superior athelete? 2-0 against a man with several times the normal male testosterone level?

Then I'd definitely want to be the superior athlete. Talk about a robust strategy - "be the champion". No need for gimmicky tricks and well defined, secret technologies. Just raw superiority.

That's right - raw superiority. What do you think, edge boyz? How does it feel to know that you don't have anything on skilled discretionary traders, who have no edge?

The are just superior traders with superior thoughts and psychological control.

Talk about an advantage........
More...
 
Quote from riffrafffpatrol:

Provided of course if it's not "day trading"...right olix...according to your thesis?
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Day trading requires a different mindset , a mind set that changes like the wind and noise , and that is hard. Trading during the day is done , not only by day traders but a lot of strategic traders and financial institutions , but these other traders have specific mindsets.

http://www.elitetrader.com/vb/showthread.php?threadid=218977
 
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