Why do you care so much about having an "edge?

Quote from traderdragon2:

You dont need edge.
All you need is prayer.
God will make you money.
Prove im wrong.
Ask Jem. He is right, and the top 1% of scientists in the world are wrong.
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I can't belv I'm responding to this post, must be pretty friggin bored.

Anyway, there are no edges. Either you understand what the market is trying to do or not. If you do and you're willing to risk being wrong you stand a good chance of making $.

Once you understand the market, you need patience. Patience to hold winners and to wait for your "edge".

I'm pro God, but if God was gonna make you money he would do the same for everyone. There's something called free will...we make our own choices...God isn't into minutia. No one is more special in God's view. God's grace is freely given if one chooses to accept it and has nothing to do with what you do or how good you are. You can't save yourself!
 
I don't know anything about the guy, but I bet he didn't walk into Enron and they said "Oh here's 500 million dollars"... he started somewhere, just like us. But he can actually execute his strategy on ridiculous sums of money, he didn't cap out at 100k or breaking even. He pushed and pushed and eventually the amount of money he was risking didn't bother him. Ask yourself how you would feel after a down 10 million dollar day. I bet he had to go through it.

Contrary to what a lot of people have said I think its that indifference to money that I think makes the difference between a normal trader and someone like Arnold.

Trading is a business yes, but its unlike any business that I know of. Yes money is the bottom line, but its the fact that he probably didn't sit around and go "Oh no I have 10 million on this ohhh ahhhh" and pine over and over about it to the point where it affected his judgment probably made him be able to take huge bets and huge losses, and ultimately huge gains.

Money holds a distinct power over all of use and I think maybe releasing ourselves from its grip might be the key to large profits. We must respect it of course, but it is not our master. We control our profits and losses, they don't control us.

Maybe its this indifference regarding money that makes the difference between $100,000 per year and the 4 million dollars per day this guy can make.

Thoughts?
 
One more thing:

Ask yourself this. On Monday take your exact strategy and setup, but instead of trading your usual amount imagine you have $10 million on it. Do you act differently? Does it affect you? Think about it honestly. Does it affect you? If so I submit to you that there is mental work yet to be done which is what this thread is about.

I know it would affect me haha.
 
Quote from jonbig04:




Of course that is an extreme example, but you get the point. I had to disagree with DB when he said that it was simply that most noobie's don't take the time to develop a winning strategy. I'm sure this IS the case a lot of the time, but I'm not talking about Joe Schmoe looking for the holy grail and who thinks about trading for an hour a day, I'm talking about the people who study and study until their faces are blue, or the people who do have a method, but can only manage to bring in 100k per year. Of course he knows much much more than me and I have learned a lot from him, but I can't bring myself to believe that the difference between the average decent trader and John Arnold who's never had a less than +150% on billions is simply hard work (i.e. strategy development). That would be too easy. There are too many people willing to put in the work and time that simply don't achieve the millions that are left on the table each day in futures trading.

So I have to ask myself, what is the difference? I have a hunch, but will save it for later today.
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You don't understand what trading or risk management is about if you are talking about nominal returns. A trader might only be making 100k a year but its a hell of a lot if his risk capital is only 50k or even 100k, a 100-200% annual return isn't a bad result by any measure. Trading is just like any other business, a larger risk capital allows the trader to take on the same amount of risk (eg. 1%) while he makes more money out of that.

Why do so many traders fail? Because they spend too much time on useless psychocrap garbage when they should have been focusing on trading basics like risk management and position sizing. Of course, >90% of them also don't have a winning strategy aka edge.
 
Quote from jonbig04:

Its my opinion, and that of others...a few very successful others that trading is 80% mental and 20% edge...

If that's true than it seems strange that edge and method thread outnumber threads about your trading mentality by so much

that's all I'm saying
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most people are not in sinc with themselves,constantly searching outside to find whats inside,that.s no doubt a part of why most traders fail,but from a floor view,most traders are pretty lost in there personal world,keep in mind that they are suddenly making more than any living relative,which may further distance one from reality,,so the logic tips in favor of the edge and not the personal life
 
Simplicity is the outward sign and symbol of depth of thought.
-Lin Yutang

http://thegrowinglife.com/2008/02/t...een-bruce-lee-a-productivity-guru-and-others/

Always remember this when you get a productivity report: outsourced workers in the Inner Mongolian jugfucker region where a new phone center was opened will increase productivity because the work has been outsoyrced but the benifit to the company is still counted.

Another way to increase productivity by 20% is to fire 1 out of 5 workers and make other 4 work 1/4 harder with no increase in wages.
 
What is an edge? There are no edges. There are only the markets. You either nail them or you don't. That means you master the market and pull dough from it, open to close.

Everyone not winning or not doing more than jacking around with a few profits here and there, needs to get real and stop running away. Stop all the bullshit excuses so often writ large all over ET.

You can take CL - its stuffed full of profit for the daily player to do the sequential thing, using his sharp and quick mind, buying the upswings and selling the downswings as they follow each other, with an efficient methodology in place. A lttle slower but also rich in profits are ES and YM. Same thing though - buying the upswings and selling the downswings.:cool:
 
Dackster

"You know, once you stop dreaming, you may start trading.

It's all right in front of your eyes, try using them."
----------------------------------------------------------------------------------

The problem is that there's nothing so blind as a "no-eyed deer"!

It's virtually impossible to find an edge that a retail trader can exploit in the long term, a little thought should give you many reasons why. That being said, it's relatively easy to develop a positive expectancy technique to be successfully exploited. KISS is the passport that will allow you to go where you choose. Initially we all ,due to ignorance, try to beat the markets with our self perceived brilliance, after all isn't that why we're here,because we're smarter than the average bear or so we think! We devour books,videos,lectures, blog posts and the list goes on ad nausium. For most would be traders no effort is too great. The only thing great about it is that it's " a great waste of valuable time and effort". Once you have learned and fully understood the intracacies of the various instraments [futures,options,currency,interest rates etc] and how they interact,you will have the technical knowledge required, after that 99.9% of what you read , view or hear will not only be absolutely useless but will probably thwart you in your quest to become a successfull trader. Having achieved technical profficiency you then need to open an account and get live data feed [not touting but I use IBs' TWS Professional this gives me all the resources that I require] broadly speaking you will require the equivalent. Now, sit down and watch/take notes and watch and watch employing creative thinking whilst evaluating the interactions for however long it takes[3months/6months/12months] to develop a positive expectancy strategy. Once you construct your positive expectancy strategy,then and only then start to trade. Remember always KISS, over time I found commercial TA to be less efficient/successful than simple and easy proprietry exel spreadsheet indicators that I developed. Less than 5 minutes a day gives me all the directional information I require, obviously it requires more time to nut out the appropriate responses to market/price action. As suits my personality I don't watch the markets tick by tick, all of us are different and need to think long and hard about exactly what style will suit us and then trade accordingly.
Not meaning to insult anybody but the vast majority of posts here and on other trading sites are pure unadulterated crap, although if you search intelligently there are some absolute gems to be found and it certainly pays to take the time to learn where to look. One poster that comes to mind is Maverick, but there are certainly many others.
You've now been given an "eye-deer" it's given freely so do with it as you choose, I wish you well in your trading.
Regards
Johno
 
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