Why market wizards are not day traders?

I recommend to those here not entirely in disagreement with me that they check out this article, about 'superior people'...
https://mgpiety.org/2015/06/14/on-greatness/

people who imagine that geniuses don't brag about it have apparently not met a lot of geniuses

of course most geniuses are so far up themselves they just don't talk to the 'mediocre people' - hence the confusion

rare is genius that is also sociable; insane to label that sociability as 'superiority' complex; if i had a superiority complex, would i come here and treat you as equals who can contribute to whatever i am analysing.

never mind.

"Out of curiosity: how do you know that you are one of the best mathematicians in the english speaking world?"

well, because the people in china and perhaps also russia and definitely iran have a much higher average IQ than those in the west, so i guess i'm fairly sure. but you may be right. maybe i'm one of the best mathematicians in the world. nonetheless there is insufficient data for me to make a guess on that either way. with the west there is my academic record, the time i've spent with all your so-called geniuses and the general performance level difference between me and the average trader, me and the average web developer, me and the average salesman, amongst other things. performance stats.

put it like this - i know that the same way a trader who studies fundamentals knows whether a company seems overvalued or undervalued

anyway. never mind. i reckon i'm fairly sure that if i were to day trade i'd be lowering myself in the name of short-termism and a desire to solve my problems quickly, with money, rather than in their own time. the stress in life i have to contend with is enough as it is - being a day trader would not solve it because it would double the stress, regardless of what profit comes out of it.

think about this - those who are malevolent towards me here - MPs and governments have increasingly been influenced by my arguments and activism, the incumbent british government is now having its policy dictated by an opposition which sometimes precisely follows the kind of advice i and many like me are putting forward

when corbyn is in power he will use opinions like mine to decide whether to work to outlaw day trading one way or another

you have had an opportunity to tell me any reason why i shouldn't encourage him to do that

some here have used the opportunity wisely

others less so!

money isn't everything, you know. well no, some of you don't.
 
themickey said:
Hobomatebloke, would you have an example of your trading maths you talk about?
More...

An example of my so-called 'zero sum rupturing' technique is the one I gave, where instead of closing you wait a little longer and lock in, assuming most of the locked in profits will just be taken right there, practically, whilst the extras add up, more and more over time

On my site at the link on my profile the same approach is shown on a much more slow and easy structure, where you just buy a share after some degree of fall and eventually lock in the price when it's at 120% of its starting price.

As for other examples... ie of where I've learned to use things like technical signals, eg ema crossovers, or just trends, I mean that's obvious - we all know what I'm talking about there and those aspects of the trades are as easy for us all. What I'm saying is that it is now my theory that to go from technical triggers which don't really guarantee a profit to technical triggers which do, one needs but to use the locking-in method - which may seem banal but turns out to be the key to seriously ensuring success.

I'm sorry if I'm unclear. What specifically do you want an example of?

The triggers I've learned to use over time vary - ema crossovers I like or at least the trend based on looking at two emas.

The forex thing I mentioned I'll tell you about. I tested 1000s of hours across 5 forex crosses, where at the start of the hour immediately after an ema crossover has completed at the end of the hour before I set it to trade with a 4 pip stop and a 2 pip limit and across the 5 forex crosses, over about 10,000 hours, there was never a point, after the opening, where it wasn't moving upwards overall, regardless of what individual crosses out of the 5 were doing. this was the main usd crosses and a couple of eur crosses. I found that to be one of the most interesting discoveries in my backtests.

But the only thing I know I can rely on, other than the brute force of day trading, which I'm now absolutely sure I won't be doing, is my '15 minutes a year' malarkey at the link on my profile. It's pretty bloody simplistic and in many ways 'weak' - and yet it has serious potential. What's striking is that it treats prices and movements as largely meaningless data. Then again, maybe that's the best way. One day maybe I'll even know the answer to that.

I have of course tried 100s of things, over the years, which categorically failed!! LOADS of those ones.

I know that looking at fundamentals and finding value stocks is the way one is supposed to trade and that technical trading on its own is just silly, or only works when coupled with brute force. But I have been trying to learn everything possible. I know that event-driven trading is the only 'real' type of trading most of those big names believe in. I also don't, personally, believe that's really true. I think that all these types of trades get wiped out by 'fat tails' sooner or later and that pure mathematical approaches involving manipulating probability are the only way you make a George Soros.

As something which may interest you, I refer you to an explanation I have watched Feynman (in a video) give concerning the nature of the reflection of photons of light from the surface of a mirror. Feynman explains, and demonstrates some amazing maths, that if you strip away bits of the mirror at precise points you amplify the reflection. Why this happens is not what I shall explain here, only that it happens. I won't go into how but it's worth watching that Feynman lecture if you can. What matters is that when it comes to trading your object is to strip away parts of the price's history/chart, strip away bits where you should or shouldn't trade, magnifying the amplitude of the outcome in a positive way, ie adding to the outcome, thus ensuring that you maximise the chances of a net profit end result.

But again, that main 'day trading' method I have found seems to work for me, although I hate it and have quit anyway, goes like this - 10am I see what the direction of eur/usd was at 9am to 10am, then I trade. If it moves up more than 6 pips the right way by the end of the hour I move the stop from -10 pips to +2 pips, then I wait till the end of each hour and lock in price-10 pips any time it is possible. if a trade closes whether through loss or taking the locked in profit i trade at the start of the next hour based on the hour before that next hour, ie a closed trade = reset and start again. the last trade i place is at 6pm. i carry on moving stops once per hour until 11pm and if anything lingers overnight carry on moving the stop at 8am onwards.

it's amazingly frustrating but because of the various very big wins it seems to work out. maybe i'm wrong. i dunno. i have no means to extensively backtest it except by hand. and i cannot be arsed with that right now. anyway. that's most of the best stuff i have for you. between the 15 minute thing, my finding with those forex crosses and the locking-in profit method outlined above and in other places, there's not a huge amount more in my 'repertoire' such as it is, i'm afraid. i never really got into event-driven trading, i did start to investigate it and later in life i suspect i may finish the job of learning that.

i sincerely hope there is something of interest or even use to you in that!

cheers.

have a good one



___

additional info - as usual one leaves out too many details in swiftly narrating it

those ema crossovers were 10 and 25, on the hourly chart
 
Last edited:
hobothedestroyer said:
An example of my so-called 'zero sum rupturing' technique is the one I gave, where instead of closing you wait a little longer and lock in, assuming most of the locked in profits will just be taken right there, practically, whilst the extras add up, more and more over time

On my site at the link on my profile the same approach is shown on a much more slow and easy structure, where you just buy a share after some degree of fall and eventually lock in the price when it's at 120% of its starting price.

As for other examples... ie of where I've learned to use things like technical signals, eg ema crossovers, or just trends, I mean that's obvious - we all know what I'm talking about there and those aspects of the trades are as easy for us all. What I'm saying is that it is now my theory that to go from technical triggers which don't really guarantee a profit to technical triggers which do, one needs but to use the locking-in method - which may seem banal but turns out to be the key to seriously ensuring success.

I'm sorry if I'm unclear. What specifically do you want an example of?

The triggers I've learned to use over time vary - ema crossovers I like or at least the trend based on looking at two emas.

The forex thing I mentioned I'll tell you about. I tested 1000s of hours across 5 forex crosses, where at the start of the hour immediately after an ema crossover has completed at the end of the hour before I set it to trade with a 4 pip stop and a 2 pip limit and across the 5 forex crosses, over about 10,000 hours, there was never a point, after the opening, where it wasn't moving upwards overall, regardless of what individual crosses out of the 5 were doing. this was the main usd crosses and a couple of eur crosses. I found that to be one of the most interesting discoveries in my backtests.

But the only thing I know I can rely on, other than the brute force of day trading, which I'm now absolutely sure I won't be doing, is my '15 minutes a year' malarkey at the link on my profile. It's pretty bloody simplistic and in many ways 'weak' - and yet it has serious potential. What's striking is that it treats prices and movements as largely meaningless data. Then again, maybe that's the best way. One day maybe I'll even know the answer to that.

I have of course tried 100s of things, over the years, which categorically failed!! LOADS of those ones.

I know that looking at fundamentals and finding value stocks is the way one is supposed to trade and that technical trading on its own is just silly, or only works when coupled with brute force. But I have been trying to learn everything possible. I know that event-driven trading is the only 'real' type of trading most of those big names believe in. I also don't, personally, believe that's really true. I think that all these types of trades get wiped out by 'fat tails' sooner or later and that pure mathematical approaches involving manipulating probability are the only way you make a George Soros.

As something which may interest you, I refer you to an explanation I have watched Feynman (in a video) give concerning the nature of the reflection of photons of light from the surface of a mirror. Feynman explains, and demonstrates some amazing maths, that if you strip away bits of the mirror at precise points you amplify the reflection. Why this happens is not what I shall explain here, only that it happens. I won't go into how but it's worth watching that Feynman lecture if you can. What matters is that when it comes to trading your object is to strip away parts of the price's history/chart, strip away bits where you should or shouldn't trade, magnifying the amplitude of the outcome in a positive way, ie adding to the outcome, thus ensuring that you maximise the chances of a net profit end result.

But again, that main 'day trading' method I have found seems to work for me, although I hate it and have quit anyway, goes like this - 10am I see what the direction of eur/usd was at 9am to 10am, then I trade. If it moves up more than 6 pips the right way by the end of the hour I move the stop from -10 pips to +2 pips, then I wait till the end of each hour and lock in price-10 pips any time it is possible. if a trade closes whether through loss or taking the locked in profit i trade at the start of the next hour based on the hour before that next hour, ie a closed trade = reset and start again. the last trade i place is at 6pm. i carry on moving stops once per hour until 11pm and if anything lingers overnight carry on moving the stop at 8am onwards.

it's amazingly frustrating but because of the various very big wins it seems to work out. maybe i'm wrong. i dunno. i have no means to extensively backtest it except by hand. and i cannot be arsed with that right now. anyway. that's most of the best stuff i have for you. between the 15 minute thing, my finding with those forex crosses and the locking-in profit method outlined above and in other places, there's not a huge amount more in my 'repertoire' such as it is, i'm afraid. i never really got into event-driven trading, i did start to investigate it and later in life i suspect i may finish the job of learning that.

i sincerely hope there is something of interest or even use to you in that!

cheers.

have a good one

___

additional info - as usual one leaves out too many details in swiftly narrating it

those ema crossovers were 10 and 25, on the hourly chart
More...
Thanks for the lengthy reply.
Not any meat in that which I can see.
You mentioned you hate wasting your time trading but supplied info like trading crossovers and day trading examples.
Trading crossovers imo is not a very profitable method, both entries and exits are too late often, however there is some worth there, not altogether rubbish, but it only applies to special situations, eg, it works sometimes and fails often if not used in the correct contexts, cannot be used carte blanche.
Fx and futures trading are both time consuming, long term trading is relaxing if you know what you are doing.
The secret to long term trading is knowing WHAT to trade/invest in.
This is where the maths comes in handy, not so much the buy sell signals, but the maths which filters out the rubbish and selects the best picks, this results in high probabilities, low risk.
 
themickey said:
Thanks for the lengthy reply.
Not any meat in that which I can see.
You mentioned you hate wasting your time trading but supplied info like trading crossovers and day trading examples.
Trading crossovers imo is not a very profitable method, both entries and exits are too late often, however there is some worth there, not altogether rubbish, but it only applies to special situations, eg, it works sometimes and fails often if not used in the correct contexts, cannot be used carte blanche.
Fx and futures trading are both time consuming, long term trading is relaxing if you know what you are doing.
The secret to long term trading is knowing WHAT to trade/invest in.
This is where the maths comes in handy, not so much the buy sell signals, but the maths which filters out the rubbish and selects the best picks.
More...

I appreciate what you say about the best picks, and I'm sure you're right, I realised it ages ago but as Shiller points out right now there aren't many good picks at all anyway. If I were trading that way I'd be keeping out of the market far more than getting into it.

I tried to learn day trading to escape from short term total poverty, since it is the only way to bootstrap a small load of cash quickly, blatantly; I learned to enjoy poverty instead. for now. day trading is just masochism and if I wanted that I'd get a job.

You're right, and the only way to longterm trade the way the mainstream giants do is as you say, I am sure I understand that now. But I was always a mathematical outlier, a completely feynman-like mathematician.

People like Buffet may well buy and hold, for very long periods, and I get how much that approach makes. But in the middle there is the idea of buying and holding only briefly, which is just as legit.

So my basic method is just something like that which instead of caring about any specific company accepts a few key a prioris:

- almost all companies will do everything they can to not disappear, to always strive for an upward share price in the longterm, regardless of the short term
- a pool of 100s of companies, diversely picked, has certain traits you can predict

Sure much more money can be made the way you say I should learn AND I WILL (I need time, and money) but the way I've figured out so far is fine. It works, which is all that really matters. But of course one has to be properly hedged, not just pooled.

I have begun learning to use the fundamentals research tools at my disposal, not just the silly technical ones.

Anyway, cheers. FYI my interactions here have been extremely useful vis a vis the maths of one of my methods, and my day trading. I think I have confirmed that the way day trading really works IS by 'brute force' (ie thugging out sitting there opening and closing trades and feeling no frustration, using your self as the thing for always locking in profit, not any 'good choice' - not any maths). And that has (a) enabled me to see that the method I definitely don't want to do does work, though, which I did want to know and finally learn, (b) shown me why another of my methods I was unsure about really does work and is amazing, and far far better than anything else - but that's just something else far too long to talk about so I won't mention that at all beyond what i've said. however, the premise i was unsure about but am now sure about is that day traders are mostly making winnings out of toughing it out, not out of brilliant analysis.

I think I'd like to learn about theoretical physics much more than about trading with 'fundamentals' - so I probably won't really end up learning any more about trading than I have at this moment in time. I think that I may be able to come up with discoveries in the field of physics which may help mankind. Certainly I think it's worth my trying. But I am sure I want to create activistic hedge funds, so people working for me sure will learn all that stuff, you can count on it. I have enjoyed the trading maths I've been hammering away at all these years, failures and successes alike - I never really cared about the money, only the discovery.

Glad to share any scraps I can with you all. Many of you, regardless of background, pursuing the same discoveries as me. But soon I think it's time for me to begin to move on to the thing which interests me most, the road to and through Quantum Physics.
 
trading crossovers IS shit. yes. totally. at best you end up with a zero sum. that's what i reckon. BUT my 'zero sum rupturer' magnifies profit in a zero sum hugely. that is what the maths seems to say. eg...


normal set of trades...

win 2
win 2
lose 4
win 2
lose 4
win 2
lose 4
win 2
lose 4
win 2
win 2
win 2

net = 0

if you lock in (by hand) the profit when price hits 3, rather than collecting automatically at 2...
(including one win 2 dropped, as though the price peaked at 2.5 and reversed)

win 2
lose 4
lose 4
win 4
lose 4
win 2
lose 4
win 4
lose 4
win 3
win 2
win 5

net = 2 profit

and if you extend it over time you will get more and more 5s and above, which draw the average higher... all of it is on top of the zero sum. so in a way that's really the only part of the profit you should count as really (longterm) profit.


i think that's a good pretend-example of what i'm trying to explain, why if you take a set of trades which would usually yield something like a zero sum or a very low profit and instead of closing them when they would have closed you let them run a little bit on and move the stop and then don't touch the stop until it's had time to move a reasonable amount more, maybe waiting a whole 10 points, or maybe moving it up every few points... one could experiment and see what's best

the point is that if it would have had a zero sum with the trades closing at their limits then if you let it run on, losing hardly any in that little distance, and then lock in the planned limit, you get a whole load of extra gain, which i have labelled 'bias', ie with reference to the zero sum

i've tested it over and over and over again on many real and virtual platforms in many contexts

it has not failed anywhere, in any context - it is basically the reality. it is a good way to trade. a good 'edge' to have.

it's a strange structural difference which seems to be able to change the game for anyone stuck with low profits or losses from sequences of trades where the losses always manage to claw back the wins or most of them or even a little more

anyway. i applied the maths of those examples to slow trades, over months, and eventually to day trading itself. that is what i have been trying to do. as for the fundamentals... when i hire someone i'll hire someone for whom that's a step up intellectually and a worthwhile way to improve themselves. me, i need to go and learn physics now.

i hope i have managed to make visual and clearer what my crazy 'zero sum rupturing' talk is about now. as for everything else... at least in public i have nothing to add to what you guys know. you know far more than me about those things. but all one needs to know is how to effectively guarantee profit. as far as i can see, as long as i'm properly hedged, i can do that.

to me the stock market, ever since i was a tiny boy, is a game, with numbers, where all you really do is play the numbers. i'm not blind to the reality of what other aspects people use to trade - but i'm some sort of fucked up mathmo, really, and i see the world in a funny way. as for the stock market, i'd like to use it to just take money, not really caring much about what the hell it's for or does or what any of it means.

i remember in an electronics exam once i had to fill out tonnes of truth tables and i hadn't paid attention or learned them or anything. i got them all right of course. entirely 'intuitively' - i just looked at them and wrote out what was just 'obvious' to me. it's hard to articulate past that.

so for me trading is a whole different world of fun to those for whom it is like doing a times crossword. doing it your way actually drives me mad, makes me suffer, i hate it. doing it my way is the way which i find funky and which just seems to make profit roll. and at the moment it has been rolling well. so cheers again for all your help. i shall get back to my roads now. hopefully thanks to my chat here i have removed all but the last few minutes of work per year from my existence (using something a little more than that which i've shown on my public profile!).

thanks again, all. and good luck against the rise of corbyn. my advice: respect the state and it WILL respect you. we need banks. we need traders. i agree with that. and i vote corbyn. so don't worry too much if neoliberalism collapses and a new economic order emerges and things like the blockchain and bitcoin alter the entire global economic and financial order! work with it. if you are honest, hard working and clever you can do the SAME job and make shit loads of money even then. corbyn will not deny that. take a close look at the things he says if you don't believe me - i notice few people bother to do that!

anyway. cheers. keep on trucking, siblings.
 
maybe that locking-in profit thing seems obvious to some, maybe you always did it, well done. you must be the minority. for me it makes the difference, in some instances, between profit and no profit. and one needs as many ways to make definite gains as possible. that's a fact. cheers.

hobo out.
 
mickey, I find this video quite educational and useful - it taught me a lot:

it doesn't matter what you trade, it matters how much risk you take (or don't take).

as max keiser says (roughly): there is only volatility in the unhedged market
 
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