Why trend trading does not work?

[EPrado]

Quote from bone:

Complete brilliance. Well said, sir.

Thanks man.

Been trading long enough to have seen a lot of strategies. Outside of my time at Refco in Chicago and seeing their insane approach to trading, with the right risk mgmt/discipline, they all do work.

Personally, I trade with the trend and don't fade. But have nothing against the faders/mean reversion guys. If it works for them go for it.

 

[trade4ever2day]

Quote from EPrado:

Personally, I trade with the trend and don't fade.

This is the only way to make money IMO.

 

[bone]

Quote from EPrado:

with the right risk mgmt/discipline, they all do work.

Personally, I trade with the trend and don't fade. But have nothing against the faders/mean reversion guys. If it works for them go for it.

Yep, and this is where the cliche and platitude kicks in: If you can engineer your strategy into something consistent and repeatable, then the worm will turn for you. Some traders have it within their core DNA to fight the market, others would rather be on the same side as what they percieve to be the dominant trend. In the end, the bottom line is indeed the bottom line.

Having said all that, I have taken on several clients who spent their entire careers fighting the market and they made a living at it. In the end, they ultimately felt that it was exhausting from an emotional aspect, and that they often felt that they were not using their resources in terms of capital and emotional energy using some other more "trend compliant" strategy.

 

[EPrado]

Quote from alexandermerwe:

This is the only way to make money IMO.

I think it's the best way to make money. But I do know guys who fade looking for a quick snap back in the market. But....they are the most disciplined traders I know. You have to be with that strategy.

For me, the trades where I make all of my money are the ones that I get filled on, and are pretty much profitable right away. The ones where I get filled and they instantly go against me without showing any signs of going my way...those are no good.

Trading with the trend puts me in the first situation a hell of a lot more than fading would.

 

[EPrado]

Quote from bone:

Yep, and this is where the cliche and platitude kicks in: If you can engineer your strategy into something consistent and repeatable, then the worm will turn for you. Some traders have it within their core DNA to fight the market, others would rather be on the same side as what they percieve to be the dominant trend. In the end, the bottom line is indeed the bottom line.

Having said all that, I have taken on several clients who spent their entire careers fighting the market and they made a living at it. In the end, they ultimately felt that it was exhausting from an emotional aspect, and that they often felt that they were not using their resources in terms of capital and emotional energy using some other more "trend compliant" strategy.

"If you can engineer your strategy into something consistent and repeatable, then the worm will turn for you"

EXACTLY.



I have buddies who fade every move. It's like an illness. It seems to me they would rather lose 100k fading a move then losing 10k buying a top/selling a bottom.

And they do it every day....have been for years.

 

[bone]

Quote from EPrado:

I have buddies who fade every move. It's like an illness. It seems to me they would rather lose 100k fading a move then losing 10k buying a top/selling a bottom.

And they do it every day....have been for years.

Yep, and they are without exception the bitchiest guys in the room. Hard drinking and bitter. Pure joy to be around. The ones you steer your wife away from during the firm's annual holiday party when it comes time to find seating for dinner.

 

[EPrado]

Quote from bone:

Yep, and they are without exception the bitchiest guys in the room. Hard drinking and bitter. Pure joy to be around. The ones you steer your wife away from during the firm's annual holiday party when it comes time to find seating for dinner.

LOL.....I think you and I traded at the same firm/went to the same parties. Too funny. Very true.

They are the ones who also bitch they lost money because of bad fills, the High Frequency guys screwed them, the robots screwed them, the algos screwed them, maria baritotromo screwed them, Bernanke screwed them, the guy who took the reading for the ISM report screwed them......

it gets old.

 

[marketsurfer]

Quote from EPrado:

"If you can engineer your strategy into something consistent and repeatable, then the worm will turn for you"

EXACTLY.



I have buddies who fade every move. It's like an illness. It seems to me they would rather lose 100k fading a move then losing 10k buying a top/selling a bottom.

And they do it every day....have been for years.

They must be making some money to survive that long!

right?

 

[tradingjournals]

Quote from marketsurfer:

They must be making some money to survive that long!

right?

You caught it! I waiting to see if someone here on ET would catch it.

There is at least one other guy who repeats it a large number of times. It seems that the incoherence in the incoherence have not been realized yet.

There are things that cannot be hidden.:

 

[stock777]

Everyone on et knows how to trade, and most are better than the best.

Todays up down down up up up down down up up down up up up down up trend is classic and my favorite.