Will a Technical Pattern ever stop working/appearing?

[eurusdzn]

Thanks for the discussion everyone.

Very interesting insight from everyone.

Thank you.

In conclusion, never share your strategy!!

Is it possile over time that beautiful , young, curvacious women will not have as much effect on men that they used to have?

I dont expect that anyone will offer to share their significant others to satisfy an anonomous' needs or curiosity. But , maybe so before their strategies.

 

[lawrence-lugar]

Will patterns people use for a number of years suddenly stop working

Solid sound advice and strategy stands the test of time. until, of course, you are dealt a Joker card in the market...which happens from time-to-time.

That's the beauty of the market...it's part science, part art. -- you can only teach or learn so much...but the next step to being the chosen one...remains to be seen.

 

[Speculate]

Yes, that is so.

We're not talking about money mgt (MM) in finance, we're talking about MM in the context of trading. The phrase comes from the world of professional gambling (specifically, blackjack card counting), where the phrase "money management" absolutely and unambiguously means bet sizing.

Feel free to focus on Risk Management if the way I used MM gives you the heebie jeebies. But try to not have a cow if you see the way I used "money management" also used by others elsewhere. Unlike you, it isn't new to this community.

lol.

Thanks - I'll look that up (re poker). Position sizing is surely risk management. If I double my size, I'm doubling my risk surely? I guess its semantics again so not really worth a discussion.

 

[kut2k2]

lol.

Thanks - I'll look that up (re poker). Position sizing is surely risk management. If I double my size, I'm doubling my risk surely? I guess its semantics again so not really worth a discussion.

Not just semantics. Why look at risk without also looking at reward? Starting at a position size of zero (percent of your trading acct), your risk is also zero. As you gradually increase your position size, yes your risk increases. But so does your reward, assuming your timing strategy actually provides an edge. At a certain position size, your reward reaches a maximum. This is your ideal position size. Increasing position size beyond this point just increases your risk while decreasing your reward. So don't go beyond the ideal position size. I've written scads on position sizing, look up my Kelly threads.

 

[iamnewuser911]

Not just semantics. Why look at risk without also looking at reward? Starting at a position size of zero (percent of your trading acct), your risk is also zero. As you gradually increase your position size, yes your risk increases. But so does your reward, assuming your timing strategy actually provides an edge. At a certain position size, your reward reaches a maximum. This is your ideal position size. Increasing position size beyond this point just increases your risk while decreasing your reward. So don't go beyond the ideal position size. I've written scads on position sizing, look up my Kelly threads.

Can you link the thread you've written?

 

[kut2k2]

Can you link the thread you've written?

Threads. Here's the latest:

http://www.elitetrader.com/et/index.php?threads/a-new-kelly-formula.291307/

And if you need background on the Kelly fraction, look up the "Kelly for traders" thread. Time for you to get comfortable with the search pages, young'un.

 

[qxr1011]

Will patterns people use for a number of years suddenly stop working or stop appearing?

assuming trader is a trader and everything is okey with his balls

stop working - yes

stop appearing - no

why is it possible for them stop working ?

because usually patterns in the particular time periods appearing not in a vacuum, but while there are other patterns in the same on different time-periods ...

so "working" or not will depend of how this overlap between patterns will occur in the future
and it is possible that what was "working" in the past often was just favorable overlap,and will not work today, but may work tomorrow

here is when the trader and his capabilities and vision comes-in .. he is the one who suppose to see whats going on not only on the smaller but on the bigger pictures as well , and adjust his approach accordingly

that's why algorithm will never will trade better than trader....

that's why all those morons talking about historical ten percent profit and salivate about it...

they do not know what dynamic trading is about... they do not have vision, flexibility, they paralyzed by their own rules and expectations,...

and limitations of their their algorithms is just an extension of their inability to roll with the situation

 

[wrbtrader]

I strongly disagree.

Anything that you need to do that's involved in the process of trading and has an impact on your trading results...its part of your trading plan. If you don't need it to trade or it has no impact on your trading results...its not part of a trading plan.

Its as simple as that.

As for risk management...lots of stuff falls under that umbrella including position size. Yet, unfortunately most don't use risk management and therefore position size, capitalization, proper margin use and so on is off their radar.

In fact, many time I have times seen so called "veteran traders" here at ET call position size as not important in one's trading plan or they disagree strongly that it has not impact on one's trading results.

That too I strongly disagree with.