Why do they do it?

This is a discussion on Why do they do it? within the General Trading Chat forums, part of the T2W Archive category; Originally Posted by the hare Think about kurtosis in the distribution of returns and you'll understand exactly why he says ...

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Old Jan 28, 2011, 9:46am   #176
 
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Re: Why do they do it?

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Originally Posted by the hare View Post
Think about kurtosis in the distribution of returns and you'll understand exactly why he says this.
I'm looking at an account statement that disagrees.
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I cannot see., however why we should expect to find a "system" which will work in the stock market; surely the possibilities of profits for the student justify the time and effort required to learn market interpretation.

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Old Jan 28, 2011, 10:27am   #177
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Re: Why do they do it?

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Originally Posted by DionysusToast View Post
I'm looking at an account statement that disagrees.
Yes, as I used to tell Mr Socco, there's more than one way of skinning a cat
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Old Feb 3, 2011, 1:08pm   #178
 
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Re: Why do they do it?

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Originally Posted by bedsit View Post
The followers already parted with their money (not much, but never than less every little helps the vendor) and they are following the system which is not making money. Now they are having thoughts along these lines: it's been bad for 2 months only - give it some more time to get realistic idea etc.

What can one conclude from this experience? First thought that comes to my mind is the vendor is good at using people's greed and maybe not that good at trading.
Hi Bedsit,

I was just reading your recent post. Please let it be clear that I am in no way sticking up for the vendor here - I am appalled by some of the things I am reading on the Paul Chalmers thread.

However, I don't think the fault is in the newbies for thinking "It's been bad for 2 months, better give it some more time..."

Just because results have been bad for 2 months does not mean they will continue to be.

In my opinion, it depends somewhat on the strategy that is being implemented and any vendor should be upfront from the start (especially if they are a signal service) of what to expect in terms of results.

If you take my own results as an example. I ran a model account - this was live money but traded at high risk in a proprietary way in order to show how to grow an account. (I have a particular way of doing this but I won't go into it now.)

The point I am making is if you look at the distribution of my results below, if a new person joined in July and dropped 14% and then saw I wasn't trading in August, you think they would stick around? Or say they join in November, drop 17% and then only recoup a mere 2% in December...same story. Your name will be all over the next thread as a scammer.


Distribution of results:

July 2009: -14.42%
August 2009: No Trading
September 2009: +208.06%
October 2009: +57.53%
November 2009: -17.11%
December 2009: +1.92%
January 2010: +18.67%
February 2010: +68.99%
March 2010: -25.71%
April 2010: +88.12%
May 2010: -31.49%
June 2010: +23.35%
July 2010: +64.81%

Total: + 980.97%

Any profitable swing trader will be able to tell you that trading is about execution: You ride out the time when the market is not conducive to your approach and try to keep losses to a minimum and that is all to pave the way for hitting it hard when the market is good for your particular approach to it.

The net result is almost a 1,000% profit after 12 months trading but it doesn't come in the even distribution that all the newbies love. i.e. The "I make one hundred pips each and every single day I trade..." spiel that the internet marketers love to write.
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Last edited by trader_dante; Feb 3, 2011 at 1:16pm.
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Old Feb 3, 2011, 1:12pm   #179
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Re: Why do they do it?

Quote:
Originally Posted by trader_dante View Post
Hi Bedsit,

I was just reading your recent post. Please let it be clear that I am in no way sticking up for the vendor here - I am appalled by some of the things I am reading on the Paul Chalmers thread.

However, I don't think the fault is in the newbies for thinking "It's been bad for 2 months, better give it some more time..."

Just because results have been bad for 2 months does not mean they will continue to be.

In my opinion, it depends somewhaton the strategy that is being implemented and any vendor should be upfront from the start (especially if they are a signal service) of what to expect in terms of results.

If you take my own results as an example. I ran a model account - this was live money but traded at high risk in a proprietary way in order to show how to grow an account. (I have a particular way of doing this but I won't go into it now.)

The point I am making is if you look at the distribution of my results below, if a new person joined in July and dropped 14% and then saw I wasn't trading in August, you think they would stick around? Or say they join in November, drop 17% and then only recoup a mere 2% in December...same story. Your name will be all over the next thread as a scammer.


Distribution of results:

July 2009: -14.42%
August 2009: No Trading
September 2009: +208.06%
October 2009: +57.53%
November 2009: -17.11%
December 2009: +1.92%
January 2010: +18.67%
February 2010: +68.99%
March 2010: -25.71%
April 2010: +88.12%
May 2010: -31.49%
June 2010: +23.35%
July 2010: +64.81%

Total: + 980.97%


Any swing trader will be able to tell you that you ride out the down time and clean up when the market is good.

The net result is almost a 1,000% profit after 12 months trading but it doesn't come in the even distribution that all the newbies love. i.e. I make one million pips each and every single day I trade...
err...OOI how do you get 980 from that?
eg If you go down 20% one month, it takes much more of an increase than 20% to get the money back the next month.
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Old Feb 3, 2011, 1:15pm   #180
 
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Re: Why do they do it?

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Originally Posted by SanMiguel View Post
err...OOI how do you get 980 from that?
eg If you go down 20% one month, it takes much more of an increase than 20% to get the money back the next month.
980% was the total return from start to finish.
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Old Feb 3, 2011, 1:22pm   #181
 
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Re: Why do they do it?

I forgot to add: The result each month is calculated from the start of each month to the end of each month NOT from the initial starting balance.

That is probably why you came to that conclusion, SM :-)

E.g. in May 2010, I don't drawdown 31.49% of the entire account. I am down 31.49% from the beginning of the month to the end of it.
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Old Feb 3, 2011, 1:22pm   #182
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Re: Why do they do it?

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Originally Posted by trader_dante View Post
The net result is almost a 1,000% profit after 12 months trading but it doesn't come in the even distribution that all the newbies love....
Its sites such as T2W that are mainly responsible for setting exactly those kinds of unrealistic expectations. For the majority of people, forums are the single biggest obstacle to achieving profitability. Their sponsors must love them.
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