Something wrong...

This is a discussion on Something wrong... within the General Trading Chat forums, part of the Reception category; Just looking at some random internet definitions of gambling i.e. - To bet on an uncertain outcome, as of a ...

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Old Jun 4, 2011, 4:26pm   #31
Joined May 2007
Re: Something wrong...

Just looking at some random internet definitions of gambling i.e.
- To bet on an uncertain outcome, as of a contest.
- To play a game of chance for stakes.

Whatever terminology you prefer to use then most trading is gambling by those definitions as the outcome of a single trade is almost always uncertain at the outset. However the successful traders are those that have the knowledge / skill / experience to know that over a series of trades the odds are in their favour. Casino owners are gamblers in that they take the opposite side of every bet that is placed but even though they are gambling they have a very successful business model.
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Old Jun 4, 2011, 4:34pm   #32
 
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Re: Something wrong...

I'd say it is a form of gambling as the outcome cannot be known. It's not as if we are buying a load of fruit, putting a mark up on it and selling it for profit. Although I so like how Beginner Joe puts it.....

Quote:
Originally Posted by BeginnerJoe View Post
If you want to be pedantic, then crossing the road is a gamble. Since a lot of us are very proficient at it, we know we are not gambling. I am of the view that the difference between trading and gambling is risk control and profit performance. If you are consistently profitable, then you are doing trading rather than gambling.
The only difference really is that with trading you choose your own odds in the form of risk:reward, although this will obviously affect your hit rate.

Kimo, are you coaching now? If so what are you coaching and how much are you charging? Do you have a website?

Sam.
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Old Jun 4, 2011, 4:43pm   #33
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Re: Something wrong...

Quote:
Originally Posted by megamuel View Post
The only difference really is that with trading you choose your own odds in the form of risk:reward
See? This sacred cow again from people unwilling to do their own thinking.

I'll try one last time. "Choosing" your risk reward at 2:1 for example. You enter a trade, place a stop x from your entry, and a limit 2x from your entry. This tells you nothing about the probability, p of
i) your stop being hit
ii) your limit being filled
iii) your stop being hit before your limit
iv) your limit being filled before your stop

Perhaps the true odds on the trade are 90% that your "risk" gets hit, and 10% that you are "rewarded". Over a hundred trades, your results will be
(-x * 90) + (2x * 10) - which is a negative number for x > 0

I guess as long as you in in control by choosing your own odds...
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Old Jun 4, 2011, 4:54pm   #34
 
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Re: Something wrong...

I'm not saying that it can improve your trading, I'm just saying that it is decided by the trader/gambler unlike say horse racing odds. I always trade with 1:1 now
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Old Jun 4, 2011, 5:00pm   #35
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Re: Something wrong...

Quote:
Originally Posted by megamuel View Post
I'm not saying that it can improve your trading, I'm just saying that it is decided by the trader/gambler unlike say horse racing odds. I always trade with 1:1 now
This is like pulling teeth. The odds are set by the market. What you are talking about is your bet size, same as the horse gambler or roulette punter.

Lets make it very simple. You bet £10pp that the market will rise. If you are wrong, you will stop your loss at 10 points, or £100. If you are right, you will take your winnings at 10 points, or £100. This has absolutely nothing to do with the probability of the market going up, down, or sideways. Or anything to do with the probability of whether the market trades through your stop or target first.

You could take a trade in a market which had a 70% chance of going up ten points before it went down 10 points. You could either buy or sell, with a 10 point stop and target, eg 1:1.

Do you now see the difference between where you choose to place your orders, and the probability of one of your orders being filled before the other?

I should add that the horse racing odds are determined by the betting patterns of the public, and the gambler chooses which odds to bet on, and how much to bet.
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Old Jun 4, 2011, 5:23pm   #36
Joined Apr 2010
Re: Something wrong...

kimo'sabby started this thread
Quote:
Originally Posted by megamuel View Post
I'd say it is a form of gambling as the outcome cannot be known. It's not as if we are buying a load of fruit, putting a mark up on it and selling it for profit. Although I so like how Beginner Joe puts it.....



The only difference really is that with trading you choose your own odds in the form of risk:reward, although this will obviously affect your hit rate.

Kimo, are you coaching now? If so what are you coaching and how much are you charging? Do you have a website?

Sam.


I wouldn't charge a penny, everything you need is on T2W (you need to go back a few years). I blame spot forex for the demise.
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Old Jun 4, 2011, 5:27pm   #37
 
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Re: Something wrong...

Ok well don't pull your teeth out - I'm in agreement with everything you have said. I just wrongly described risk:reward as odds. I understand that they have no bearing on the market going up or down and that someones edge comes from knowing where to enter and exit, risk:reward should fit around that.

Sam.
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Old Jun 4, 2011, 5:29pm   #38
 
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Re: Something wrong...

Quote:
Originally Posted by kimo'sabby View Post
I wouldn't charge a penny, everything you need is on T2W (you need to go back a few years). I blame spot forex for the demise.
But it says you only registered in April 2010, did you have another username before this one?

Sam.
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Old Jun 4, 2011, 5:38pm   #39
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Re: Something wrong...

kimo'sabby started this thread
Quote:
Originally Posted by megamuel View Post
But it says you only registered in April 2010, did you have another username before this one?

Sam.

You'll have to explain, you've lost me. Are you saying that for me to have read posts from the past i would have had to have been around when they were originally posted?
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Old Jun 4, 2011, 5:52pm   #40
 
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Re: Something wrong...

I thought you were coaching because you have a vendor badge, when I asked you about it you said you wouldn't charge, its all on here. I assumed you meant your mentoring/coaching posts but as you said a few years back and you only registered last year I thought you might have another username. Were you not referring to posts by yourself? Sorry for the confusion!

Sam.
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