More experience, Less profits?

Mike Kshemaraja

Mike Kshemaraja

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Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?

Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
 
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I don't think so. It may be true only for some broker but not all. According to me "More experience, More profits".
 
In Wizards 1 (I think?) There was a I guy who completely overhauled all his methods based on his formidable experience and was set for his best ever year but paradoxically had a disastrous year.
I can't remember his name or much about him except all his experience didn't help him that year. Obviously he went on to make a fortune otherwise he'd never made it into the book!
 
MoonRocket said:
In Wizards 1 (I think?) There was a I guy who completely overhauled all his methods based on his formidable experience and was set for his best ever year but paradoxically had a disastrous year.
I can't remember his name or much about him except all his experience didn't help him that year. Obviously he went on to make a fortune otherwise he'd never made it into the book!
Click to expand...

I think Richard Dennis in his successful Turtle experiment wanted to recruit only people with little or not trading experiences, and I am sure he did for a reason.

I guess his "experience" was telling him that no experience was better.
 
Mike Kshemaraja said:
I think Richard Dennis in his successful Turtle experiment wanted to recruit only people with little or not trading experiences, and I am sure he did for a reason.

I guess his "experience" was telling him that no experience was better.
Click to expand...

Do your research better.
 
Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?

Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...

So, I suppose your advice to newbies is to make as much money as they can before they get kicked in the teeth?
 
Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?

Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...
It's possible... All depends on the specific person/situation.
 
Particularly when you are new and learning the ropes, it seems that there is an inverse correlation between how much you know and your trading results, ie the more you learn - sometimes the worse your results seem to get and no doubt this phenomenon can be for the reasons you mention (and others.) The author Malcolm Gladwell (Outliers, The Tipping Point etc...) argues that everything has a Tipping Point and my experience certainly bears this out such that all that extra knowledge/screentime/experience/effort can eventually bear fruit - but there is no guarantee of this and most don't/can't (mainly for mercantile reasons) understand this, let alone do the work required to at least give themselves the best chance of finding out.

G/L


Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?

Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...
 
bbmac said:
Particularly when you are new and learning the ropes, it seems that there is an inverse correlation between how much you know and your trading results, ie the more you learn - sometimes the worse your results seem to get and no doubt this phenomenon can be for the reasons you mention (and others.) The author Malcolm Gladwell (Outliers, The Tipping Point etc...) argues that everything has a Tipping Point and my experience certainly bears this out such that all that extra knowledge/screentime/experience/effort can eventually bear fruit - but there is no guarantee of this and most don't/can't (mainly for mercantile reasons) understand this, let alone do the work required to at least give themselves the best chance of finding out.

G/L
Click to expand...

Great and well articulated post in my view and really is all incapsulated in your signature.

Looking forward of more of your posts, I also can see that you are scalping currencies as I do, would be interesting to see how you trade if that is possible, of course.
 
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Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?

Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...

If you're an experienced trader it means you've managed to get through thousands of real trades with real money and at least keep your capital, if not grow it handsomely. For this to happen it implies a keen understanding and acceptance of risk management, from which a direct consequence is steady growth and small drawdowns. So if you are indeed experienced the chances of you taking a huge windfall profit from a few trades are slim, but likewise the chances of a blowout are as well. Of course there will always be outliers and market phases that are more profitable then others, but as a trader you must realize your first priority is preservation of capital.

Plenty of books have been written about the wildly successful traders, some of whom were very risk prone, however you never hear about the hundreds of thousands of ex-traders who blew out only to find themselves on the other side of the McDonald's counter. So the fact that these successes were outliers are not immediately apparent.

What I am getting at is that "good profits" are kept profits and only the experienced know how to keep their profits in their pockets and their shirts on their backs.
 
EulerFourier said:
Plenty of books have been written about the wildly successful traders, some of whom were very risk prone, however you never hear about the hundreds of thousands of ex-traders who blew out only to find themselves on the other side of the McDonald's counter. So the fact that these successes were outliers are not immediately apparent.
.
Click to expand...

We also hear from many alleged "successful traders" who actually were never such a thing, and they were good only to propagate that status for commercial purpose (publishing, system vendors and such). These so-called "experience traders" have built their alleged "experience" only based on this marketing garbage and have never had the courage/honesty/fortune to really get engaged with the essence of the market.
 
Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits,
Click to expand...
Yes, due to lower risk tolerance
Mike Kshemaraja said:
due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?
Click to expand...
Why would a strong concept of risk management be something you would want to shake off?

Mike Kshemaraja said:
Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...
Yes, markets are fluid, why does that mean risk should be?
Even if you vary position size based on ATR for instance, your risk control is still rigid.
Rigid control of how much you can lose is the only thing you decide.
The market decides how well you will be rewarded.

I couldn't care less about good profits.
Good profits without sane risk management is just gambling.
Give me good solid risk control and mediocre profits anyday.
 
Mike Kshemaraja said:
Is it possible that more experienced traders (and I am not referring to age) have less probability to make good profits, due to the fact that the consequences of being kicked in the teeth have built strong concepts that are impregnated in their mind and difficult to shake off?
Click to expand...

I don't think so. An experienced trader, by definition, is a successful trader and therefore will not have what you suggest impregnated in their mind.

Mike Kshemaraja said:
Those same concepts contain an underlying rigidity which is just the opposite of the nature of the market: fluidity, adaptability and constant revaluation.
Click to expand...

Again, I don't agree. Adapting to differing market conditions is part of the job but in the long term people are people and the market does not change as much as people make out imo.
 
Liquid validity said:
Yes, due to lower risk tolerance

Why would a strong concept of risk management be something you would want to shake off?


Yes, markets are fluid, why does that mean risk should be?
Even if you vary position size based on ATR for instance, your risk control is still rigid.
Rigid control of how much you can lose is the only thing you decide.
The market decides how well you will be rewarded.

I couldn't care less about good profits.
Good profits without sane risk management is just gambling.
Give me good solid risk control and mediocre profits anyday.
Click to expand...

Sorry your post in my view is really poor and your concepts are very rigid confirming my questioning.

That rigidity lays mostly on wanted to show the world "to be right" rather of to see thing for what they really are.
 
Mike Kshemaraja said:
Sorry your post in my view is really poor and your concepts are very rigid confirming my questioning.

That rigidity lays mostly on wanted to show the world "to be right" rather of to see thing for what they really are.
Click to expand...

:LOL: OK
 
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