I've never understood the concept of the edge...

scose-no-doubt

scose-no-doubt

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What is this "edge" that everybody talks about - this mysterious thing that doesn't exist unless you can define it?
When you consider that there are far better traders/more able participants out there than anyone on here then how can your edge perform when their edge is obviously better?
The only way I can see that us small timers can benefit in trading is piggybacking the bigger moves. If we can't move the market and we don't think that event x will lead to outcome y then the outcome of our entry is nothing but randomness and un/luckyness isn't it?
There is not often any guarantee of success in any trade. I doubt any of us knows anyone with a 100% hit rate. If the edge doesn't work 100% of the time is it not just a non-existent psychological crutch?
In short I think this edge mullarky is a load of tosh. Unless you're talking rebates, insider information etc.

Anyone care to help me understand this edge thingy because I may just be looking at this from the wrong angle. :)
 
scose-no-doubt said:
What is this "edge" that everybody talks about - this mysterious thing that doesn't exist unless you can define it?
Click to expand...

Yes, he is indeed a mystery with his majestic guitar playing and penchant for cr@p hats. He's an enigma and his presence has helped my trading enormously.

edge.jpg


Do I win a prize for most predictably sh1t gag?
 
Who is that and why do I know his face and stop flaming me robster and answer my question and get out after you've answered it and thank you in advance
 
The way I see it, traders who are consistently profitable with their trading style/method/strategy have an edge. Those who are not consistent have no edge. I don't think its any more complex than that is it?

Sam.
 
megamuel said:
The way I see it, traders who are consistently profitable with their trading style/method/strategy have an edge. Those who are not consistent have no edge. I don't think its any more complex than that is it?

Sam.
Click to expand...

I was about to post a reply stating "how can you ever say my edge is xxxx if it doesn't work 100% of the time?"
But then I realised that my desire for certainty in an uncertain profession is leading towards yet another fruitless endeavour.
I need to embrace the uncertain lol.
I think I need to get out of accountancy, it really is no good for trading.

Might as well delete this thread lol.
 
scose-no-doubt said:
Who is that and why do I know his face and stop flaming me robster and answer my question and get out after you've answered it and thank you in advance
Click to expand...

This Youtube video of Harry Enfield's Association Football skit should be studied for the insights it has into the retail trader


A typical retail performance can be seen in the first half of the game by the boys in long shorts.

The second half shows what happens when retail traders acquire an edge.

It's all very straight forward.
 
scose-no-doubt said:
I was about to post a reply stating "how can you ever say my edge is xxxx if it doesn't work 100% of the time?"
But then I realised that my desire for certainty in an uncertain profession is leading towards yet another fruitless endeavour.
I need to embrace the uncertain lol.
I think I need to get out of accountancy, it really is no good for trading.

Might as well delete this thread lol.
Click to expand...

Nothing is 100%. Treat trading as a business or an occupation - just like any business or occupation, not every single activity will be profitable. Do you make a profit on showering, or eating, or driving to work? No, but you might struggle to work or run your business without doing these things.

Nobody can predict the future, therefore you will have losses. Therefore losses (and accepting losses for what they are) are an integral part of successful trading.

Simple :).
 
I understand that and does the fact that the future cannot be predicted not render the concept of the edge void in any directional trading strategy?

I mean aside from just learning what makes your market move like everyone else has to? Then doesn't it just come down to information again?
 
scose-no-doubt said:
What is this "edge" that everybody talks about - this mysterious thing that doesn't exist unless you can define it?
When you consider that there are far better traders/more able participants out there than anyone on here then how can your edge perform when their edge is obviously better?
The only way I can see that us small timers can benefit in trading is piggybacking the bigger moves. If we can't move the market and we don't think that event x will lead to outcome y then the outcome of our entry is nothing but randomness and un/luckyness isn't it?
There is not often any guarantee of success in any trade. I doubt any of us knows anyone with a 100% hit rate. If the edge doesn't work 100% of the time is it not just a non-existent psychological crutch?
In short I think this edge mullarky is a load of tosh. Unless you're talking rebates, insider information etc.

Anyone care to help me understand this edge thingy because I may just be looking at this from the wrong angle. :)
Click to expand...


Come on now. If you don't have an edge, it wold be wrong to put on even one trade. It would be pure gambling, in that there is no way to use skills, knowledge or judgement to aid your decision-making. An edge of 1% can make you a fortune.
 
scose-no-doubt said:
I understand that and does the fact that the future cannot be predicted not render the concept of the edge void in any directional trading strategy?
Click to expand...

It's just a way of describing the advantage that people think they have over other market participants. Of course one does not need any such advantage - one does not trade against anyone else, one does not "beat" other traders, take their money, and all the other nonsense that is bandied about. Forex is not about beating other people, nor is it a zero sum game except in the narrowest sense that ignores the true purpose of the forex market.

Don't worry about "edge" and other claptrap, just focus on developing a method that works for you. You are the enemy you have to beat in order to succeed - realising that is big "edge" on its own.

I realise that others will disagree, and I can appreciate why. It is just a lot more helpful (to my mind) to think about things in a more literal way - it will help you focus on what is important.
 
scose-no-doubt said:
I understand that and does the fact that the future cannot be predicted not render the concept of the edge void in any directional trading strategy?
Click to expand...

No, because the edge only plays out over a statistically significant number of trades. It is not based on one trade. What constitutes your edge will be unique to you if discretionary in any sense and not unique to you if mechanical/indicator based. Hybrid of mechanical and discretionary is still discretionary.

There's money in directional trading by following the herd either trend following or momentum. Getting out is the trick, not necessarily getting in.
 
Its not Yoda, its Sun T'zu. You can't know everything that will happen, but you must always know what you will do about it.
 
scose-no-doubt said:
Wtf does that mean? I've never understood this Yoda stuff either.
Click to expand...

Hi Scose,

It's not meant to be mystical or mumbo jumbo. It is however a little difficult to explain effectively, because it is a realisation that most people must come to themselves.

It sounds like you might be a little frustrated because you haven't found a workable method yet (apologies if this is not the case, it's just how it sounds to me).

This bit might be difficult to grasp if so, but I promise you that it is the truth:

Your method or "system" is a tiny part of being a successful trader.

If you're looking for the secret of forex or the holy grail, that will do as well as anything.

It is not the method that works, it is the trader that makes it work. It is simple to trade price action very profitably, for example. It is also extremely hard. What makes it hard is not identifying good entries (pitifully simple), nor even trade management and exits (more involved but very doable with a little practice), but having the patience to wait for them, and the confidence in your method to manage them properly when they occur.

In this example, it is not the market that beats you, or your bucket shop broker that screws you, or your crappy system that lets you down. It is the fact that you have not developed the patience to apply your method correctly.

Trust me, taking good PA at good locations is all the "method" you need. You can learn this for free, or there are good groups you can join to refine it, speed up the learning process, and get help.

But this will not bring you success - the key to trading in this manner is patience and discipline. Starting with a small account, it will take several years to build it up to the point where you will see significant returns in cash terms, even if you add to your account as your skills improve.

Most people lack the patience and perseverance to do this and so they fail. They will not stick with a method, they jump between "systems" (ugh! awful word), they double up, they revenge trade, and all the rest.

These traders do not succeed because they fail to master themselves - their emotions, their fear, their greed, their impatience.

Your enemy is you, not the market.

I hope this makes sense, because when you accept this you will have a chance to free yourself of all the nonsense that most would-be traders drag around with them. I know, because I have wasted a long time trying to force the market to do what I want it to, instead of training myself to trade what the market offers.
 
Last edited:
William Waller said:
Don't worry about "edge" and other claptrap, just focus on developing a method that works for you. You are the enemy you have to beat in order to succeed - realising that is big "edge" on its own.

I realise that others will disagree, and I can appreciate why. It is just a lot more helpful (to my mind) to think about things in a more literal way - it will help you focus on what is important.
Click to expand...

WELL Said
 
robster970 said:
Yes, he is indeed a mystery with his majestic guitar playing and penchant for cr@p hats. He's an enigma and his presence has helped my trading enormously.

edge.jpg


Do I win a prize for most predictably sh1t gag?
Click to expand...

Is this gentleman a member of one of those modern beat combo thingies that the young hepcats are always getting so excited about, or is he just another long-distance lorry driver wanted for questioning in connection with a serious sexual offence committed just off the M6 in Staffordshire (it always seems to be up there somewhere)?
 
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