Just HOW do you make money in the markets?

This is a discussion on Just HOW do you make money in the markets? within the Trading Systems forums, part of the Methods category; I agree in the main with you, esp on all the TA stuff. People want to use TA in isolation ...

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Old Jan 4, 2010, 5:00am   #33
 
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Re: Just HOW do you make money in the markets?

I agree in the main with you, esp on all the TA stuff. People want to use TA in isolation because it removes the need to think and use a bit of discretion. It also leaves people with the idea that there can be a one size fits all approach.

For instance, how many times have we heard 'and reverse the methods for shorts' - downward moves do not necessarily move identically to upward ones, so why treat them the same ?

On these expert threads & systems - how many times do we hear people discuss obvious things that may impact the trade (consider stocks for instance)....

Enter on a technical signal UNLESS the company has an earnings announcement the next day/week.
Buy unless the company is soon to complete acquisition of another company.
Don't buy close to dividend payment date.
Enter short on a Goldman Sachs downgrade.
Exit position prior to an FOMC day.
Buy on low volume months where brokers will be pushing clients to trade so that they can hit their commission thresholds.

You don't see any of this stuff & it shows clearly that the people selling stock based systems are generally full of crap.

People just want to surf, find a set of simple rules, implement them and make a gazillion dollars. They do this despite the fact that there is zero evidence that anyone before them has done the same.

Really - who wants to spend the few weeks it takes to learn how the markets work when you can spend years testing out crappy TA based systems from the internet ?
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Old Jan 4, 2010, 5:22am   #34
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Re: Just HOW do you make money in the markets?

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Originally Posted by DionysusToast View Post
For instance, how many times have we heard 'and reverse the methods for shorts' - downward moves do not necessarily move identically to upward ones, so why treat them the same ?
Yup. The short side of the market is different from the long.

I did a little experiment of selecting a random portfolio of stocks from SPX, buying on stock CCI < -100 selling on CCI > 100 over five years of history where the SPX ended about where it started. It actually easily outperformed the SPX itself, though with hideous drawdowns.

I reversed the logic shorting on CCI > 100, covering on CCI < -100. Results were just horrible.

You can probably choose any fast oscillator and get the same result.

It is actually not very hard to show that short and long sides are different. Just look at the volatility.
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Old Jan 4, 2010, 6:06am   #35
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Re: Just HOW do you make money in the markets?

I have, always, used top and bottom patterns differently. I can never see a downward pullback in the same way as one in an uptrend. I've tried turning them upside down---no good!

Last edited by Splitlink; Jan 4, 2010 at 6:19am.
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Old Jan 4, 2010, 11:18am   #36
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Re: Just HOW do you make money in the markets?

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Originally Posted by DionysusToast View Post
People just want to surf, find a set of simple rules, implement them and make a gazillion dollars. They do this despite the fact that there is zero evidence that anyone before them has done the same.
And that statement there, IMO, is why there are some folk on this thread saying "stay off the 'net" and some are saying "wtf? the 'net is a great place to learn to trade" (emphasis on LEARN!). Because if you predicate that yes, SOME people just want to surf etc etc, then yeah, of course they are wasting their time, and they are going to end up disappointed. I just don't think it applies to every new trader. There are quite a few novices, here and elsewhere, that already know that, and have come here for specific advice or help with some part of their own learning process. And (again IMO), they can get that here.

keep on truckin
Tess
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Old Jan 4, 2010, 4:29pm   #37
 
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Re: Just HOW do you make money in the markets?

Highlander1 started this thread
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Originally Posted by Highlander1 View Post
Hello,
I'm trying to figure out which route to go to take a shot at making consistent money trading. I've been reading a lot of these posts here, and basically it seems like there are quite a few opinions on how NOT to make money. For instance: day trading-no way 'cause your computer/system/execution/bankroll etc... can't compete with the big boys & market makers; buying a canned system (i.e. "AbleTrend")-no way, 'cause if it was that simple everyone would be doing it, or, too expensive and trend following using EMA MA's is just as good & a lot cheaper; using " 'bots " for a fully automated system-no way, Star Treks' Mr. Data would have a hard time designing a good one;

And on and on and on...

So everyone, is ANYONE making money, and how?

I'm thinking a swing trading time frame, to help eliminate the execution headaches with active intraday trading; seems like it has become a high stakes video game rather than a exercise in strategic thinking. Options maybe?

Thanks in advance for your input!


Wow! And I thought trading the markets was going to be brutal.
The battles on this website rival those in Congress!
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Old Jan 4, 2010, 4:42pm   #38
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Re: Just HOW do you make money in the markets?

[QUOTE=Highlander1;1018026]So everyone, is ANYONE making money, and how?


I am, volatility = opportunity.
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Old Jan 5, 2010, 5:38am   #39
 
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Re: Just HOW do you make money in the markets?

Highlander1 started this thread Care to elaborate? Are you trading options and using high volatility to sell? Or are you just talking about wide swings in stock prices for regular trading?
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Old Jan 6, 2010, 11:20am   #40
 
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Re: Just HOW do you make money in the markets?

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Originally Posted by zupcon View Post
There's at least 3 of us on this thread who understand why its not such a great idea. Why would you wish to confuse someone with noise ?, its irresponsible to mislead people in that way.
Make that 4 !
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