Edge - what is it?

[temptrader]

I do just fine buddy. It sounds like you are well versed in losing but lack any sort of knowledge about winning..

Oh, don't worry about me. You obviously don't have a clue.

Here's how this thread goes - or rather what you people want it to go:

1) someone mentions an edge

2) posters join in to have their take on it

3) someone clued up tells the truth

4) others join in and obscure the issue, putting in their views which are wrong, but what people want to hear

5) others not so clued up agree with view above

6) no real information is passed since what people want to hear is what's "decided" as the "truth" by most of the posters

see the pattern?

and it's like this with almost all the other threads: tedious, boring, and mainly rubbish being talked about.

I compare trading with the fashion industry: many young females in the population want to become models, but only a few can make it. The majority of the population are not much to look at, some are quite pretty but might not have the right look for the moment. But there are a few that are exceptionally pretty, and they get scouted, and win the big contracts, and have the lifestyles that others can only dream of . . .

An edge is applicable to any competitive activity, not only trading. To me, having an edge means possessing a quality and/or factor which gives you superiority over rivals, which is pretty much a dictionary definition.

that is exactly what an edge is, but people don't WANT to hear this, because it's implications are that most CANNOT have an edge, and therefore will lose eventually.

 

[porph]

Oh, don't worry about me. You obviously don't have a clue.

Here's how this thread goes - or rather what you people want it to go:

1) someone mentions an edge

2) posters join in to have their take on it

3) someone clued up tells the truth

4) others join in and obscure the issue, putting in their views which are wrong, but what people want to hear

5) others not so clued up agree with view above

6) no real information is passed since what people want to hear is what's "decided" as the "truth" by most of the posters

see the pattern?

and it's like this with almost all the other threads: tedious, boring, and mainly rubbish being talked about.

I compare trading with the fashion industry: many young females in the population want to become models, but only a few can make it. The majority of the population are not much to look at, some are quite pretty but might not have the right look for the moment. But there are a few that are exceptionally pretty, and they get scouted, and win the big contracts, and have the lifestyles that others can only dream of . . .

You clearly know little about the fashion industry either bud

Anyway, this is going no where.

 

[Jaydee]

Why do you think 99% fail at trading. It's not for want of trying. It's just that, brutally, they can't do it. Because of this fact, it would appear that most posters on this site will end up losing in the end - not something they want to admit to themselves.

That's why there are so many books, courses, seminars about. Headed by people who know total f*ck all, attended by people who are just as clueless. Some people actually take notes at these gatherings.

It's like everything else in life: there are those who CAN do it, and those who can't. Those who can't end up doing something else because they have no choice.

But because we are on a bulletin board, somehow it gives posters the right to think: "I'm on this bulletin board, I'm active in this community, therefore I have the right to succeed".

Temptrader, I don't wish to form part of an angry mob here just because your opinions are different from the norm but, equally I don't understand why you are in the community if you think everyone is a loser and have nothing to offer other than cynicism.

I hear your point about books, wafflers, fake traders, etc and, largely, agree with you - but you're only coming across as bitter. There is nothing wrong with constructive criticism but every post you make is 100% negative. If you are struggling to trade your attitude is far from helping. Why bother even getting out of bed?

 

[porph]

How about: http://www.trade2win.com/boards/general-trading-chat/45324-lost-money-well-s-nowhere-near-bad-guy-s-day.htm

 

[temptrader]

Temptrader, I don't wish to form part of an angry mob here just because your opinions are different from the norm but, equally I don't understand why you are in the community if you think everyone is a loser and have nothing to offer other than cynicism.

I hear your point about books, wafflers, fake traders, etc and, largely, agree with you - but you're only coming across as bitter. There is nothing wrong with constructive criticism but every post you make is 100% negative. If you are struggling to trade your attitude is far from helping. Why bother even getting out of bed?

this site has over 130,000 members, yet there is hardly anyone here who actually know what they are talking about. What was the fate of the charity trading account again?

"If you are struggling to trade your attitude is far from helping." would be like saying to an average looking girl: "if you're struggling to be a top model your attitude is far from helping". Do you see or not see?

I'm not 100% negative. I'm just telling you it's only a few that can do it, the rest just "kid" themselves that they can. That's what makes all these threads and this board absurdly funny . . . but you don't want to hear that, do you?

new_trader once said that everything for you to be successful is on this board. He was mainly referring to Socrates' posts. In that I agree with him. I agree with him in the sense that the Waterstones where I live has every book you need to be successful as a mathematician and may someday aim for the Sadlerian Chair at Cambridge, but alas only very few are capable of doing it because the amount of work and innate talent required is immense (READ: you won't have time for anything else).

anyway, as new_trader would say, time to unsubscribe

 

[the blades]

new_trader once said

LMFHO - he's now being quoted like some sort of inspirational guru.

A further question - as you failed to direct me to the posts by new_trader that I should follow;

Did he write these gems of wisdom before or after the night shift?

UTB

 

[the blades]

The top men who taught me will not converse with the public, because they get tired of explaining again and again their work. They are only interested in the best students, and have no time for morons, lazy apathetic people. And, bluntly, the public won't understand them anyway, and no matter how they try to explain the public will still not understand.

well then you've got your answer, time to pack it in fella.

You've been shown the way by the "top men" and you're still a loser. Oh dear. At least it's clear you're in the lazy, moronic category.

UTB

 

[Jaydee]

this site has over 130,000 members, yet there is hardly anyone here who actually know what they are talking about. What was the fate of the charity trading account again?

"If you are struggling to trade your attitude is far from helping." would be like saying to an average looking girl: "if you're struggling to be a top model your attitude is far from helping". Do you see or not see?

I'm not 100% negative. I'm just telling you it's only a few that can do it, the rest just "kid" themselves that they can. That's what makes all these threads and this board absurdly funny . . . but you don't want to hear that, do you?

new_trader once said that everything for you to be successful is on this board. He was mainly referring to Socrates' posts. In that I agree with him. I agree with him in the sense that the Waterstones where I live has every book you need to be successful as a mathematician and may someday aim for the Sadlerian Chair at Cambridge, but alas only very few are capable of doing it because the amount of work and innate talent required is immense (READ: you won't have time for anything else).

anyway, as new_trader would say, time to unsubscribe

Nobody here aspires to reach the likes of Soros or Cohen but that doesn't mean you can't be a trader. There are many divisions of football in the UK where players get paid - you don't have to be David Beckham to play football, enjoy it and make a bit of cash. Just as there are many models who make a decent living modelling for catalogues who aren't close to the success of Kate Moss. There are actors in TV adverts who will never make it to Hollywood but that doesn't stop them enjoying what they do. Need I go on?

Not everything in life is success above everybody else - part of it is enjoying what you do and trying to better yourself but your nihilist views don't seem to be able to grasp that.

I don't think people here are deluded; some might be, but most they are just having a go and trying their best to improve. To be honest, with your view, why have a go at anything? As I said before, why bother getting out of bed?

 

[forker]

an edge comes when you stop crying about losers and the bull5hit that comes from emotional trading and just get on with the job

 

[Joey25]

A positive expectancy combined with a drawdown which doesn't debilitate your / your investors' confidence.

 

[rnicoll]

I agree, the market can't be modelled entirely by maths (LTCM anyone?); unlike casino games where, over a long enough sample period, uncertain singular outcomes trend towards a certain average outcome. This is the 'je ne sais quoi' of the market and what makes it so interesting (for me at least).

I'm not sure it can't be modelled (in fact, I'm fairly sure it can be modelled), but the more I work on doing exactly that, the more I wonder if it's going to take less time than just doing it by hand. Essentially, it appears there are countless different factors to take into account, all occurring on different time frames, and even if you systematically evaluate and determine those, trying to figure out how to use them is going to be a nightmare. Essentially the shortest path to software that understands the market may be a limited-scope AI.

 

[rnicoll]

I believe that a certain level of intelligence is a requirement for this game but beyond that it makes sweet fa difference. I do agree that whilst you can be taught the tools, you really need to figure out how to use them by yourself.

Generally agreed. Some of us are working on very intelligence-focused approaches such as statistical analysis and automated trading, but unless you're doing something freakish like that I don't think you need much more than being able to think calmly through evidence presented to you.

 

[Skill Leverage]

My $0.02

I have purposefully stayed out of this argument until now, to see what the group consensus on 'edge' is. Some of you have a good understanding of the concept, others have an idea, some of you have completely missed the boat.

an edge to me is the key set of elements that allow one to trade profitably

Correct, although I would probably extend this to 'the key set of user-defined elements that allow one to trade profitably in the long term.

to have an edge is when you know that what you are about to do is going to turn out in the way you expect it, day in day out

rather simple

Rather simple, and rather spectacularly incorrect. If we knew the outcomes of our actions in the market day in day out, we would have a 100% winrate - unless you are implying that you know when you are placing a losing trade? Edge is all about probability, and nothing to do with certainty.

 

[AnEdge]

A repeatable, provable statistical advantage that allows you some edge. As you can see I take a quantitative/automated approach to the markets...the downside of this is that the markets are very efficient and it is not easy to find edges. For discretionary traders, some way of "feeling" what the market advantage is...

 

[everyonerich]

Edge is when you can make money from trendy market, as well as ranging market.

 

[Skill Leverage]

Edge is when you can make money from trendy market, as well as ranging market.

nope

 

[everyonerich]

nope

the world just doesnt work that way as everyone would have same opinions about the market. as long as it keeps making pips, it doesnt matter.


Everyone has different languages, different names and different symbols to describe and explain these things; and it is only when they narrow-mindedly cling to their one way of seeing things that intolerance view, pride and self-righteousness arise. Imagine an Englishman, a Frenchman, a Chinese and an Indonesian all looking at a cup. The Englishman says, "That's a cup." The Frenchman answers, "No it's not. It's a tasse." The Chinese comments, "You're both wrong. It's a pet." And the Indonesian laughs at the others and says "What fools you are. It's a cawan." The Englishman gets a dictionary and shows it to the others saying, "I can prove that it is a cup. My dictionary says so." "Then your dictionary is wrong," says the French- man "Because my dictionary clearly says it is a tasse." The Chinese scoffs at them. "My dictionary is thousands of years older than yours, so my dictionary must be right. And besides, more people speak Chinese than any other language, so it must be a pet." While they are squabbling and arguing with each other, a stranger comes up and drinks from the cup. After he has drunk, he says to the others, "Whether you call it a cup, a tasse, a pet or a cawan, a cup is meant to be used. Stop arguing and drink, stop squabbling and refresh your thirst."

 

[Skill Leverage]

Science isn't subject to opinion; it's not a case of the word 'edge' meaning different things to different people. If I thought Jaydee had wanted a semantic debate, I would have said 'edge is the sharp bit of a table'. What he was after was a discussion of the concept of edge as an intangible quality, which separates consistently profitable traders from the rest of the market.

You can trade a very narrow set of market conditions and still have a considerable edge; you've missed the point completely.

 

[zip2cosmic]

Arb traders in Chicago in the 1990's used edge to describe the potential profit a trade would capture. If you were buying a future and selling a synthetic future and capturing 2 points, the edge was 2 points. It is the profit you expect to make when initiating a trade.

 

[Skill Leverage]

Arb traders in Chicago in the 1990's used edge to describe the potential profit a trade would capture. If you were buying a future and selling a synthetic future and capturing 2 points, the edge was 2 points. It is the profit you expect to make when initiating a trade.

Theoretically, that would be known as expected value, but I'm sure edge is a cooler way of saying it