Kiss

[tune]

But having a high-rate means nothing on it's own... after all he was just scalping for a handful of points...

You don't say.

 

[BSD]

Tune, achieving a high hit rate isn't hard, eg Marty Schwartz who wrote the excellent PIT BULL and was in Market Wizards, achieved a hit rate of 70 - 80%, but, like Firewalker said, he did it by only going after a handful of pips / points, AND through his risk / reward ratios, ie he had bigger stop losses than take profits.

Marty Schwartz's risk is one R, but his profits are 0.5 R, ie he risks 4 points, but banks two.

You can have fully mechanical systems that even have random entries provided they have a trend filter that generate high hit rates in the 80's BUT that are NOT very profitable.

EG:

Random entry, stop 3R, target 1R = 70% hit rate already,
cut the target to o.5% while keeping the 3R stop, and hey presto win rate of 82% !!!
Linda Bradford Raschke - LBR Group

Again, there is nothing wrong with high hit rate strategies whatsoever, but they are not the holy grail let alone the only way to make money, plus they are not scalable.

BUT of FAR greater importance is doing what you feel comfortable with, and if thats high hit rate that is just fine.

But what simply does not exist in the real world, outside of the phantasies of pretenders, is high hit rate AND great RR's in the same system, that combination would make you the richest guy on the planet in no time.

 

[JTrader]

This is all becoming circular, and is well past the point of the thread (sorry, wasp), and one eventually gets back to what chump was saying in the stop loss thread about mechanical vs discretionary.

If everything that can be said has been said, can't we just leave it and move on to something else? Like the topic?

...But my points made were good ones.

Yes, sure, be my guest.
Let all the derailers & those that fan their fumes step aside.

 

[wasp]

Can a mod please split this thread as whilst I don't argue the importance, hit rate and R;R is a different thread topic.

Thanks

 

[tune]

I understand the basics and have nothing against high, low, medium, throw darts, whatever. Just wondered what the best stats you've ever come across were. Or anyone else who keeps numbers, for that matter.

 

[BSD]

Tune, I think the best I ever heard was in the 90's, but the guy wasn't net profitable and stopped trading a few years ago.

The best I heard that works and works extremely well judging from their four wheeled toys are some DAX scalpers I know, not all, but some of them don't even have charts those guys, just the numbers on a screen in front of them, a straight line to the exchange, membership commissions, and they're in the 70 - 80% range like Schwartz, also have larger SL's than TP's like him.

Also, and in tune with Wasps thread here, they have really really simple KISS systems, nothing than trend, support and resistance.

The guys without charts just do it in their heads, they can see numbers is the best way they can describe it.

Hundreds of round turns / day, phew...

 

[ammo]

Tune, I think the best I ever heard was in the 90's, but the guy wasn't net profitable and stopped trading a few years ago.

The best I heard that works and works extremely well judging from their four wheeled toys are some DAX scalpers I know, not all, but some of them don't even have charts those guys, just the numbers on a screen in front of them, a straight line to the exchange, membership commissions, and they're in the 70 - 80% range like Schwartz, also have larger SL's than TP's like him.

Also, and in tune with Wasps thread here, they have really really simple KISS systems, nothing than trend, support and resistance.

The guys without charts just do it in their heads, they can see numbers is the best way they can describe it.

Hundreds of round turns / day, phew...

the pit traders trade as a herd,and there indicators are/were the public orders coming into pit,and in a herd you can feel the momentum like the wind,hard to do from a laptop

 

[Crap Buddist]

Call in the Diet Doctors

A friend emailed me this a while back.

as ever, do what the market tells you to do, not what you think.
this is not about being the boss.
this about being told what to do and then doing it.
submission is how you win.
the irony of it all.

yah good point on the submissive or run with the market.


And it would help perhaps if students of the markets spent a bit of time on the following chapter of the book..

The process of Identifying, measuring, recording & interperating the price of an asset to permit users to make (profit from) informed decisions based on & with regards to the assets historic,current & anticipated price trend.


Often this chapter is skipped , covered in graffiti or the pages ripped out and eaten by the hungry student who cant wait, on way to the fast food section to graze and binge. Until the diet is corrected its a question of continual management of internal cramps, toxins and discomfort until the blockage is cleared.

Fast food for traders, trader feed.

 

[new_trader]

A friend emailed me this a while back.

as ever, do what the market tells you to do, not what you think.
this is not about being the boss.
this about being told what to do and then doing it.
submission is how you win.
the irony of it all.

Exactly.

 

[DC STOXX]

But....
Why are they doing that then?
It doesn't look fun!

Cheers,
Neil

Doing that is how they made their money i would guess

 

[temptrader]

Nope.

I really and absolutely have zero problems with confidence when trading a low hit rate style.

To me it's about one thing, and one thing only:

Maximising profitability with a style that is as scalable as it gets.

And the way to do that is through low hit rate strategies that clean up on big moves.

Brett Steenbarger:

"...As a rule, maximizing batting average/minimizing drawdown comes at the cost of lowering overall system profitability...."

Lets face it, I have full respect for people like Marty Schwartz with their high hit rate strategies, but it's not rocket science, the way he does that is simply through having bigger Stop Losses than Take Profits, and by simply going for tiny moves of a few points at a time.

And it comes at the massive cost that it is not scalable which is why he failed with his hedge fund.

High hit rate doesn't mean one understands markets better which is just snakeoil nonsense anyway, bragging on boards, high hit rate just means your stop losses are bigger than your take profits, and that you're just going after tiny pip / point amounts, high hit rate is just a feel-good factor.

Kenneth Grant, in "Trading Risk: Enhanced Profitability through Risk Control", depicts his experience as risk manager for some of the best and most successful hedge funds, amongst others Paul Tudor Jones funds and Steve Cohens SAC Capital, that:

ACROSS ALL TRADING STYLES, TIME FRAMES, MARKET CONDITIONS AND TRADERS, ONE RULE HOLDS TRUE:

10% OF ALL TRADES INEVITABLY ACCOUNT FOR 90% OF PROFITS !


I emailed with him after I read his book, and he guaranteed that he'd be able to provide anyone with a very lucrative job with excellent profit sharing schemes at the hedge funds he's worked at who has a better documented (!) track record than that over a couple of years.

Just doesn't happen, blabbers on boards aside with no track record, and / or who do not trade for a living.

Trader Dante here is one of the very few people on here who has the potential to earn himself a massive fortune and get really, really rich, because he fully understands what it's all about, outstanding risk / reward ratios.

He has a simple, robust system, and he understands the immense importance of really really letting his winners run to maximise profitability to the hilt.

"I will tell you all now: I give A LOT of money back to the market in terms of being in profit and then being taken out for break even.

But I make MUCH MORE than I give back by playing this way because when I have a good entry and the price takes off without looking back, you can find yourself at the beginning of MAJOR moves that boast incredible R:R."
http://www.trade2win.com/boards/first-steps/26947-making-money-trading-28.html#post367227

That's where his success comes from, that's why he made thousands of percent profit in half a year (OK, betting the ranch initially didn't hurt), and that's why he's found a prop firm that trust him with their money which is the next step on his path to success which will definitely come if he keeps up what he's been doing.

Walking the talk, in other words, while others just talk.

Really? LOL!!!

I don't care about Kenneth Grant, or Brett Steenbarger or whoever you refer to.

So I must be a liar if I can make 15 winning trades in a row? Or have a overall win percentage of >80%? Good God, do I get eggs pelted at me for saying that?

Why would I want a job at a hedge fund? What for? Waste of time. Rather be in the background, harmless and not draw attention to myself.

If you want to talk about statistical systems, you may. But not everyone has to use them, nor are they the only route to success in this game.

 

[PKFFW]

.......So I must be a liar if I can make 15 winning trades in a row? Or have a overall win percentage of >80%? Good God, do I get eggs pelted at me for saying that?
......Rather be in the background, harmless and not draw attention to myself.

And yet you dig up a dead thread to blow your own horn in?

You need a hobby I reckon.

Cheers,
PKFFW

 

[new_trader]

Really? LOL!!!

I don't care about Kenneth Grant, or Brett Steenbarger or whoever you refer to.

So I must be a liar if I can make 15 winning trades in a row? Or have a overall win percentage of >80%? Good God, do I get eggs pelted at me for saying that?

Why would I want a job at a hedge fund? What for? Waste of time. Rather be in the background, harmless and not draw attention to myself.

If you want to talk about statistical systems, you may. But not everyone has to use them, nor are they the only route to success in this game.

Exactly.

 

[forexmilio]

Why do we make things more difficult than they are?

Supply, demand and the trend, be it a 5 minute time frame or weekly, its all the same and thats all that matters. Why make things any more complicated? and why does it take so long to realise it?!!!!

Generally nobody always win - sometimes there are losses inorder to win - but at the end you win--kiss

 

[elovemer]

rule of when holmes