The Pro's "je ne sais quoi"

[GammaJammer]

100% in agreement with this, I am...

Hmmm, and like Yoda you now sound. Hmmmm

 

[shortsell]

i think you would struggle to make a rational argument about who was the more competent athlete out of the 2.

 

[GammaJammer]

I know it is a different game but as sportsmen both ronaldo and kobe bryant probably share similar qualities as professional sportsmen. What I was asking was about a degree of competence I suppose.

or are you saying that the games are so wildly different that you cannot draw a parallel or comparisson?

Don't think there's a valid way to compare imho.

 

[Jaydee]

This is aimed at GJ and Martinghoul (and Arabian if he's around).

Is a good retailer as competent a trader as a good institutional and is it account/size/tools/facilities that differentiate?

Or is something else going on for the good institutionals?

Most retail traders on this board seem to be focused on directional strategies and, therefore, wouldn't nessessarily have the the required competance execution trading futures (which involves juggling a load of balls in the air and trying not to drop one of them) or trading a prop strat like closed-end fund arb, as a couple of examples.

Also, most traders in Banks are not prop traders (JP closed its prop desk and it only affected about 100 traders in London). Not only this, of the prop traders there are, most are not trading directional strategies using charts and TA.

So, it's a tough one to answer. I can't see why a good retail trader wouldn't be able to learn and become good in such an environment, however.

 

[robster970]

I thought that might be the case (you can't make a valid comparisson).

 

[Martinghoul]

This is aimed at GJ and Martinghoul (and Arabian if he's around).

Is a good retailer as competent a trader as a good institutional and is it account/size/tools/facilities that differentiate?

Or is something else going on for the good institutionals?

Personally, I see no reason why a retailer couldn't be as good as a reasonable institutional...

The advantage that institutional people have is a wider field to play in, which for a relative value person like myself means a lot more different wiggly bits to trade against each other.

 

[robster970]

I liken retailers to 2d characters living on a flat earth whilst institutionals are looking at them from a 3d perspective. I'm not denigrating retail traders nor am I necessarily elevating institutional traders but there is a gulf of context and perspective that is missing between the two worlds.

I get a sense of it only because old mates work in IB's and hedge funds on the trading end of things and it occassionally comes up in conversation - the diversity, variety and complexity. It was two of them that set me off on this retail road in the first place and I got a bit of help and advice from them at the outset.

 

[trader_dante]

The old saw is that 95% of amateur traders are unprofitable. Presumably this isn't the case with Pro traders under normal circumstances - or they wouldn't remain employed.

So what do the Pros do/not do or know, different to the amateur? Is one possibility that the very freedom enjoyed by amateurs (eg. no house rules / no supervising boss / trade whatever you like) is their downfall? Or, like amateur pilots/golfers/painters/authors - are some people just not cut out for the job?

So what are the lessons that 95% should learn from the Pros ?

This is ironic.

You gave the first reply to my own attempt at answering this same question

http://www.trade2win.com/boards/first-steps/34457-lessons-successful-traders.html

Take the 95% you mention.

They often aren't prepared to do #1.

They don't have the experience to utilise #3.

They don't realise #4.

They can rarely do #5.

They can do #6 but usually without a stop.

They haven't put in enough time to understand #7

They never remember #8 (hence the breakeven maneouvre)

#9 is too simple for them to bother with.

And they are too wrapped up in the 1m TF to see #10.

 

[charliechan]

Utter gibberish with random homophobia thrown in for good measure --- any moderators out there care to comment on why ODT is allowed to pollute this website?

havent you found the ignore facility?

i have and it's got one very exclusive member. i guess i should make it official:

ODT - WELCOME TO MY IGNORE LIST. POPULATION: YOU!!

dont bother replying cos i wont see it (but something tells me you will anyway - not that im missing anything)

 

[charliechan]

Most retail traders on this board seem to be focused on directional strategies and, therefore, wouldn't nessessarily have the the required competance execution trading futures (which involves juggling a load of balls in the air and trying not to drop one of them) or trading a prop strat like closed-end fund arb, as a couple of examples.

Also, most traders in Banks are not prop traders (JP closed its prop desk and it only affected about 100 traders in London). Not only this, of the prop traders there are, most are not trading directional strategies using charts and TA.

So, it's a tough one to answer. I can't see why a good retail trader wouldn't be able to learn and become good in such an environment, however.

i dont think its tough at all.

the retail trader has get rich quick as a motive, so goes daytrading momentum.

the pro understands get rich in due course. its not about working in a bank or fund, more about attitude and approach.

having said that, im not saying daytrading momentum cant be done - it can of cousrse. there are some excellent traders making stacks doing it. but in terms of odds of success, i think the day trading momentum gig has got to be the toughest one to crack and is more like gambling than any other hedged approach - its not exactly 'investor friendly' due to the vol of returns - so pros dont go there. also, it's far more intuitive, so not something a typical grad can pick up and be taught.

 

[oildaytrader]

i dont think its tough at all.

the retail trader has get rich quick as a motive, so goes daytrading momentum.

the pro understands get rich in due course. its not about working in a bank or fund, more about attitude and approach.

having said that, im not saying daytrading momentum cant be done - it can of cousrse. there are some excellent traders making stacks doing it. but in terms of odds of success, i think the day trading momentum gig has got to be the toughest one to crack and is more like gambling than any other hedged approach - its not exactly 'investor friendly' due to the vol of returns - so pros dont go there. also, it's far more intuitive, so not something a typical grad can pick up and be taught.

This post of mine is not a retaliation post.This man absolutely clueless on tradetoloose,like many others here.

What rubbish is being posted backed by no evidence.The man is completely incorrect.I actually run momentum strategies successfully.

 

[robster970]

I have a suspicion that most retailers have a go at daytrading at some point on their journey primarily because of (1) ego and (2) attracted by the lure of being in/out loads of times a day and making a mint quickly as you say. There is an upside to this. You end up doing a lot of trades. As you do a lot of trades you accelerate your learning because of the amount of screen time you end up dedicating to it. As your screen time goes up, your swing and position trading improves. You then end up realising that day trading is a load of agro but your swing trading has improved a right lot. You can then get selective about the odd day trade that is a no-brainer and jumps out at you.

I agree that the money is in the longer timeframe. I also think retailers lack patience on the whole. It took me 18 months to figure that one out.

 

[oildaytrader]

I agree that the money is in the longer timeframe. I also think retailers lack patience on the whole. It took me 18 months to figure that one out.

Ask yourself a serious question.What is going to happen to your longer time frame strategy , if markets become choppy and ranging in a consolidation with extremely high volatility?

 

[barjon]

I have a suspicion that most retailers have a go at daytrading at some point on their journey primarily because of (1) ego and (2) attracted by the lure of being in/out loads of times a day and making a mint quickly as you say. There is an upside to this. You end up doing a lot of trades. As you do a lot of trades you accelerate your learning because of the amount of screen time you end up dedicating to it. As your screen time goes up, your swing and position trading improves. You then end up realising that day trading is a load of agro but your swing trading has improved a right lot. You can then get selective about the odd day trade that is a no-brainer and jumps out at you.

I agree that the money is in the longer timeframe. I also think retailers lack patience on the whole. It took me 18 months to figure that one out.

Robbo

Yes, I do hope people take note and of the comments of those who really know what they are talking about like Gamma, Charlie, Arabian and TD. I somehow doubt it though, because it's a message no-one wants to hear - much better to listen to the siren songs of the make a million in five minutes brigade.

I'm not a pro and nothing but a trading hobbyist, but I have been doing it for over thirty years. Many times I've had patches where I could say "if this keeps up I'll be increasing my capital by several hundreds percent a year" but it never has kept up and I've had to be content with much more modest returns. So I'm not a decent trader, well -ok - but just ask yourself this. If all the pro traders habitually made the stellar percentage returns on their capital, year in year out, that newcomers seem to expect as a norm then how long would it be before all the money in the world was resting in their pockets?

jon

 

[Martinghoul]

Ask yourself a serious question.What is going to happen to your longer time frame strategy , if markets become choppy and ranging in a consolidation with extremely high volatility?

Apart from a fact that I don't know what a "choppy and ranging in a consolidation with extremely high volatility" mkt looks like, I have absolutely no idea why you think it will have any impact on the performance of, for example, my strategies.

Let me ask you a serious question. Why do you think you make money (if you do) or are going to make money (if you don't)? As someone who has thought about this long and hard (that, incidentally, is one of the rigors that an institutional context imposes), I have figured out an answer to this question for myself. Have you?

 

[robster970]

Ask yourself a serious question.What is going to happen to your longer time frame strategy , if markets become choppy and ranging in a consolidation with extremely high volatility?

It will be ok. I've no real inclination to disect how I trade publicly on here.

 

[oildaytrader]

Apart from a fact that I don't know what a "choppy and ranging in a consolidation with extremely high volatility" mkt looks like, I have absolutely no idea why you think it will have any impact on the performance of, for example, my strategies.

Let me ask you a serious question. Why do you think you make money (if you do) or are going to make money (if you don't)? As someone who has thought about this long and hard (that, incidentally, is one of the rigors that an institutional context imposes), I have figured out an answer to this question for myself. Have you?

I don't know your strategies and therefore unable to comment on them specifically.If volatility increases in a ranging market, stops get taken out more frequently and false trending entries get triggered more often ,leaving the equity curve in bad shape.

I have already figured out how I make money and why my methods are robust and reliable enough to survive and profit in most market conditions.

 

[Martinghoul]

I don't know your strategies and therefore unable to comment on them specifically.If volatility increases in a ranging market, stops get taken out more frequently and false trending entries get triggered more often ,leaving the equity curve in bad shape.

I have already figured out how I make money and why my methods are robust and reliable enough to survive and profit in most market conditions.

Yes, which is exactly why trades exist as part of a portfolio. That means that I (and people like myself) don't care about choppiness and my equity curve is left in a perfectly fine shape, thank you very much. Moreover, this should answer your question about timeframe.

Well, you would say that you have it all figured out, wouldn't you? If you have done that, indeed, you should be able to categorize your methodology into one of the several broad types of approaches. You can use your own terminology if you like; I should be able to understand.

 

[charliechan]

This is ironic.

You gave the first reply to my own attempt at answering this same question

http://www.trade2win.com/boards/first-steps/34457-lessons-successful-traders.html

Take the 95% you mention.

....

They can do #6 but usually without a stop.

stops are a massive difference between what the average retail joe and a professional will do.

stops are just a sales tactic used by brokers to fill more orders/generate more commission, disguised as 'education' and 'good risk management'. any one who makes a living in the markets knows this. spread betters love them and it seems even create special order types called trailing stops to encourage people to use them. why?

stops are probably one reason so many lose.

if one is skilled at reading a market, there is no need to put a stop in the market (usually at a point where everyone else has a stop based on TA). you keep a mental stop, and wait for the market to reach that point. hopefully it wont. if it does, sit and watch how the market trades at that level. will it continue or reverse? it avoids losing a good position and then seeing the market continue in your direction.

ta levels attract a load of liquidity/stops which are great to fiddle cos you know thats where the liqidity is.

the only stop you should employ (imo) is a dead stop in case of loss of connection or other technical failure.

 

[Chartsy]

ODT, i think i can comfortably say i am less of a twat than you, that's bad for you because, and arabian and many other great traders can vouch this, i'm a ****ing idiot.

i actually think you're making it up, you couldn't consistently be such an imbecile for so long without it being a **** take.

as for retailers vs professional; i'd say prop/IB would have waaaay lower comissions and probably better info and chat than the average forex skype room, i think it was lipschutz who said it was the flow of information from the interbank trading 'circle' that gave him his edge