Do you agree with this statement?

[Big_P]

I was reading an article on the Telegraph website this afternoon ..

http://www.telegraph.co.uk/finance/...-lost-250k-but-made-it-all-back-and-more.html

In the article, there is the following :

"At-home traders, equipped with just an internet connection and basic software, rely on guesswork, said Mark Dampier, an investment expert at Hargreaves Lansdown. "It's a bit like professional gambling. Trading in seconds is the opposite of genuine long-term investing." Mr Dampier explained that it is impossible to predict short-term movements in the market unless you have inside knowledge - which is illegal. "There are far more losers than winners," he said."


Personally I think he is talking out of his backside. And this coming from an 'investment expert'.

What are your thoughts?

Big P

 

[Trader333]

He is right that most people lose money but if you think he is talking rubbish then why do you think that ?

 

[Big_P]

I was talking specifically about the comment "It is impossible to predict short-term movements in the market unless you have inside knowledge."

Whilst I think he is correct that you cannot predict EVERY movement with 100% certainty - it is possible to find short term movements which when traded (over time) will give a positive expectancy and therefore will make you money.

His statement implies it is not possible.

 

[Trader333]

Would you care to give an example as it appears that 90% are unable to do so ?

 

[Big_P]

Well , not without giving away 7 years of very hard work, no.

I trade the DAX on a 1 minute chart using just price action and volume. There are recurring patterns that will give a 55-60% strike rate with 2:1 profit/stop loss.

All you need to do is 'grind out' your edge (positive expectancy), and you can make money on those short term movements.

However, I only know this to be true on the instrument I trade. I am interested in others opinions with regards forex, commodities etc

 

[Trader333]

I think it is easier on futures than it is on instruments like forex and I agee that if you allow statistical probabilities to work out when having an edge then it will be profitable over the long term.

 

[ffsear]

I trade the DAX on a 1 minute chart using just price action and volume. There are recurring patterns that will give a 55-60% strike rate with 2:1 profit/stop loss.

was basically about to say this but your worded it much better then me!


I don't know why the word "edge" gets thrown around the trading industry so much. Edge applies to sport (unless you have inside information). Knowing a horse is injured, or a boxing match is rigged. That is what an edge is..

You don't need and edge in day trading.... CUT YOUR LOSSES EARLY AND LET YOUR WINNERS RUN!

Thats it!

 

[MajorMagnuM]

Would you care to give an example as it appears that 90% are unable to do so ?

yes happy to. All entries to achieve this were taken from 1 minute charts.

 

[drtro]

The best traders I talk to work remotely. They dislike trading on public floor because they are stuck there and wind up overtrading. They watch a fed meeting and stare at all the volatility then wind up gambling on the wide moves. At home, they can walk the dog or do some laundry while such events take place.

Nobody is ever going to be 100% trading short-term. But that doesn't mean it's impossible or will never be profitable. There are billionaire traders proving this guy is as delusional as Michael Lewis.

 

[MajorMagnuM]

In that online film the pit, the reactions of the traders to the decline of the floor and their attempts to adjust was interesting and informative. It was clear that something other than the delivery system had changed, but i cant see that being the influence of retail traders?

 

[Trader333]

yes happy to. All entries to achieve this were taken from 1 minute charts.

This shows nothing without evidence to back it up and I am not talking about hindsight entries and exits.

 

[malaguti]

I don't know why the word "edge" gets thrown around the trading industry so much. Edge applies to sport (unless you have inside information). Knowing a horse is injured, or a boxing match is rigged. That is what an edge is..

not necessarily mate. Having an edge, is having something that another doesn't, its that one step ahead of the competition. Competition isn't just sport
this from a dictionary..
Also, have the edge on. Have an advantage over, as in "Our team has an edge on them, or In this competition our town has the edge". The use of edge here alludes to the power to cut, transferred to a margin of superiority. [Late 1800s ]

In my opinion its a very useful phrase and pops up all the time for me, not just in trading but in business circles as well. Everywhere in fact. Sun Tzu and all that.

 

[tar]

There are billionaire traders proving this guy is as delusional as Michael Lewis.

Who ?

 

[MajorMagnuM]

This shows nothing without evidence to back it up and I am not talking about hindsight entries and exits.

so this continuity does not help?

 

[Splitlink]

I was reading an article on the Telegraph website this afternoon ..

http://www.telegraph.co.uk/finance/...-lost-250k-but-made-it-all-back-and-more.html

In the article, there is the following :

"At-home traders, equipped with just an internet connection and basic software, rely on guesswork, said Mark Dampier, an investment expert at Hargreaves Lansdown. "It's a bit like professional gambling. Trading in seconds is the opposite of genuine long-term investing." Mr Dampier explained that it is impossible to predict short-term movements in the market unless you have inside knowledge - which is illegal. "There are far more losers than winners," he said."


Personally I think he is talking out of his backside. And this coming from an 'investment expert'.

What are your thoughts?

Big P

My thoughts are that he is correct. Investing is safer than online trading. Investment should be judged by fundamentals, if one can afford the time. I used Sharescope. All I needed was there. Remember Warren Buffet, but don't try to copy him---he has a large organisation that cannot be imitated by one person, but he did say " I never invest in what I do not understand". I never invested in banks, or anything that could not give earnings, debt, etc. clearly, He missed out on the dotcom bubble. My bible was Jim Slater's "The Zulu Principle" and I recommend it for ordinary folk--I am thicker than most. My son bought me "The Intelligent Investor" but it is very American and I could not get into it.

Trading? I try to kid myself that I'm good--but I'm not. I just keep occupied in my retirement and I don't lose money but, with the years that I have been doing it, I should be richer than I am.

 

[MajorMagnuM]

or this post? 27097
http://www.trade2win.com/boards/dis...ng-calls-expert-retail-forex-trader-3871.html

or this post 27124 which was made 40 minutes before the move ,
http://www.trade2win.com/boards/dis...ert-retail-forex-trader-3875.html#post2413006

and post 27148
http://www.trade2win.com/boards/dis...ert-retail-forex-trader-3879.html#post2413088

Shame so much evidence is needed on an educational forum, but i understand why. is there a written policy in what constitutes evidence, as i suspect the above will qualify for some and not for others that use more formal ways of posting their thoughts.
ie long here to x/y with z pip stop loss.
personally I find that method does not fit trading m1. as i improve im sure i can adapt

 

[Sonicscooter]

"investment expert at Hargreaves Lansdown"

That sentence should tell you all you need to know...............end of chat.

 

[tar]

or this post? 27097
http://www.trade2win.com/boards/dis...ng-calls-expert-retail-forex-trader-3871.html

or this post 27124 which was made 40 minutes before the move ,
http://www.trade2win.com/boards/dis...ert-retail-forex-trader-3875.html#post2413006

and post 27148
http://www.trade2win.com/boards/dis...ert-retail-forex-trader-3879.html#post2413088

Shame so much evidence is needed on an educational forum, but i understand why. is there a written policy in what constitutes evidence, as i suspect the above will qualify for some and not for others that use more formal ways of posting their thoughts.
ie long here to x/y with z pip stop loss.
personally I find that method does not fit trading m1. as i improve im sure i can adapt

Evidence for what ?! I dont see any !

2850 plus is possible i think

well i see structure saying higher

gu 6019 could be a huge boost if it gets above that

 

[tar]

yes happy to. All entries to achieve this were taken from 1 minute charts.

so this continuity does not help?

no. demo. proof that this method is solid . All i need now is a better relationship with money

.

 

[barjon]

..............I trade the DAX on a 1 minute chart using just price action and volume. There are recurring patterns that will give a 55-60% strike rate with 2:1 profit/stop loss.............

Doesn't your example support what Dampier is saying? As a prediction you are saying that you are wrong 40-45% of the time. Your example is not one of straight directional prediction but of statistical probability that x is more likely than y - presumably what Dampier was getting at.