Do you have an "edge" in your trading?

[HowardCohodas]

Just because it can't be PROVED doesn't mean it's not there.

That's a radical departure from the position of most of the frequent players here.

You're likely on dangerous ground given that I hold the same opinion. :-0

 

[nunrgguy]

Quote:
Originally Posted by the hare
The problem with most of the T2W dunces is that they're trying to catch little fish by waving a net ith a wide mesh in the air rather than dipping it in water !


Good analogy. Little fish = small wins compared to risk, mesh size = size of stop, air/sea = location, are we at supply/demand or just taking pot shots?. Waving in the air = taking big wild swoops at it, dipping it in the water = taking more than one pop at an entry. It all depends on what you read into it but from my point of view pretty damn good.

 

[TheBramble]

A fixation on ‘edge’ per se isn’t going to serve you in trading.

Some are going to maintain that the markets are the same as they have always been as are the people that trade them. This is of course quite untrue as even a cursory comparison of the differences between markets just 20 years ago and today will clearly show. The number and types of instruments available to trade. The number and types of participants in the market. The number and ease of access and use of electronic trading platforms and the profusion in number and type of exchanges just to start the list off.

There are some that will claim that an edge, once revealed, will be traded flat. Also demonstrably untrue. We still get trends…LOL.

Even with an ‘edge’ involving something a little more sophisticated than ‘going with the trend’ spelt out in fine detail would not end up being traded the same way by any real majority of those who thought they were trading it 100% to the letter.

Like Dinos,it took me a long time and a whole bunch of wonga to finally get it. He’s obviously smarter than me because I managed to dump my entire account 4 times before hitting my stride. It takes a lot of moxy to keep on keeping on in the face of the obvious. That’s probably the first and most important ‘edge’ you’ll need. But even that is not enough.

Intelligence doesn’t hurt, but trading specific smarts are probably more useful. How you get these is too simple, so most people go and make it more difficult thinking it needs to be. Dinos did. I did. Seems anywhere between 97% and 99% of aspiring traders don’t have either the wherewithal or the spirit to make it through this unnecessary stage of the need for over-complication.

There’s enough repetition in books, on sites like this and everywhere else you care to look of those techniques which will, over time, in aggregate, pay you a profit. These include all the good things like money management, risk control as well as trading techniques and setups themselves. In essence, there isn’t that much to learn about that which consistently works well, most of the time. Honestly. Lots of different flavours, sure, but not that many core factors.

Hunting for an ‘edge’ is like hunting for the Holy Grail. The majority of members on this site who are actively trading most likely already know all they need to know to make better than average or better than random decisions on what to trade and when to trade it. What the majority of these will do is exactly what I did (and probably what Dinos did) when they hit the first losing streak, they’ll stop what they’re doing and spend the next trading day hunting for what was ‘wrong’ with it or worse still, ‘refine it’ or alternatively, they’ll spend the next week (or month) looking for and avidly back-testing (with new indicators of course) a totally new method or system.
What they should have done, or course, is carry on trading the tried-and-tested system that was working just fine and will continue to do so, but which wont do so all the time, every trade.

I guess that’s the edge.

 

[Charlton]

Just a general heads up for any of the newer members: Beware anyone who uses animal analogies for trading.

But if you simply have to, wouldn't you better off listening at least to the one that won the race?

Oh Bramble - You have just invoked images of hedgehogs rolling down hills and Twig birds !

 

[TheBramble]

Oh Bramble - You have just invoked images of hedgehogs rolling down hills and Twig birds !

We're obviously on the same hill...

 

[Black Swan]

A fixation on ‘edge’ per se isn’t going to serve you in trading.

Some are going to maintain that the markets are the same as they have always been as are the people that trade them. This is of course quite untrue as even a cursory comparison of the differences between markets just 20 years ago and today will clearly show. The number and types of instruments available to trade. The number and types of participants in the market. The number and ease of access and use of electronic trading platforms and the profusion in number and type of exchanges just to start the list off.

There are some that will claim that an edge, once revealed, will be traded flat. Also demonstrably untrue. We still get trends…LOL.

Even with an ‘edge’ involving something a little more sophisticated than ‘going with the trend’ spelt out in fine detail would not end up being traded the same way by any real majority of those who thought they were trading it 100% to the letter.

Like Dinos,it took me a long time and a whole bunch of wonga to finally get it. He’s obviously smarter than me because I managed to dump my entire account 4 times before hitting my stride. It takes a lot of moxy to keep on keeping on in the face of the obvious. That’s probably the first and most important ‘edge’ you’ll need. But even that is not enough.

Intelligence doesn’t hurt, but trading specific smarts are probably more useful. How you get these is too simple, so most people go and make it more difficult thinking it needs to be. Dinos did. I did. Seems anywhere between 97% and 99% of aspiring traders don’t have either the wherewithal or the spirit to make it through this unnecessary stage of the need for over-complication.

There’s enough repetition in books, on sites like this and everywhere else you care to look of those techniques which will, over time, in aggregate, pay you a profit. These include all the good things like money management, risk control as well as trading techniques and setups themselves. In essence, there isn’t that much to learn about that which consistently works well, most of the time. Honestly. Lots of different flavours, sure, but not that many core factors.

Hunting for an ‘edge’ is like hunting for the Holy Grail. The majority of members on this site who are actively trading most likely already know all they need to know to make better than average or better than random decisions on what to trade and when to trade it. What the majority of these will do is exactly what I did (and probably what Dinos did) when they hit the first losing streak, they’ll stop what they’re doing and spend the next trading day hunting for what was ‘wrong’ with it or worse still, ‘refine it’ or alternatively, they’ll spend the next week (or month) looking for and avidly back-testing (with new indicators of course) a totally new method or system.
What they should have done, or course, is carry on trading the tried-and-tested system that was working just fine and will continue to do so, but which wont do so all the time, every trade.

I guess that’s the edge.

Top posting that buddy...but will they listen? Nooooo...

 

[DionysusToast]

If you like. A manufacturer uses futures to hedge. He loses a little on this activity every year, but this is simply a cost of doing business, like the insurance he pays on his buildings.

And of course, the problem is that the price instability he is hedging against it CAUSED by the futures markets in the first place.

Hence - they are not actually benefitting from the process but suffering. They have however brought into the myth that the futures markets provide benefits to business through price stability.

More here - http://www.trade2win.com/boards/general-trading-chat/86726-minus-sum-game-mk-ii-derivatives.html

Not much interest in the above thread but I do believe in the opinions stated therein.

 

[new_trader]

Some are going to maintain that the markets are the same as they have always been as are the people that trade them. This is of course quite untrue as even a cursory comparison of the differences between markets just 20 years ago and today will clearly show. The number and types of instruments available to trade. The number and types of participants in the market. The number and ease of access and use of electronic trading platforms and the profusion in number and type of exchanges just to start the list off.

And there you have it! Any trading book you have that was written prior to 1990 has just been rendered obsolete.


...What a load...

 

[TheBramble]

And there you have it! Any trading book you have that was written prior to 1990 has just been rendered obsolete.

Well, baby and bath water and all that...

Not ALL of it is still valid, but neither is ALL of it invalid.

You need to learn to discriminate. That's the whole point (the necessity actually) of on-going research & study.

Maybe that should count as another edge.

 

[new_trader]

Well, baby and bath water and all that...

Not ALL of it is still valid, but neither is ALL of it invalid.

You need to learn to discriminate. That's the whole point (the necessity actually) of on-going research & study.

Maybe that should count as another edge.

A successful trading methodology from 100 years ago is still valid today but you would have a hard time convincing newbies of this fact. This is why publishers make a fortune releasing a 'new' trading book every other month.

 

[Hotch]

You're likely on dangerous ground given that I hold the same opinion. :-0

I've changed my mind!

 

[meanreversion]

A successful trading methodology from 100 years ago is still valid today but you would have a hard time convincing newbies of this fact. This is why publishers make a fortune releasing a 'new' trading book every other month.

Richard Donchian would be over 100 if he were alive today. I wonder if he would join t2w if he was still alive... hmm...

Trend following is a funny one isn't it. If everyone tried it, it would lead to MORE trends as everyone would buy the breakout and hold etc. Then it would just be a case of who has the best exit strategy.. but then that's probably always been the case anyway.

Ramble over.

 

[new_trader]

Richard Donchian would be over 100 if he were alive today. I wonder if he would join t2w if he was still alive... hmm...

Trend following is a funny one isn't it. If everyone tried it, it would lead to MORE trends as everyone would buy the breakout and hold etc. Then it would just be a case of who has the best exit strategy.. but then that's probably always been the case anyway.

Ramble over.

I often wonder the same thing about Jesse Livermore. If he could read this thread would he think; "What!? Supply and demand isn't what it used to be!?"

 

[meanreversion]

I often wonder the same thing about Jesse Livermore. If he could read this thread would he think; "What!? Supply and demand isn't what it used to be!?"

Always amazes me at how many people idolise him as some kind of trading genius, a template to aspire to, altho presumably not the suicide thing??

 

[new_trader]

Always amazes me at how many people idolise him as some kind of trading genius, a template to aspire to, altho presumably not the suicide thing??

I suppose you either 'get' what he says or you don't. As for the suicide thing, you don't know what anyone here will do in 20 years time do you? Does that invalidate anything they have written 'today'?:idea:

 

[meanreversion]

No, of course not. But let's face it, Livermore was a fairly reckless trader. Perhaps he had the trading thing down, but his money management was not the best.

 

[TheBramble]

I often wonder the same thing about Jesse Livermore. If he could read this thread would he think; "What!? Supply and demand isn't what it used to be!?"

Jesse would definitely say that if he was exposed to LII spoofing. And he'd be right. And here's the crunch, he probably know how to adapt his strategy to handle it.

You getting the hang of this yet?

 

[new_trader]

Jesse would definitely say that if he was exposed to LII spoofing. And he'd be right. And here's the crunch, he probably know how to adapt his strategy to handle it.

You getting the hang of this yet?

Spoofing, you make me laugh.

 

[new_trader]

No, of course not. But let's face it, Livermore was a fairly reckless trader. Perhaps he had the trading thing down, but his money management was not the best.

Livermore admitted to having human weaknesses which caused him to succumb to stronger personalities, this caused him to change his opinion even when he was right. He also incurred losses when the exchange changed the rules when he was in a trade. He suffered from depression as well. These, in my opinion, are forgivable and he shouldn’t be labelled as a reckless trader. This is of course, just my opinion, but I’m sure there are traders here who have been swayed to do the opposite by opinions in this forum or by an analyst they saw on TV. This is generally why I switch my TV off and avoid (as much as possible) reading this forum or any market based website when I am watching the market.

 

[meanreversion]

Livermore admitted to having human weaknesses which caused him to succumb to stronger personalities, this caused him to change his opinion even when he was right. He also incurred losses when the exchange changed the rules when he was in a trade. He suffered from depression as well. These, in my opinion, are forgivable and he shouldn’t be labelled as a reckless trader. This is of course, just my opinion, but I’m sure there are traders here who have been swayed to do the opposite by opinions in this forum or by an analyst they saw on TV. This is generally why I switch my TV off and avoid (as much as possible) reading this forum or any market based website when I am watching the market.

Net worth 0 -> +$3mio -> minus $1mio -> +$100mio -> 0

Not reckless? Ok.