How long did it take you to realize that you will never be profitable trading

NVP

Legendary member
36,880 1,900
True. That plus cutting one's losses short and letting one's winners run, perhaps the most common flaw in unsuccessful traders. And not having a robust plan to begin with, in which case cutting one's losses short doesn't accomplish much beyond postponing the inevitable.

If one hasn't found an edge in six months to a year, he's not trying and really ought to just hang it up.
hey Dbp..........6 months is just warming up surely ?.........even the basics of good trading that are needed to support that edge (MM , Entries , Exits , Platform & Broker choice and management, funding) will take time and practice to align and perfect .........and that's before you even start figuring out your edge ............which will take years of research, practice and ususally at least 1-2 mentors to hammer you into place

6 months is just a brief introduction to the ropes........surely ?

N
 

NVP

Legendary member
36,880 1,900
Yes, these kinds of folks tend to dominate this forum. However, there are some experienced traders here who make money, and a few clever individuals who are using sophisticated algorithmic trading strategies. (I've been private messaging with a couple of them.) I'm using a statistical arbitrage approach that I've developed myself which has made me 32% return in the past 9 months, trading only once per week. Time will tell whether this pans out in the long run. In any case, unless you are confident you have an edge, it's probably best not to trade.
how many trades have you taken for that 9 months IFF.......presumably just 30-40 ?
 

NVP

Legendary member
36,880 1,900
I agree. Most traders keep tweaking their Plan because that's what we've always been taught: having an idea that makes sense plus a solid plan.
But what is actually much more important is defining and measuring an edge before you can put together a plan to exploit it.
People buy at some line or moving average, then the stock bounces and gets to their profit target (at some other line). Then they believe they've found an edge and make a Plan around that... when in reality it is highly highly likely that it was pure chance and those support lines or moving averages just happened to be on the chart when they looked at it.
Then people analyze their trades thinking they made mistakes on the losing trades, when in reality there wasn't any edge there to begin with and the winning trades were purely random (and/or there was actually a different type of edge in some of them, which the trader doesn't understand).

You have the volatility contraction edge (pre-breakout or pullback in a trend) and you have the volatility expansion edge (shorting pops). Without getting into too much detail, those are the only edges you have to work with in directional trading. These edges are very small. There isn't much (if any) room for error to work with AND there is way too much reliance on pure chance due to how small those edges are.

Another thing is that it's impossible to keep ALL of your losses to 1R. If you trade for at least a few years, occasionally you will have losses that are way way more than 1R.



I am not sure yet.

I would love to be proven wrong but so far all I've seen was:
1. people who are not profitable but think "they almost got it"
2. people who exaggerate their profitability and their knowledge and make money on subscription services, marketing, writing, etc.
hey Rex..

first of all its a shame that you have not been lucky enough to find someone who is profitable consistently and is happy to train you.......

then again that is indeed a rarity .......but of course successful retail traders do exist ............they just don't share or train people ....why should they ........unless for various reasons it is in their interest or they have reached a point in their trading career where they want to give back a little .....something quite a few do (unlike what most here will tell you at T2win)

this is not as noble or rare as people think .......most successful traders truly feel they can train others to do what they do .........and it becomes yet another challenge that they embrace ...as they have already cracked the markets so why not take it to the next level with others ?

sure T2win is full of various traders of varying levels and scammers and wannabees ......check out any trading forum and the same profile exists......and I would never recommend anyone believe a word said in the forums either........

but if you are a trader or interesting in trading then forums are the places to at least monitor and read (warts and all) .........you will pick up the odd decent nuggets/advice plus find a few fellow traders you may want to work with over time ...... and indeed learn what not to follow or try ..........but professionals must always immerse themselves in their industry and are plugged into everything 24/7

that's what they do .......its their life and they wouldn't be doing anything else

N
 

metrader

Experienced member
1,147 141
How long did it take you to realize that you have no edge as a retail trader?
Perhaps some came to that realization after trading for a few years
Perhaps someone got it after running backtests

How long did it take everyone to realize that over a long period of time, there isn't an edge big enough to be profitable as a retail trader?

And how many are still delusional and think "they almost got it" and they will start being profitable after a few tweaks?
It took me years to realize that some brokers won't allow you to have an edge – they don't want you to take any money from them. So, first you need to see if you can beat the market on a demo account. Once you achieve such a thing (if ever), you have to choose a right broker to keep making money. It's that simple.

PS With a crooked broker you stand no chance & have no edges whatsoever

PPS If you can't beat the market on a demo, just think about something else (that way you can save a lot of time, money and avoid aggravation)
 

dbphoenix

Legendary member
6,952 1,244
hey Dbp..........6 months is just warming up surely ?.........even the basics of good trading that are needed to support that edge (MM , Entries , Exits , Platform & Broker choice and management, funding) will take time and practice to align and perfect .........and that's before you even start figuring out your edge ............which will take years of research, practice and ususally at least 1-2 mentors to hammer you into place

6 months is just a brief introduction to the ropes........surely ?

N
Brokers, platforms and funding aren't pertinent to understanding how price moves. Children aren't concerned with any of that, yet they have little trouble with distinguishing between up and down.

Depends in large part how badly one wants it. This isn't the 70s. We have computers now, and the internet, and digital books and blogs and articles, and streaming data, and replay. If, for example, one determines that the first 90 minutes of the trading session are generally the most active and potentially the most profitable, he can replay two sessions of 90 minutes each in one evening. If he plays them at 2X (two times normal speed), he can cover them in 90 minutes total. That is at least 14 sessions in one week. And as there are 250 trading days in a year, he can cover that year in 18 weeks. Four-and-a-half months. And if he logs in extra sessions on the weekends, he can cover a year in even less than that. And at the end of this time, if he has not done so already, he will be in a position to begin formulating a trading plan. Tentative, perhaps, but a potentially robust trading plan nonetheless.

But that isn't what beginners want to do. They want it quick and easy. They want to begin trading tomorrow, if not this afternoon. And they spend years in their search for the quick and easy. If the money lasts that long. One need only look at the kinds of questions beginners ask and the kinds of charts they look at to determine which may succeed and which will fail. Unfortunately there are a great many more of the latter than the former.
 

IFeelFree

Active member
109 19
how many trades have you taken for that 9 months IFF.......presumably just 30-40 ?
39 live trades. However, I've done 5 1/2 years of backtesting which involved 286 trades (about one trade per week) and showed an average yearly return of about 50%, with 10.2% maximum drawdown. The model has no free parameters except for buy/sell thresholds, which are determined via backtesting. (When an indicator exceeds one threshold I go long, when it drops below another threshold, I exit the long. Similarly, for shorting.)
 

samfarrell

Member
82 9
How long did it take you to realize that you have no edge as a retail trader?
Perhaps some came to that realization after trading for a few years
Perhaps someone got it after running backtests

How long did it take everyone to realize that over a long period of time, there isn't an edge big enough to be profitable as a retail trader?

And how many are still delusional and think "they almost got it" and they will start being profitable after a few tweaks?
It sounds like you were not successful so therefore no one else can be?
I suppose thats a natural human reaction to failure

Most traders will not be successful, that is true. But there are always going to be exceptions or outlyers to any statistical sample, always
 

rexlord

Junior member
36 3
All correct, except for the suggestion that the edges are small and that large losses are necessary.
Unless you are just incredibly lucky, there is no way to avoid some trades gapping against you. Nor can you really control whether it will be a 2R or a 5R loss.

Yes, these kinds of folks tend to dominate this forum. However, there are some experienced traders here who make money, and a few clever individuals who are using sophisticated algorithmic trading strategies. (I've been private messaging with a couple of them.) I'm using a statistical arbitrage approach that I've developed myself which has made me 32% return in the past 9 months, trading only once per week. Time will tell whether this pans out in the long run. In any case, unless you are confident you have an edge, it's probably best not to trade.
Like you said, time will tell.
As I am sure you know, some edges exist only during certain times (until enough people catch on). And when that edge is gone all of a sudden, there is (typically) no way to know that it's gone. Especially when a trader has strong conviction, they'll keep trading the same setup even after there is no edge there anymore. I've definitely seen it happen.
But I honestly hope that you have a means to prevent that. Best of luck!(y)

rex, you ever considered that you might be looking in the wrong place for an edge?
Anything is possible, I only consider my point valid until proven otherwise.
Like I said in one of my previous posts, I believe there is only two types of edges in directional trading. And those edges aren't really big enough to do anything with for a typical retail trader.
 

rexlord

Junior member
36 3
hey Rex..

first of all its a shame that you have not been lucky enough to find someone who is profitable consistently and is happy to train you.......

then again that is indeed a rarity .......but of course successful retail traders do exist ............they just don't share or train people ....why should they ........unless for various reasons it is in their interest or they have reached a point in their trading career where they want to give back a little .....something quite a few do (unlike what most here will tell you at T2win)

this is not as noble or rare as people think .......most successful traders truly feel they can train others to do what they do .........and it becomes yet another challenge that they embrace ...as they have already cracked the markets so why not take it to the next level with others ?

sure T2win is full of various traders of varying levels and scammers and wannabees ......check out any trading forum and the same profile exists......and I would never recommend anyone believe a word said in the forums either........

but if you are a trader or interesting in trading then forums are the places to at least monitor and read (warts and all) .........you will pick up the odd decent nuggets/advice plus find a few fellow traders you may want to work with over time ...... and indeed learn what not to follow or try ..........but professionals must always immerse themselves in their industry and are plugged into everything 24/7

that's what they do .......its their life and they wouldn't be doing anything else

N
I did find many retail traders who are profitable consistently. Though all of them (no exception) make their money via marketing, teaching, and/or other side business.

I've also seen many many "traders" online who claim absolutely insane profitability daily. I've seen the same pattern with all of them: they claim to be purely discretionary traders when it comes to entry/exit and size; absolutely no consistency - all based on discretion. Which is just one of the huge red flags. And then, of course, all of them do some sort of marketing "on the side".

It is not possible to "crack the markets". Any real successful trader (not retail) usually says that they've been a student of the markets their entire life time, which I completely agree with.

It sounds like you were not successful so therefore no one else can be?
I suppose thats a natural human reaction to failure

Most traders will not be successful, that is true. But there are always going to be exceptions or outlyers to any statistical sample, always
I completely agree that there will always be outliers, though they are probably somewhere in the 1% (or less).

Just because I am not successful, doesn't mean others can't be successful IF I see others who did succeed. I've never seen a successful retail trader. Maybe there are some exceptions, like you mentioned, but they are the outliers. That is exactly why it's safe to assume that everyone reading this thread is probably not one of the rare outliers.
 

dbphoenix

Legendary member
6,952 1,244
Originally Posted by dbphoenix
All correct, except for the suggestion that the edges are small and that large losses are necessary.
Unless you are just incredibly lucky, there is no way to avoid some trades gapping against you. Nor can you really control whether it will be a 2R or a 5R loss.
1. Depends on what you're trading. If you don't like gaps, trade futures. I trade the NQ.

2. Losses are controlled by exiting the trade when it is no longer doing what one expected it to do, all of which is a function of the trading plan. If the trading plan does not address trade management in detail, it won't be of much use, if any, when it needs to be.

Perhaps you need to re-examine how you're defining risk and reward.
 

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