The difference between mech and disc has always interested me. Good thread folks.
All just my opinion...
A discretionary trader ought to trade mechanically, with a rigid set of basic risk/money management rules underlying their strategy at all time. However the level of complexity at which a DT processes dynamic market information is simply too high to be coded into a consistent rule based system. The variables (and their relative significance) are constantly in flux, with the market changing its character by the minute, hour, day and week.
For instance: A mechanical system says 'always buy when a 5 min bar breaks out of x channel', but, unlike the DT, it would be unlikely to spot a weekly trendline looming above the BO zone, one that would almost certainly negate the signal and spare the account from a loss. A DT operates mechanically but is paid a premium to sift variables in a superior manner to a simple system. A DT may trade nothing but 1-2-3s, but (s)he has to be there to separate the iffy from the high probability ones, to set the stop and target according to "the market of the moment", to adjust these in real time as the action unfolds if necessary, to be on the button if a bit of unexpected news comes out etc.
I would imagine that even a gloriously specified neural net would have trouble doing these tasks.
---
On the subject of money:
Try removing the profit and loss column from your trading platform and just look at the instrument's price. Be aware, obviously, if you are already long, short or flat. Continually ask yourself "Is this a buy, a sell or a sit on hands price?" as the orders go through, and act accordingly without question.
Ignore your entry price entirely, just concentrate on the current one. If the current is a "sell" in yr opinion then cover any longs you may have and go short. Despite my oversimplification, I'm sure you get the idea, which is to trade the game while removing monetary aspects as much as possible. The result may surprise you; it did me and I haven't yet reinstated the P&L column. It is amazing how differently one can trade without a plus or minus $800 staring one in the face to stir up the old emotions.
Of course we are interested in money to the extent that we need some to exist. But I would rank the puzzle (which I believe is never truly solved even by the most ardent, talented intellectual mind, because some of the rules must keep changing, novel situations must continually arise, and the trader must evolve or die) the autonomy and the personal satisfaction of succeeding in one of the hardest professions going in a far higher position. I am lucky, perhaps: I look forward to every trading day with a passion, an unflinching curiosity as to what she'll chuck at me today and how I'll cope with it. This is true even after the worst year in my trading career, during which I have suffered a meagre income mingled with crippling self doubt and oft considered packing it in for good. But the passion has always won out in the end. As long as I can pay the bills I don't care what it takes.
I agree that just trading one or two purely mechanical systems day on day out is not particularly mentally stimulating and it might well be tedious to do nothing but daily doggedly execute their signals for a score or more years. (I'm not, incidentally, claiming it's easy or in any way demeaning or inferior to do this - many fall way before this fence.) But remember that we are human and we can do so much more. So what if we robotically spend one minute a day actually buying or selling? That leaves another 7 hours and 59 minutes of a typical working day to do something interesting. There is system tweaking, adapatation, imporvement to think about, books to read, walks to be taken, novel pursuits to try, discussions to be had. Mental stimulation is only absent if you decide or force it to be so. The boundary between work and play is not a definite one; indeed in my life I now have absolutely no idea where it lies and that pleases me, though I accept that attitude is not for everyone. Whether reading about probability or learning a new bouldering move or scrutinising a chart to see where the optimum entry is that will lose me the most amount of money
-) everything I do seems interconnected in some way and they all contribute towards a more fruitful life. Anyway I witter and start to sound like a pretentious fool. Bring on the next twenty years!
