Grey1 said:
FRUGI,
Good question .. I have no idea how one can be profitable with out high degree of automation as we are all human and we have the same two hands /legs and our behaviour is nearly all the same. We all cut the winners and let the losses to run and unless this is not taken over with an automated methodology the final result will be a total LOSS of Entire CAPITAL ..
Thanks for your interesting reply Grey. I think perhaps this view is a touch pessimistic though. Sure, we've probably all at some point (especially at the start of our careers) done these dirty deeds, but after a while one trains the mind to not fall foul of emotions and their predictable, destructive effects. Indeed one learns to capitalise on those of others. To automate is, to me and with regard to myself only of course, almost a tacit admission of weakness: "I will never be able to switch emotions off therefore I will delegate my decisions to something that totally lacks them". The trouble is the delegate can only accept simple..ish instructions and is unable to adapt in a complex manner to new conditions and then act appropriately. This of course may change if neural nets etc. up their game. The other trouble is that doing this leaves rather little for the human to do or think about, at least until he deigns to change the instructions, and I find that a little disheartening.
Trading is not tickling competition ..
Quote of the year, I love it. A brutal truth delivered with muchos humour.
it is serious competition amongst highly automated institutional traders with tons of software at their disposal.
Serious it certainly is. But does this software make them better traders? It allows them to quickly exploit certain statistical opportunities given their capital base, connection speed, knowledge of order flow etc., but imho many opportunites for the logical thinker are still left, in spite of them, perhaps even because of them.
And is the main thrust of the competition truly amongst them when there is a supply of naive fresh meat entering the market in a contunuous stream from which they can feed more easily? I don't know the percentages of different market groups but I thought the pros mainly take money off the idiots while the crowd breakeven, make a little, or lose a little. The crowd would no doubt include some institutional traders as they are not all making 100s of % return pa.
Adding or dumping positions objectively and correctly should be with out the doubt a very important aspect of any trader's strategy
Agreed.
and unless it is automated it becomes impossible to achieve intra day .
For some strategies such as lightning fast arbs, undoubtedly. But there is still room for the non-automated trader to exercise patience and discipline and be able to take, say, half the daily range, by entering and dumping manually, without necessarily falling foul of the evil emotion demon. A fast front end with the "widen stop" button disabled helps, mind.
Trading is simple.. trust me.. it the human emotion which ruins every thing
In my experience, it certainly has a nasty history of doing that.
But it can imho be conquered, or at least confined to one's non-trading persona, and then the rational + subconscious are free to act in harmony, as decisively as a machine, but with a far wider range of outputs and dramatically improved contextual processing power.
I do not mean to sound aggressive here at all, though I probably do. I'm just curious and fascinated by the wildly differing M.Os. of all successful traders. Your insitutional perspective is extremely valuable and rather worrying. Program trading rises monthly; black boxes and algorithms become ever more complicated as processing power rises exponentially; the machines really do seem to be taking over and this must be acknowledged and accounted for, especially given the capital behind them. But I still don't believe they're necessarily going to crush an uncompromised autonomous Mark Three human brain.
In fact we should be able to track the ones with sufficiently large footprints, run round them (or join them), avoid their big feet and occasionally jab them or their victims with little forks at appropriate moments too, if we have the skill. I don't, but I'm working on it.
Still, I advance no original arguments here and I shouldn't disrupt the thread any longer with idealistic rambling.
