We're all wrong - Apparently

[Scripophilist]

I thought that time would be the joker in the pack until someone showed me about variability in time series. That sort of solved that issue.

An interesting point that came out was that Risk, Return and Time are linked.

Lets assume a 15% return, 10% volatility

Scale Probability
1 Year 93%
1 Qtr 77%
1 Month 67%
1 Day 54%
1 Hour 51.3%
1 Min 50.17%
1 Sec 50.02%

So basically the shorter the timescale the more random the price movement. The shorter your horizon the more you can account for price movements as standard variability or put simply "Noise".

My best strategy for the last 14 years has been to sit and wait for companies with strong financials and a dominant market position to slip up or become unfashionable then buy and hold them till the market changes it's mind. That's giving me a great return year in year out.

However, that's dead boring, so I will not stop looking for that undiscovered short term, high return trading strategy!!!

 

[dsmodi]

stevet

something totally separate from this thread - hope that's ok by peeps.

about a year ago, u mentioned u knew someone who was short on the nasdaq since it topped, and they were still short last year. Do u know whether they've closed that trade now....?

cheers

 

[stevet]

been undoing their positions, but under duress, all the "smart" money is piled up in shorts, but the guys in the mutual funds are desperate for their bonuses at the end of the year and they have joe shmoes money to blow way, and they only can only make money going long, so hard to be right againt them and still make money - so give me intra-day trading anyday - then u can just trade the trend with whoever has the most money,as oppoised to who is right