Why do you think you can make money trading?

arabianights

Legendary member
6,725 1,377
#1
On short term timescales, the markets can be, essentially, considered zero sum. Some are precisely zero sum (most derivatives are, although it has to be noted that those that derivive from an underlying non zero sum market are not zero sum... or more precisely they are but there is a mean win of the risk free return built into one direction [and the converse] but you can consider them zero sum as with all other markets for short timescales).

So why do you think you can make money from these zero sum games - particularly when you are playing with other participants who can? I will explain why I know I can in a few days, but I make this post with the aim of provoking thought, so do go on and post... :)
 

zupcon

Experienced member
1,162 322
#5
because of kurtosis
 

donaldduke

Experienced member
1,665 251
#6
Short term trading is zero sum but the markets don’t appear to be completely efficient.

Those who can make money have not saturated the market over all time frames.

Still a place for me at the trough it would seem.
 

montmorencyt2w

Senior member
2,620 294
#8
I can't understand your first paragraph at all.

I can just about understand your second, but it doesn't say a lot.


Perhaps I should stop trying to read forums (fora?) while under the affluence of incahol.


It's not a zero-sum game if you have even the slightest idea of what you are doing.

This is my last territorial claim in this particular region of "that faraway country of which we know little", which sometimes goes by the name of Trade 2 Win. (Win? - he must be joking ...)
 

Trader333

Moderator
8,458 874
#9
Good question, I guess my answer would be having an edge that others either don't know about, don't understand or don't use.


Paul
 

Trader333

Moderator
8,458 874
#10
It's not a zero-sum game if you have even the slightest idea of what you are doing.
It is not meant in the context of an single individual, it is meant in the context of all those participating.


Paul
 

blancspa

Established member
814 35
#11
perhaps you re refering to having an edge?
either it is a strategy , methodology , system , luck , money , technology ...?
I starting to figure out that your trading style exatlcy mirrors the way you live your life, and the personality you hold. To change it, extremely diffcult but I heard - possible.
If thats true, that means that life is a zero-sum game too, but here you won`t know if you re winner or loser until the very end.
 

TraderNumber7

Well-known member
376 45
#13
Good question, I guess my answer would be having an edge that others either don't know about, don't understand or don't use.


Paul
Bingo! You win the little Pink Elephant sitting in the middle of the room that everybody wants to talk about.

I used to come on forums such as this (in fact, this was one of them) and talk about the earlier developments of my Edge. I don't do that anymore. Not necessarily because any Market Maker, FCM, Broker or Bank can target and eliminate my edge, but because it is very possible for Regulators to Regulate My Edge out of existence, or for my Intermediary, to Policy My Edge out of existence - thus, I don't talk with specifics about my Edge.

However, I will say this about Edges in general:

1) The best repeat themselves on a very high probability basis.

2) The best are often times the most simplest of concepts.

3) The best will often times (but not always) work in multiple time-frames or multiple bars of data.

4) The best will work consistently under any and all market conditions.

5) And, most importantly, no other market player, either buy side, sell side or execution side, will be able to target your Edge for destruction.

Those are the five (5) most critical component factors of a good Edge, regardless of the financial market you might trade.

One thing I will say about my Edge is this: It is Global in nature and Extensible at its core. Its extensibility throughout the world virtually guarantees break-even 99.99% of the time. The rest of the win ratio comes in between 90% to 62% of the time. Sum total: A net/net zero lose proposition approximately 98% of the time and I'll take that Edge to the bank.....every chance I get.

All that, with approximately 30+% of the Edges components losing money. Not a bad days piece of work down at the old wood mill, if you can get it.

TradSMART. :smart:
 

Benton D Struckcheon

Well-known member
251 15
#15
Well, speaking just for the world of options, there is a pool of money available from those who trade them strictly for hedging purposes. The intent in a hedge isn't to make money, but to minimize loss.
That means that if you're in it to actually make money, you can draw from that pool.
Similarly with fx, although having worked for a global commercial bank, who are the folks taking the other side of that trade, I do wonder about the sanity of retail fx traders. OTOH, I'm sure the Chicago options mm's wonder about the sanity of folks like me...
 

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