Posted by tsurplus on 15th of Jan 2016 at 11:14 am
Thanks for the elaboration. I always felt that if you want to
play the system, you put your trust in it, otherwise, dont play. If
you are only 50% sure of the system, well, then play only 50% of
what you intended to trade! Of course, that does not mean we should
not ask questions. For example if I am curious about certain aspect
of the trade, I may ask questions.
yep agree, since you don't know what the system rules are, it
makes it sort of a black box and so it makes sense you will ask
questions and should, and that can also be the source of some trust
issues since you don't know all the rules of the system. I do
try to give some info about trade types as you've seen, such as the
last short on the ES system, based on a 60 length Stochastic
reversing off 80% and other things. Since you don't know all
the rules - there will always be some worry or trust issues I
suppose on your guys part. But again one also has to decide
if they are gonna trade the system or not, and if they do, I think
enough time has to be given, can't over analyze one trade or 2
trades, gotta let it run for a while. And could the system
stop working for a time, sure. But also I think one needs to
start small so that when they let it run, it will mitigate the
emotions, over time if profits are made then allocations can be
increased.
The guys who see a system and notice that it makes 30% a year
and say to themselves, man I if I trade my whole account and double
it on using SSO and SDS, I can make 60% a year, and in no time I'll
be retiring baby! they end up failing because of emotions and draw
downs on losing trades. A system trade that loses 5%, which
is small, could be 10% or 20% if one used a leveraged ETF and
margin, and so someone who is trading a reasonable % of his/her
capital would be just fine with the 5% losing trade, whereas the
over leveraged aggressive guy might not.
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thanks and my opinion
My system rant, statistics, psychology, captial management etc
Posted by tsurplus on 15th of Jan 2016 at 11:14 am
Thanks for the elaboration. I always felt that if you want to play the system, you put your trust in it, otherwise, dont play. If you are only 50% sure of the system, well, then play only 50% of what you intended to trade! Of course, that does not mean we should not ask questions. For example if I am curious about certain aspect of the trade, I may ask questions.
yep agree, since you don't
Posted by matt on 15th of Jan 2016 at 11:22 am
yep agree, since you don't know what the system rules are, it makes it sort of a black box and so it makes sense you will ask questions and should, and that can also be the source of some trust issues since you don't know all the rules of the system. I do try to give some info about trade types as you've seen, such as the last short on the ES system, based on a 60 length Stochastic reversing off 80% and other things. Since you don't know all the rules - there will always be some worry or trust issues I suppose on your guys part. But again one also has to decide if they are gonna trade the system or not, and if they do, I think enough time has to be given, can't over analyze one trade or 2 trades, gotta let it run for a while. And could the system stop working for a time, sure. But also I think one needs to start small so that when they let it run, it will mitigate the emotions, over time if profits are made then allocations can be increased.
The guys who see a system and notice that it makes 30% a year and say to themselves, man I if I trade my whole account and double it on using SSO and SDS, I can make 60% a year, and in no time I'll be retiring baby! they end up failing because of emotions and draw downs on losing trades. A system trade that loses 5%, which is small, could be 10% or 20% if one used a leveraged ETF and margin, and so someone who is trading a reasonable % of his/her capital would be just fine with the 5% losing trade, whereas the over leveraged aggressive guy might not.