# Random Walks & Onemind



## ducati916 (23 April 2007)

> Ahh but, their methods are beyond science and are unexplainable parts of conciousness that can only be proved by demonstration, and i'll be damned if i am going to demonstrate something that took me 20 years of hard work to discover. But i will use the excuse that i am a forum elder here to answer questions, but only ones where i can quote the same cheesy money management and psychology lines that are in every trading book, blog, website, seminar ect ect..Nothing actually useful will be shared..




It would seem the previous thread was closed.

Therefore, and this is addressed to *Onemind*;

If I demonstrate the egregious thinking behind the *random walk theory* I shall demonstrate it in this manner, and for the following reasons.

The scientific method requires only one example to disprove a theory.
The theory is assumed to be valid if no proofs to the contrary can be demonstrated.

Therefore, if you post your acceptance of the previous statement, I shall provide 2 examples, specific, that disprove the *random walk theory*

If you don't accept the previous statement, then I shall not bother, as it will only lead to further circular argument, and currently I don't have the time.

That is not to say that you cannot challenge, dispute, question the examples, in fact I would expect you to. But it will keep the discussion focused over the short timeframe.

If, after contemplation you come to accept my two examples as disproving the *random walk theory* it will allow you to find not just the two examples I have given, but the hundreds of non-random events that happen everyday within the financial markets.

jog on
d998


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## rub92me (23 April 2007)

Onemind has probably left the building. But I would't mind to see your examples that disprove the random walk theory, accepting your definition of the scientific method.


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## doctorj (23 April 2007)

Onemind is on a holiday, but I'm sure many others would benefit from your examples duc.


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## ducati916 (24 April 2007)

Actually, I received a PM from *onemind*, so I will post the examples after I have my breakfast!

jog on
d998


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## tech/a (24 April 2007)

Why not just talk one on one with Onemind?

Do we really need another thread on Random Walk Theory?
There are about 1 million of them littering cyberspace.


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## ducati916 (24 April 2007)

From the now *banned* *onemind*



> Anyway, I am interested in your evidence even though i cant respond.
> 
> So in the thread just write, "I have become aware that onemind has been banned and cannot reply to this thread so i will post my proof anyway."




I shall lead off with a specific example;

ETF"s are are basket of underlying stocks that are purchased and securitised, and then traded like a stock on the exchange.

An example; DIAMONDS [DIA] is the tracking ETF for the 30 Dow Jones Industrials. This ETF is rebalanced in real-time on a daily basis on the basis of how the constituent stocks are trading, thus an ETF is a derivative product.

The e-mini Futures contract, the YM, tracks also the cash market [or again the constituent stocks]

Thus in effect we have two derivative products tracking the DJI averages.

Everyday there are arbitrage opportunities available to book risk-free profits when prices trade away from relative fair value.

The calculation is;

Futures Fair Value = Index * [1 + Time * Rate] - Dividends

Let's say the Futures are selling at a discount then; Arb's will Buy Futures & Sell; either, all 30 constituent stocks, or the DIA ETF, or some combination thereof.

The result is a return to a relative fair value.

Thus prices within the indices are far from random, they are in point of fact very tightly controlled via arbitrage.

Usually at this point, the dissenting argument revolves around, ahhhhh, but the stocks that underlie are random....

Well no.

Stocks will track their earning power on a *central value* basis, with potentially very wide fluctuations above and below.

These fluctuations are investor/trader reactions to new information, and are partly factual, partly sentiment or psychology.

Market Psychology;
Is not defined as the usual nonsense, greed/fear, but rather the divisions within the professional community.

We have funds divided into;
*Value
Growth
*Momentum
*Arbitrage
*Bankruptcy
*LBO
*Other

All of these strategies have at their core an investment paradigm on how to approach the market. At any given point in time, one strategy may predominate in any given stock. The strategy that predominates will set the trend for that stock.

A trend implies a starting point, and a finishing point. In between, you have volatility, sometimes very high, sometimes low. Thus, if there exists a trend, there is no randomness.

Volatility rising is associated with trend change because you may well have one or more strategies fighting for control of the stock, based on their individual investing/trading paradigm.

However, over long periods, stocks track their earnings, thus non-random, assuming you interpret the information CORRECTLY.

Incorrect assimilation of information will also account for reversals in trend. That is, everyone expects earnings to be weak, and are thus short, earnings are strong, shorts cover.

Business cycles, credit cycles, interest rate cycles, etc are also by their nature non-random. Excesses build-up in the system, and eventually, those excesses must be purged.

The *Timing* can be difficult [very] but again, this is not randomness.

Randomness exists, and it is the future, but randomness creates not further randomness in the markets, but rather *inefficiencies* due to faulty understanding, logic, models, etc.

jog on
d998


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## rub92me (24 April 2007)

tech/a said:


> Why not just talk one on one with Onemind?
> 
> Do we really need another thread on Random Walk Theory?
> There are about 1 million of them littering cyberspace.



Well, maybe more useful then a thread on Trading systems, no? There are about 64.5 million of those about as well according to Google


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## Porky (24 April 2007)

> Business cycles, credit cycles, interest rate cycles, etc are also by their nature non-random.




They are random as far as people trying to predict them are concerned. Lets say that on the fundamental level there are very good reasons why such things occur, you cant conclude its not random because there is not an economist in the world that can predict the next recession accurately ect ect..

Your logic is that because there are reasons things happen the result isnt random but the reasons themselves are random and no one in the world can predict outcomes unless having super computational ability to track every fundamental variable accurately and no one on the planet can do that. Even the best economists in the world still debate what the fundamental reasons even are.

I dont know what onemind will say about this but your trading strategy, although profitable, does not prove the non randomness of the market..


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## Sean K (24 April 2007)

Porky said:


> I dont know what onemind will say about this but your trading strategy....



I think I know what he might say.


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## professor_frink (24 April 2007)

Porky said:


> I dont know what onemind will say about this




Love it!


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## Porky (24 April 2007)

.


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## Kimosabi (24 April 2007)

Well, I think this e-drama can be best summarized by the video below...


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## ducati916 (25 April 2007)

Porky said:


> They are random as far as people trying to predict them are concerned. Lets say that on the fundamental level there are very good reasons why such things occur, you cant conclude its not random because there is not an economist in the world that can predict the next recession accurately ect ect..
> 
> Your logic is that because there are reasons things happen the result isnt random but the reasons themselves are random and no one in the world can predict outcomes unless having super computational ability to track every fundamental variable accurately and no one on the planet can do that. Even the best economists in the world still debate what the fundamental reasons even are.
> 
> I dont know what onemind will say about this but your trading strategy, although profitable, does not prove the non randomness of the market..




Market prices are not random, as demonstrated via the example of arbitrage, viz. the scientific method, one proof of falsity, falsifies the theory.

The two remaining challenges therefore are to demonstrate that the economy and the market are not directly correlated and that in point of fact the data is predictable over longer timeframes. Then, it will be seen that market prices are driven by the previously mentioned factors [strategies + timeframes]

First have a look at these statistics;
http://www.crestmontresearch.com/pdfs/Stock Economy.pdf

Second, the *randomness* of the market is further dispelled via the surprising *regularity* of the following data;
http://www.crestmontresearch.com/pdfs/Stock Yo Yo.pdf

The confusion in relation to randomness has occured due to the fascination with very short time periods and trying to analyse the *noise*

Noise, may very well be random, it is also irrelevent.

jog on
d998


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## pedrochemical (13 April 2009)

The scientific method requires only one example to disprove a theory.
The theory is assumed to be valid if no proofs to the contrary can be demonstrated.


Wow,my mathematician father warned me that economists were worse than physicists with their profligate use of the term proof.
I see why now.
Whilst I agree with the first statement, the second worries me.

So I guess that god exists as I cannot fond a counter example to his existence.
Well that is settled then. Happy easter!


Do you guys really believe something to be true merely because there are no proofs to the contrary? This guy was joking right?

I know this is an  old thread, but that is really scary stuff people....


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## motorway (13 April 2009)

Why The Random Walk Is Mostly Wrong, Most Of The Time

http://clayallen.com/MD_NEWS_V8_I8.pdf


( Statistically )




> It can be demonstrated that the
> random walk is mostly wrong, for most
> stocks, most of the time. A simple review
> of the statistics for a large number of
> stocks makes this conclusion inescapable.



--------------------------------->


> The random walk applies to the movements of no more than one
> third of all stocks at any point in time. The other
> two thirds of all stocks are trending, either up or
> down, and that is true almost all the time.
> ...





motorway


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## pedrochemical (13 April 2009)

Did I miss something?
Maybe the Random Walk theory is correct - maybe it is not.
But the notions of proof to which Ducati916 subscribes are just silly.


I have a question.
Does the proximity in time to the point at which a trend or pattern is observed have a correlation to its predictive power?
In other words, are, for example, double tops and wedges considered more reliable indicators in day trading than they are when used for trading over weekly or monthly timescales?

Should I start a new thread to ask this? I have a bunch more questions to bug you with.

By the way, anybody who calls himself Ducati916 has got to be a basically O.K. kind of a bloke if a little too much of a risk taker.


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## motorway (13 April 2009)

pedrochemical said:


> Did I miss something?
> Maybe the Random Walk theory is correct - maybe it is not.
> But the notions of proof to which Ducati916 subscribes are just silly.
> 
> ...




There are trends at all magnitudes

But a number of the smaller magnitudes have more of a random appearance

( participation / populations of interest )

There is one trend that is primary and this is the trend of manipulation 

This trend has the least appearance of randomness

And rules over all the others. ( smaller  100% )

Think of  a series of coin tosses compared to a series of share fluctuations.
In any time interval there can be many or few tosses/fluctuations

So misunderstand the time element and the true trends are invisible or at least distorted

motorway


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## pedrochemical (13 April 2009)

*trends adn shapes -scaling properties?*

Disregarding randomness, and imagining that I subscribe to technical analysis as a predictive tool, are trends in the more recent shorter term more useful than trends discerned over longer periods?
What I mean is - although line charts exhibit scaling properties (monthly, weekly, daily and intraday charts are indistinguishable without their time and price marked on them) can the same be said of these entities we call trends and shapes. 
So is a double top considered as valid if the peaks of the double top are months apart rather than minutes apart?
Is there a difference to the chartist?


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## motorway (13 April 2009)

*Re: trends adn shapes -scaling properties?*



pedrochemical said:


> Disregarding randomness, and imagining that I subscribe to technical analysis as a predictive tool, are trends in the more recent shorter term more useful than trends discerned over longer periods?
> What I mean is - although line charts exhibit scaling properties (monthly, weekly, daily and intraday charts are indistinguishable without their time and price marked on them) can the same be said of these entities we call trends and shapes.
> So is a double top considered as valid if the peaks of the double top are months apart rather than minutes apart?
> Is there a difference to the chartist?




If the primary trend that matters is the trend of manipulation

The primary task becomes one of acting in harmony..

double tops / wedges , double bottoms are all just static snapshots
and are not what are really important



> The changes in stock prices, day-to-day, are not the result of some physical or electrical system but are due to the actions of human beings in buying and selling stocks.
> 
> These changes may be due to many factors, some fundamental but also emotional and psychological factors as well. The  analyst accepts the fact that he may not be able to determine precisely which factors are in control at any point in time - he does not predict the trend as much as he just follows it.
> 
> He follows the trend so he will know when it changes direction. Knowing when the trend changes direction is the next best thing to an accurate prediction of the trend.







> The lore of Wall Street indicates that  charting evolved as a means for outside investors to keep track of a stock that was being manipulated by an inside pool. It was very important for the outside investor to know when the manipulation was finished and the stock had started down. When the trend stopped, he knew the inside manipulation was over.




The opposite of Random is Manipulated

The factors of manipulation are multiple

But

To create order ( trend ) takes work...

It takes work done--Work done shows up in how a stock fluctuates. This how being  different to how a Coin fluctuates ( It is this difference and when it happens that a chart must reveal )

Work done is Energy transferred

Energy transferred creates High and Low

And along the way many patterns 
that might or might not  predict anything at all..

Think of Weather Sytems as an example

High and Low create potential

The patterns that matter are generic and few

When a stock ( just like a pendulum ) fluctuates
Work is being done on or by .Energy is being transferred and High and Low are being created.

Another name for High and Low is before and after

motorway


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## motorway (13 April 2009)

> In studying the movements of stocks, it is well to have in mind the old saying,
> "Stocks *must *fluctuate."




*MUST*

Why ?

For the whole why of markets.

To transfer RISK and REWARD

There is nothing that is random about such transfer

It is why some end up with all the reward and others all the risk

Stocks fluctuate to create trends such that Tops and Bottoms  form and transfer can be facilitated.


motorway


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## ducati916 (14 April 2009)

pedrochemical said:


> The scientific method requires only one example to disprove a theory.
> The theory is assumed to be valid if no proofs to the contrary can be demonstrated.
> 
> 
> ...




*pedro*

The theory promulgated is of course from Karl Popper, and is commonly referred to as *falsification*

I see that you agree with the first statement. The second statement is really nothing more than an inversion of the first statement. If, I can find no examples [evidence] to disprove the hypothesis, then, logically, by definition, it is true.

Your example displays clearly your muddled thinking on the topic. Let's restate the example correctly, sticking with your hypothesis.



> So I guess that god exists as I cannot fond a counter example to his existence.





Simply invert your hypothesis:

H1: God does not exist.

Now, simply find one example of evidence, that is not based on hearsay, faith, that demonstrates God's existence, and God is proven to exist.

Of course the argument that rages in theological circles and beyond, is, does faith, constitute evidence?

jog on
duc


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## ducati916 (14 April 2009)

pedrochemical said:


> Did I miss something?
> Maybe the Random Walk theory is correct - maybe it is not.
> But the notions of proof to which Ducati916 subscribes are just silly.
> 
> ...




That a trend exists, falsifies the theory of a random walk. A random walk is based mathematically upon independence of the data. Stock prices are not independent, ergo, stock prices are not a random walk.

Nothing more really need be added. Timeframes are simply a red herring to the central question; viz. random walks.

jog on
duc


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## ducati916 (14 April 2009)

*Re: trends adn shapes -scaling properties?*



pedrochemical said:


> Disregarding randomness, and imagining that I subscribe to technical analysis as a predictive tool, are trends in the more recent shorter term more useful than trends discerned over longer periods?
> 
> What I mean is - although line charts exhibit scaling properties (monthly, weekly, daily and intraday charts are indistinguishable without their time and price marked on them) can the same be said of these entities we call trends and shapes.
> 
> ...




Agreed charts are fractal in appearance.

Yes, there are very real potential differences of the stock concerned. Take a simple example. The common stock traded at $40/share on April 2008, with 1,000,000 shares outstanding, traded down to $10/share, and while trading at that price, purchased back 500,000 shares, so that now there are 500,000 shares outstanding.

Thus, at $40 share, assuming the stock trades back up, we have half the capitalization that we had previously...a significant difference, and depending on earnings, potentially a far cheaper value on the stock.

Is there a difference to the chartist...to a good one, who is cognizent of the difference, yes. To the poorly informed, none whatsoever.

jog on
duc


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## pedrochemical (21 April 2009)

Is there a difference to the chartist...to a good one, who is cognizent of the difference, yes. To the poorly informed, none whatsoever.

This is more what I was getting at.

Now don't laugh, but I have a lot of data and am in the process of taking a Poincare Section.
My computer is not fast enough, however, to draw the pretty pictures.
The progression through phase space (vector field style) of what I am seeing is what I was expecting to see. This makes me nervous as an experimenter, but even though the numbers are as yet muddy, I hope to see the difference between randomly generated sequences and historic sequences.

I shall let y'all know what happens.
Pretty old school maths but applied like I am trying it - could be interesting if not novel.

Thanks for the input.


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## pedrochemical (21 April 2009)

As for Popper - I could imagine him saying that if a counter example does not exist, the theorem becomes a proof.
But we seem to be saying here is that if we "can't find one yet" the theorem is a proof - for me it remains a conjecture/hypothesis.

Have I missed something?


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## pedrochemical (21 April 2009)

ducati916 said:


> That a trend exists, falsifies the theory of a random walk. A random walk is based mathematically upon independence of the data. Stock prices are not independent, ergo, stock prices are not a random walk.
> 
> Nothing more really need be added. Timeframes are simply a red herring to the central question; viz. random walks.
> 
> ...




Not so sure - according to this - 

https://www.aussiestockforums.com/forums/showthread.php?t=9680

A randomly generated chart has trends too - "tradeable" trends at that, if you believe in Chartism.

As it happens I think I agree with you in principle though.

Also, time-frame in regards to psychology could be important in my view. A human is known to flinch in the short term and act more perspicaciously over longer time-frames. 

When we see a wasp out of the corner of our eye we involuntarily move rapidly away from it. Once we are aware of the threat and have time to consider our actions we swat it. (Or shoo it out of the door in my mum's case)


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## ducati916 (22 April 2009)

*pedrochemical*

It seems that you are looking into ergodic/dynamical systems, and statistical mechanics.

Without going technical, probability theory & Benoit Mandelbrot, with his fractal mathematics constitute the body of work that have been applied to stockmarkets.

Most experienced chartists will pick the stockmarket data over random generations. There are a number of tests available that you can take. Do I buy into charts? Yes, I do, but not in the way that technical analysts approach the problem.

As you progress, there will be one major problem to overcome. If you can solve it, then, you'll make some serious money...if not, well there you go. Timeframes and psychology are central to the problem, and to the solution, therefore no argument from me.

jog on
duc


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## pedrochemical (22 April 2009)

What I fear is that I have again come across something deterministic but non-computable.
This universe sucks sometimes!!


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## Trembling Hand (22 April 2009)

pedrochemical said:


> What I fear is that I have again come across something deterministic but non-computable.
> This universe sucks sometimes!!




If you are looking for a game that will enable you to be proven right, for whatever reason, there is no more dangerous game than the markets.


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## motorway (22 April 2009)

ducati916 said:


> *pedrochemical*
> 
> It seems that you are looking into ergodic/dynamical systems, and statistical mechanics.
> 
> ...




And What does mandelbrot say about how to treat time and time frames ?


On Ergodic

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=636484




> *Living in a non-ergodic world
> *
> once ergodicity is broken, we
> are guaranteed at least two different estimates for the returns, that is,
> ...




motorway


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## pedrochemical (22 April 2009)

Trembling Hand said:


> If you are looking for a game that will enable you to be proven right, for whatever reason, there is no more dangerous game than the markets.





I do not want to be proved right or wrong - I just want to discover some stuff and save some of my more gullible friends from seeing stuff and believing in stuff that isn't actually there.
I would never presume to be able to apply what I am talking about to actual trading - I am not that arrogant or well funded or clever and I only trade with my money- it also keeps the mind ticking over while I 'slowly bleed to death' waiting until the next great disaster day to fill up on. 
I am sure we can all agree - in terms of making cash from the markets, 2008 was the best year in living memory. So why, then, have I a lot of friends who lost money in the largest year on record. I want to know (and I want them to know) why they did lose when they followed conventional wisdom.
I have my suspicions and I am working at discovering if I am right.

Anyway, at the moment I think it makes sense to stay liquid.


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## Trembling Hand (22 April 2009)

pedrochemical said:


> I am sure we can all agree - in terms of making cash from the markets, 2008 was the best year in living memory. So why, then, have I a lot of friends who lost money in the largest year on record. I want to know (and I want them to know) why they did lose when *they followed conventional wisdom.
> I have my suspicions and I am working at discovering if I am right.*



 Yes agree but could you explain more on the underlined please?



pedrochemical said:


> Anyway, at the moment I think it makes sense to stay liquid.




Doesn't it always


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## pedrochemical (22 April 2009)

By conventional wisdom, I mean they traded trends as they would when they were making money. Then they started losing money - on stronger trends.
That seems crazy to me.

I worry that the reason they were making money in 2005-2007 was not because their chartist convictions were correct - this is what I want to confirm somehow - hence my pestering of the board for opinions.

I do not think it was entirely arrogance or gullibility either. I think *maybe* the notion that we can predict the future was fundamentally flawed. 
It is the *maybe* that I want to turn into a *yes* or *no* or at least a *probably* or *probably not*

In some cases I can imagine people believe the general trend of a market is up as this is what they see day in day out for years. Perhaps they are naturally more reluctant to exploit the bear market - perhaps this a human trait? 
But a lot of non-stupid traders stopped making money too - so that ain't it.

I do not even beleive in certain cases (where they were used) their 'bots were incorrectly configured. 
They were not caught out by a tidal wave - I think that maybe their education told them that what happened was so unlikely that they could not see it when it was happening. Who knows?

But I am getting off the point here.
I want to know if we can predict the future - and get it right.
And if we can/can't - then why?

This is not a zero sum game so I am unhappy when people lose money unnecessarily.


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## motorway (22 April 2009)

pedrochemical said:


> I want to know if we can predict the future - and get it right.




FEEDFORWARD

The fact you make a prediction , and (at least someone ) acts on it 
( important )

That  changes the Future

Multiply this by all the people predicting something and acting on it.
And you have to input all these into your model

and then input that into your model and so on like a hall of mirrors to infinity.

NOW that was why all the people blew up..

BUT if can predict something and very few can act on it ( or would act on it )
The you have an opportunity..

You loan actions will not at first be disruptive..

Such opportunities arise eg in a bear mkt

so many know the market will go up again
But they have NO MONEY
or worse are being sold out

The guy that lost the Kingdom for want of a horse
He knew where and what he should be doing

But constraints meant the difference

The difference between feedforward and feedback..

From a distance I can see what shopping cue is the shortest
But acting on that information means that when I arrive it has become the longest cue..

We are the thing we are trying to predict

Not like the behaviour of rabbits or microbes or gasses ,coin tossing or roulette wheels

motorway


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## Cartman (22 April 2009)

pedrochemical said:


> By conventional wisdom, I mean they traded trends as they would when they were making money. Then they started *losing money - on stronger trends*.
> That seems crazy to me.




interesting thread

Pedro ---- the reason why your mates started losing is due to them not recognising the trend was changing, and adapting to it -----

it was their perception which was flawed --- they were seeing what they wanted to see; not what was actually happening, hence holding onto bad positions for too long ---  their positions ended up being a bi-product of basic fear and greed --- it just happens unfortunately 



pedrochemical said:


> I want to know if we can predict the future - and get it right.
> And if we can/can't - then why?
> 
> This is not a zero sum game so I am unhappy when people lose money unnecessarily.




depends --  how far into the future do you want to be able to predict?? 

and really how beneficial would it be to know that XYZ will be $X in december 2010 if in the meantime its gona have a trading range of 2000 pips/ticks/whatever  ---- 
*if you want to use strong binoculars, your probably gona need deep pockets* 

i dont like seeing people lose either, but it is the nature of the game --- if your mates are smart they should learn a lot from their losses and hopefully come back stronger next time. Cheers.


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## ducati916 (23 April 2009)

*motorway*

Ergodic theory is a branch of mathematics that studies dynamical systems with an invariant measure. In mathematics, an invariant measure is a measure that is preserved by some function. The mathematical concept of a function expresses dependence between two quantities, one of which is known and the other which is produced.

Ergodic systems, statistically speaking, [the system] that evolves for a long time "forgets" its initial state.

Clearly, financial markets do not conform to this theory. Our _function_ is the two variables, time [known] and price [unknown/future] which qualifies the financial markets, as time and price are dependent. However, Markets, tend, to _mean revert_ thus invalidating a definition of an ergodic system.

I looked at your link, but fail to ascertain the point you are making.

*pedro*



> By conventional wisdom, I mean they traded trends as they would when they were making money. Then they started losing money - on stronger trends.
> That seems crazy to me.
> 
> I worry that the reason they were making money in 2005-2007 was not because their chartist convictions were correct - this is what I want to confirm somehow - hence my pestering of the board for opinions.




If you look at the S&P500 chart, 2005-2007 was a period of the lowest volatility on record. Buy & Hold, was the correct strategy for that time period. Contrast the current period, the volatility increased to all time record highs for sustained volatility.

While the _trend_ was sustained [in hindsight] the ability to _hold_ became very difficult. Thus, making money became much harder.

jog on
duc


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## motorway (23 April 2009)

> Clearly, financial markets do not conform to this theory.




That was the point .

I misunderstood you

I thought you were implying the opposite. 

motorway


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## tech/a (23 April 2009)

pedrochemical said:


> Is there a difference to the chartist...to a good one, who is cognizent of the difference, yes. To the poorly informed, none whatsoever.
> 
> This is more what I was getting at.
> 
> ...





My son is a Doctor of Physics.
He hasnt the time to do any modelling on the markets currently.
However as a long term Chartist myself he has watched and taken part in some of my trading.

When asked how he feels about mathamatical modelling with regard to trading his reply was un expected.

"I can return you figures in any format you want---to support an arguement or not."


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## Trembling Hand (23 April 2009)

tech/a said:


> "I can return you figures in any format you want---to support an arguement or not."




Exactly. And to a trader that is of absolutely no use. We will just  and move onto making money from the random moves


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## motorway (23 April 2009)

So where does the shopping cue problem lead to..

The more others are _acting _on the same information to predict
and inform ...

Even if they are using complicated indicators
moving average. oscillators. bands . Gann  EW etc

The patterns will break down just at the point where they start working well
( you end up at the end of the day in the long cue )


They break down Into dampening or expanding congestion patterns 

With Cobweb ( from original  Hog Cycle pattern ) dynamics .



What is the solution ???

One is to be quick , very quick .

The other is to focus on the key characteristic that most/all the mathematical models overlook..

One person walking in towards the cues
Knows something everybody does not

He has been told that a cue over the far side will be opening in the next few minutes.. And he positions himself to take advantage..

In the markets positioning oneself means buying or selling FIRST

ie:  Accumulation or Distribution



motorway


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