# Beginner's Trading Blog



## kid hustlr

Introduction:

Hi All,

I've been a member of this forum for the best part of a year. I've learned a great deal by reading through a number of the beginner threads as well as a number of others. I’ve decided to have a proper go at trading as it’s something I’m really interested in and I feel it would suit me well. I’ve read several books including Murphy’s ‘Technical Analysis of the Financial Markets’ and Lefevre’s book about bucket shops and his trading journey. Both were very interesting. 

Whilst I’ve learnt a huge amount over the past 12 months (about investing/trading/life etc) it’s still obvious I have a great deal to learn before putting any money on the table and as such I’m going to paper trade for a period of time to let me develop my skills and see if this is something I’m any good at. I have an interactive brokers account with a small amount of funds in their and as such I set up a paper trading account.

I think the paper trading account starts you with 1mil US but I’m just going to assume I only started with 25k (AUD), that way I can measure the influence of brokerage and the whole trading system is more realistic. I might even message interactive brokers and ask if they can reduce my balance to 25k (paper money) now I think about it.

Plan:
I work full time during the week (generally 50 hours or so) so day trading is not for me, my plan is to take medium term positions, perhaps anything from 1 week to 3 months or more depending on the goal of the trade and the market movements. Ultimately I’m just looking to find what works best for me. I’m just looking to make simple trades (no derivatives etc.) and I’m interested in trying a whole bunch of different techniques but ultimately starting simple and going from there. I’m very interested in pairs trading however so that will definitely be something I explore at some stage.
I’m not sure how often I will update this blog. I’m quite busy in life at the moment, but I am looking to take this pretty seriously as I truly believe I want to be successful at this.

I’d love for some of the more senior members to chime in every now and then and give me their thoughts but the ultimate reason for keeping this blog is so that I keep focused on how I’m going. Any advice I pick up along the way is definitely an added bonus.

With regards to specific trading plans I’m going to start pretty simple, mainly focus on price, volume, and a couple of simple indicators such as a moving average and RSI and then look to explore from there. I’ll mainly look to trade the ASX200 to begin with.

As I said I’ll use interactive brokers as my trading platform and I think I’ll use Yahoo finance for my charting software as it seems pretty decent for free software, that said if anyone has any suggestions on a better chart program let me know. I have live data at work if needed however given that I’m not looking to day trade I don’t think live data is essential anyway. My plan is to study charts/trading options after work hours anyway.

I think that covers everything, I’m going to do some serious research over the next week or so and hopefully find some trading opportunities I like.


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## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> As I said I’ll use interactive brokers as my trading platform and I think I’ll use Yahoo finance for my charting software as it seems pretty decent for free software, that said if anyone has any suggestions on a better chart program let me know. I have live data at work if needed however given that I’m not looking to day trade I don’t think live data is essential anyway. My plan is to study charts/trading options after work hours anyway.




If you are going to trade using TA as your tool I would highly recommend you start with system testing. its all too easy to spend weeks, months, years, kidding yourself you are learning to trade. But after you spend some time looking at what "works" in a system you may save yourself years.

You may also find out what incorrect with this statement,



kid hustlr said:


> my plan is to take medium term positions, perhaps anything from 1 week to 3 months or more depending on the goal of the trade and the market movements. Ultimately I’m just looking to find what works best for me.




Anyone?


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## Trembling Hand

*Re: Beginner's Blog*

Just on programs for beginners there are a few ones out there that have free data and free to use with pretty powerful system design ability without going into learn a program language. yahoo charts would not be one of them.

Will follow up on this at a later time but for now its sake'O'Clock.


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## Lone Wolf

*Re: Beginner's Blog*

I'm still in the learning phase, have been for far too long. Why? Mostly because I have a full time job that for a long time ate up about 50-60 hours a week. By the time I get home and do the chores, it's getting late and I'm tired and blah blah... However, this is really just an excuse. I didn't previously make the time. You can always make the time if you want it enough.

So my first suggestion would be, don't drift along doing a bit here and there. Decide if you want to do this and understand how much time you need to put into it. Then either do it, or don't. Trading should be treated as a business. A business requires your full attention. It might not require your full time, but certainly your full attention.

It's encouraging to see that you want to start on paper trading. Also that you want to use the same amount of paper money as what you really have. Treat it seriously. Some say that paper trading is a waste of time because it's just not the same as real money. Sure, but if you can't succeed on paper then you certainly won't succeed with real money.

When starting you need to try things to know if they work or not. But don't spend your whole life changing strategies trying to find what's best. That's my second mistake, if you keep rotating between a bunch of different methods you risk never getting good at any of them. The average person tends to lose. You don't want to be average at many things, you want to be great at one thing.

TH's suggestion of system testing is good. Amibroker is a cheap (not free) charting package that allows pretty good system backtesting. There are many others of course, but I think Amibroker is the cheapest one than can backtest easily.

The drawback of paper trading a strategy to see whether or not it works is that you need to do many, many trades before you can get a clear picture of what works and what doesn't. If you are holding for 1 week to 3 months as you say then you'll spend a lifetime paper trading a strategy. Especially if you do it in your spare time when not busy, and with a 25K account (limited capital means fewer trades). That's where backtesting comes in. You can't backtest discretionary trading though, that requires experience. 




kid hustlr said:


> my plan is to take medium term positions, perhaps anything from 1 week to 3 months or more depending on the goal of the trade and the market movements. Ultimately I’m just looking to find what works best for me.




I'm not exactly sure what TH dislikes about this statement. Might be the plan to paper trade long term. Might be "to find what works best for me". Just find what works and do that, don't be on the constant search for the holy grail.  

Sorry if I sound short (even though the post is long), I don't mean to be, I'm just late to see a movie. 

Also, remember I'm a beginner too, so my opinion is worth what I charge. Just pointing out some of my own mistakes. But one good thing around here is that people will quickley point out if someone's talking crap.


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## kid hustlr

*Re: Beginner's Blog*

I'm already glad I started this blog.

TH,

I appreciate your input, and please continue to critique/critize. Could you go into a little more detail about system testing/back testing and what that involves? Also please do go into detail about programs for beginners. Hope the sake went down well.

LW,

Perhaps you could start a blog also? I feel like I might be able to learn a great deal. As far as tiem is concerned, I'm not looking to set the trading world on fire overnight. I want to be succesful and I recognise it's going to take time. I'm simply trying to be realistic, currently I'm looking for a place to live, working 50 hours a week and attempting to learn to trade so I'm just noting that I think this will be a slow process. That doesn't mean I'm not focused on my goals though.

All,

This is a good thread and something I should keep an eye on:

https://www.aussiestockforums.com/forums/showthread.php?t=24308&page=2

I think I underestimated the importance of using good software. Yahoo finance provides a decent charting software (not great, only decent) but I need to keep an excel file and record all my thoughts and notes about each chart that I look at. From what I gather there are a lot of programs out there which will let me 'test' my trades quickly as well as set up alerts and save charts with great efficiency. 

Finding good software and putting good systems in place is my number one goal right now.


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## skc

*Re: Beginner's Blog*

Incredible charts is one option for something free and simple.

When I first started trading I subscribed to Nick Radge's service (I think you can do it monthly if not a free trial). Although I've moved on substantially from what he does, I found his service to be quite valuable for a newbie.

Not everyone here is a supporter of his trading method and analysis, but I think most here will agree that he's a real practitioner who conveys very sensible messages in terms of risk management and approach to trading.

I have no idea whether he's profitable in the current market - but hopefully what you are learning from him is not his method per se (which is trend-following, micro pattern recognition) but something more fundamental than that. Once you've learned enough to disagree with him or see things differently for yourself, you will be well on your way to enter the beginner status (as opposed to a status I called complete ignorance). 

Good luck.


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## Lone Wolf

*Re: Beginner's Blog*



kid hustlr said:


> LW,
> 
> Perhaps you could start a blog also?




Maybe I'll create a blog someday. People can have a good laugh and use me as a contrarian indicator.  But as you can probably tell I tend to get carried away when I start writing. Right now I need to focus more on actually doing things rather than talking about doing things. So for me a blog would be more of a distraction than anything. But once I have a more solid grounding, it'd be good to get feedback from others.

Also, I said you can't backtest a discretionary trading system. That's not quite right. With a system based on solid rules you can code it up, then with the click of a button you can test that system over hundreds of charts. Change one of the variables, run that same test again and in a matter of seconds you can compare the effect of that change. You can even perform Monte Carlo analysis on the system to see the thousands of different portfolios that are possible even when using the same fixed rules system - You can't take every trading opportunity your system presents to you. So your choice of which opportunity to take will affect the end result.

With a discretionary system you can still backtest it. But you need to do so manually. Which is obviously much slower. So if you were using a fixed rule system, then don't trade it manually, test it with code. Save the manual testing for trades that can't be coded up. I certainly don't mean to knock discretionary trading. Some (most?) of the most successful people on this board don't rely on a fixed rules system. I myself would prefer to not use a fixed system. But it has been suggested that it's good to do system testing first to get an understanding of what works and why. Then use that understanding to develop your own discretionary system.

Please don't let me discourage you from your original plan. Pav started his "Simulated Trades and Analysis" thread and I'm certain he doesn't regret it for a moment. We all learn when people share.



kid hustlr said:


> I want to be succesful and I recognise it's going to take time. I'm simply trying to be realistic,




I understand. I didn't mean to imply that you weren't taking it seriously or that you need to devote your life to it. I personally failed because I constantly allowed the rest of my life to interrupt my trading goals. This pushed trading into the category of a hobby that I do when I have time. Now after years of studying trading I haven't accomplished anything significant. I just wanted to say, don't do what I did.

On the software. I don't know much about free stuff. Incredible charts as skc suggested is a good option. Back when I used them, the data for the day was delivered after midnight. Which might not suit your needs.


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## kid hustlr

*Re: Beginner's Blog*

It was pretty quiet at work today so I had a good read around a few of the beginner threads on the forums. I literally searched beginner.

I think my major goal for this week is to just establish what software I'm going to use. I should have a decent amount of free time on Sunday so the plan is to set myself up with Amibroker (I'm not sure if it's free or a couple of hundred bucks) and get used to using its basic charting software. That coupled with interactive brokers as my trading software and an excel file to keep my notes should be all I need for now. I'll need live data at some stage but I have Iress at work and as I said I'm not looking at really short term trading yet.

I'm a little concerned about my quantitative skills (or lack of?). I'm naturally mathematical and I know my way around a computer but the idea of writing code to hand craft a trading system seems a bit beyond me. Back testing and system testing is more of a factor in trading than I realised and it sounds like its something I'll need to get used to. I guess in my mind I just imagined learning all the tech/a techiniques then being able to identify what method would be best for a given market. Clearly it requres more work than that.

I also printed off Jack Schwagger's 'the new market wizards' at work today so I now have my bus reading to and from work set.


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## kid hustlr

*Re: Beginner's Blog*

I downloaded AmiBroker.

Very cool charting software and clearly something which will take a while to master. Will work through the guide/introduction and start becoming used to all the functions.

Am 40 pages in to the New Market Wizards as well, its proving to be very good bus reading I'm loving it.


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## Garpal Gumnut

*Re: Beginner's Blog*



kid hustlr said:


> It was pretty quiet at work today so I had a good read around a few of the beginner threads on the forums. I literally searched beginner.
> 
> I think my major goal for this week is to just establish what software I'm going to use. I should have a decent amount of free time on Sunday so the plan is to set myself up with Amibroker (I'm not sure if it's free or a couple of hundred bucks) and get used to using its basic charting software. That coupled with interactive brokers as my trading software and an excel file to keep my notes should be all I need for now. I'll need live data at some stage but I have Iress at work and as I said I'm not looking at really short term trading yet.
> 
> 
> 
> I'm a little concerned about my quantitative skills (or lack of?). I'm naturally mathematical and I know my way around a computer but the idea of writing code to hand craft a trading system seems a bit beyond me. Back testing and system testing is more of a factor in trading than I realised and it sounds like its something I'll need to get used to. I guess in my mind I just imagined learning all the tech/a techiniques then being able to identify what method would be best for a given market. Clearly it requres more work than that.
> 
> I also printed off Jack Schwagger's 'the new market wizards' at work today so I now have my bus reading to and from work set.




You sound very well prepared.

If you ever get stuck, go back to basics.

Dow, FTSE, XAO, XJO.

Monthly, weekly, daily charts.

Never ignore price and volume.

Indicators useful, but should never be a deciding factor over price and volume.

Don't ever be afraid to take a loss.

Conserve your capital at all costs.

gg


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## kid hustlr

*Re: Beginner's Blog*

Thanks gg.

Still getting hand of AmiBroker. It seems to have that same feeling as excel where it can pretty much do anything, you just need to know how to do it. The question is how far down the rabbit hole do I want to go.

I found a post by Wyswig (sp?) which had a link to the top 500 holdings in the ASX so that saved me a stack of time as I don't have to write out each ticker manually. I just need to add in a few of the major indices and I'm good to go as far as data goes (for now).



Goals for this week:
Continue reading Schwagger on the bus
Work through the introduction/tutorial documents on Amibroker
Check over a few chapters in Murphy (EW, relative performance + some others).


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## Reasons

*Re: Beginner's Blog*

Hi

Get hold of Dr. Alexander Elder's book 'Come into my Trading Room - A Complete Guide to Trading', read it, study it, anotate it and re-read it again as many times as is necessary to fully understand what he has to say.  As he has significant practical trading experience you will likely learn faster than most about what resources, knowledge and processes you need to acquire before you start and then how to competently begin trading - and because he actually trades, his trading ideas are logical, simple and with time and experience you will find they work.

I have not updated these lists below for a few months, but they are close enough and it sounds like they might be of use...

Cheers


*ASX20*
AMP, ANZ, BHP, BXB, CBA, CSL, MQG, NAB, NCM, ORG, QBE, RIO, STO, SUN, TLS, WBC, WDC, WES, WOW, WPL

*ASX20 to 50*
AGK, AIO, AMC, ASX, AWC, CCL, CFX, CPU, CWN, FMG, GPT, IAG, ILU, IPL, LEI, LLC, MGR, NWS, ORI, OSH, QAN, QRN, SGP, SHL, STO, TCL, TOL, WOR, WRT

*ASX 50 to 100*
AGO, ANN, APA, AQP, BBG, BEN, BLD, BLY, BOQ, BSL, CGF, COH, CPA, CPB, CQO, CSR, CTX, DJS, DOW, DUE, DXS, EGP, FXJ, GFF, GMG, HVN, IOF, JBH, JHX, LYC, MND, MTS, MYR, OST, OZL, PDN, PNA, PRY, RHC, RMD, SEK, SGM, SKI, SWM, TAH, TSE, TTS, TWE, UGL, WHC

*ASX100 to 200*
AAD, ABC, ABP, ACR, AIX, ALL, ALZ, APN, AQA, AQG, ASL, AUN, AUT, AWE, AZT, BDR, BKN, BOW, BPT, BTU, BWP, CAB, CDU, CHC, CNU, CPL, CQR, CRZ, DLX, DML, DTE, EHL, ENV, ERA, EWC, EXT, FBU, FKP, FLT, FWD, GBG, GCL, GNC, GNS, GRY, GUD, GWA, HDF, HGG, IAU, IDL, IFL, IGO, IRE, IVC, KAR, KCN, KZL, LNC, MAH, MBN, MDL, MGX, MIN, MML, MMX, MQA, MRM, MSB, NUF, NVT, NWH, OGC, OMH, PAN, PBG, PPT, PRU, PTM, QUB, RRL, RSG, SBM, SDL, SFR, SGT, SIP, SMX, SPN, SPT, SVW, SXL, TEL, TEN, TPI, TPM, TRS, WEC, WSA, WTF

*ASX200 to 300*
AAC, AAX, ABY, AJA, ALD, ALK, ALS, AMX, ANG, APZ, ARP, ARU, ASB, BND, BRM, BTA, CCP, CCV, CDI, CFE, CFU, CIF, CLO, CNX, COK, CSV, CVN, DCG, EAU, ELD, ELM, EVN, FGE, FML, FMS, FXL, GGG, GRR, GXY, HIG, HIL, HST, HZN, IFN, IGR, IIN, IMD, IMF, IRN, IVA, KMD, KRM, MCE, MCR, MMS, MNC, MPO, MTU, NFE, NXS, OKN, PLA, PMV, PRG, PRR, PXS, REA, RMS, ROC, RXM, SAI, SAR, SDM, SGN, SKE, SLR, SLX, SPL, SRQ, SSN, STB, SUL, TAP, TGA, TGR, TGS, TGZ, TOX, TRY, UNS, WTP

*ASX300 to 500*
AGG, AGS, AHD, AHE, AJL, AKM, AMM, APE, API, ARH, ASZ, ATI, ATR, AUB, AVJ, AZM, AZZ, BCS, BFG, BKL, BKW, BKY, BMN, BOC, BOL, BRG, BTT, CCC, CDA, CDD, CDP, CGX, CHN, CMG, CMJ, CMW, CNA, CNP, COE, COF, CUE, CUP, CUS, CVW, CWP, CXM, CZA, DLS, DMP, DTL, DVN, DWS, DYL, EPW, EQT, EQX, ESV, EXS, EZL, FAN, FPH, FRI, GDO, GDY, GEM, GLG, GNM, GOW, GOZ, GPG, GUF, GWR, HGO, HHL, HIN, HTA, IOH, IPD, IXR, JET, JMS, KAM, KGD, KGL, KRL, KSC, LEP, LNG, LWB, LYL, MAQ, MCO, MCP, MEO, MFG, MGO, MIO, MLB, MLD, MLX, MOC, MOL, MSF, MYS, NAN, NCK, NCR, NDO, NFK, NGF, NHC, NHF, NHR, NKP, NMG, NYO, OCP, ORE, ORL, PAG, PEM, PEN, PFL, PGA, PLV, PMP, PPC, PPX, PRT, QRX, RCG, RCR, RDF, RED, REH, RES, REX, RFG, RHG, RHI, RHL, RIA, RIC, RKN, ROL, RRS, SDG, SEA, SFH, SGH, SHV, SIH, SKC, SKT, SLM, SLP, SMM, SOL, SPH, SRV, SRX, SSM, SST, SWL, SXE, SXY, TAM, TFC, THG, TLM, TNE, TOE, TRU, TSO, TWO, UBI, UOS, UXC, VRL, WBB, WCB, WEB, WHG, WPG, ZIM


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## kid hustlr

*Re: Beginner's Blog*

Thanks reasons. Once I've finished market wizards I'll get to it.

Wysiwig (there's no way thats how you spell his name) warned me that the list was out of date but I'm sorted anyway as I jumped onto Iress at work and printed off a watchlist of the top 500 so now I'm DEFINITELY sorted.

I'll need to actually purchase Amibroker soon because uploading the data each time will start to get on my nerves. That said whils't im still learning the program there's no rush.

There's not enough hours in the day.


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## Reasons

*Re: Beginner's Blog*

Have never used Ambibroker - I use something called Bullcharts. It provides multiple lists of ASX shares and indicies as shown below. I then use Excel to sort between lists so I get a shares list difference between say the top ASX20 and 50, 50 to 100, etc as I listed for you, so you are not looking at everything twice when you want to concentrate on particular share groups through to the top 500 or whatever. Hope it all goes well and for what it is worth, severely limit the time you spend in these environments. Cheers.


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## kid hustlr

*Re: Beginner's Blog*

Been a slow week on the personal trading front. I'm still reading to and from work and I had a bit of a play around with AmiBroker today - I have most of the basics down pat now which is good. Unfortunately the next couple of weeks may be difficult to get much personal time in given I have to study for a couple of work related tests. 

I'm keen to start taking a few positions over the next few weeks though. I know a couple of people on here suggested back testing etc and I WILL get to that but I wouldn't mind taking a couple of positions if I think I can make a small gain here and there. 

More in depth discussion coming soon when I get a chance.


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## tech/a

*Re: Beginner's Blog*



kid hustlr said:


> Been a slow week on the personal trading front. I'm still reading to and from work and I had a bit of a play around with AmiBroker today - I have most of the basics down pat now which is good. Unfortunately the next couple of weeks may be difficult to get much personal time in given I have to study for a couple of work related tests.
> 
> I'm keen to start taking a few positions over the next few weeks though. I know a couple of people on here suggested back testing etc and I WILL get to that but I wouldn't mind taking a couple of positions if I think I can make a small gain here and there.
> 
> More in depth discussion coming soon when I get a chance.




The lure of profit just too strong eh!
Lesson #1 on it's way.


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## Trembling Hand

*Re: Beginner's Blog*



tech/a said:


> The lure of profit just too strong eh!
> Lesson #1 on it's way.



LOL

Which will quickly lead in to all the "other" lessons ending in the outcome of,

Psychology is the most important thing,
You must remove emotion from trading,
The insiders will always beat you,
TA doesn't "work",
You cannot time the market,
FX is better than ASX because you get 1X100 leverage,
The market is manipulated by Jewish dudes who run the world from NY therefore you cannot win,

etc etc etc,

:behead:


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## skc

*Re: Beginner's Blog*



kid hustlr said:


> Whilst I’ve learnt a huge amount over the past 12 months (about investing/trading/life etc) *it’s still obvious I have a great deal to learn before putting any money on the table *and as such I’m going to paper trade for a period of time to let me develop my skills and see if this is something I’m any good at. I have an interactive brokers account with a small amount of funds in their and as such I set up a paper trading account.




6 blog entries and 2 weeks later... SHOW ME THE MONEY. I've spent like 5 hours learning about the market - it owes me big time.


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## kid hustlr

*Re: Beginner's Blog*

Wow, lots of advice this morning.

Message(s) recieved.


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## kid hustlr

*Re: Beginner's Blog*

So I had a think.

First of all remember I'm new to this. I know cricket like the back of my hand. I could take anyone in this forum in a game of poker and I'm not a bad cook, but when it comes down to it I don't know much about trading yet. I might need things spelled out for me.

The idea with back testing is that there's no real need for a play money account (or atleast it greatly reduces the need)? 

For example If I look at a few charts, find one that I think there is opportunity (say for example, the price and volume seem to be forming a trend, the rsi is oversold and we are at a level of strong support), instead of buying in my play money account I should just backtest whether those conditions would have made a profit over the last 1,5,10 years?

If it would have made a profit THEN I go ahead with the trade?


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## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> So I had a think.
> 
> If I look at a few charts, find one that I think there is opportunity (say for example, the
> price and volume seem to be forming a trend, the rsi is oversold and we are at a level of strong support), instead of buying in my play money account I should just backtest whether those conditions would have made a profit over the last 1,5,10 years?
> 
> If it would have made a profit THEN I go ahead with the trade?




No. Back testing is about, firstly when you are a newbie, understanding *what *actually makes a profitable system. Secondly understand *when *your system is profitable and *when *its broken. The individual trade idea is a small part of having a profitable long term system.


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## tech/a

*Re: Beginner's Blog*



> The idea with back testing is that there's no real need for a play money account (or atleast it greatly reduces the need)?





No thats paper trading



> For example If I look at a few charts, find one that I think there is opportunity (say for example, the price and volume seem to be forming a trend, the rsi is oversold and we are at a level of strong support), instead of buying in my play money account I should just backtest whether those conditions would have made a profit over the last 1,5,10 years?




As an example this is a trading hypothesis.
Its an idea that you think "Could be profitable."
Many people actually trade Hypothesis and call them a trading plan.



> If it would have made a profit THEN I go ahead with the trade?




No you will be in the position to evaluate the system.
It will give you a *blue print *which you can then consider if its suitable for your trading requirements.

Besides profitability if you Montecarlo test it youll find out if you have a single run profitable system or a multiple porfolio loser.
Youll also find out important information like.
Maximum Peak to Valley and Maximum inital capital drawdown.
Youll find out time it takes to regain losses.
Average length of trade.
Youll know if losses or Gains came from a few outlier trades.
Youll be able to determine sweetspots for number of open positions and capital available.
Youll be able to test the inclusion of leverage.
Youll see average and maximum string of losses V strings of gains.
*Youll understand at last---RISK*
Youll know avarge return / $ gained.
Youll get to understand expectancy.
Youll be able to determine your database (candidates) through testing various markets and instruments.
Among many other stats.

Finally as T/H says 

Youll know WHAT makes a system profitable and how to identify if the market changes to such a degree that YOUR system trades outside of its blueprint to such a degree that it fails beyond know parameters.
Youll become pretty quickly one of those traders who actually *KNOWS* how Technical Analyisis *SHOULD BE APPLIED*

(Your hypothesis isnt profitable by the way)and I havent even tested it!


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## kid hustlr

*Re: Beginner's Blog*

Appreicate the help guys, seriously.

I think I'm getting it. All be it very slowly.

Last question, how does 'discretionary trading' fit into this? What about those guys who have a really good understanding of the drivers of a market/commodity/whatever and then trade of this? Do they even exist?

I feel like there is no need for someone who wants to be succesful to learn about 'the market' but rather they need to learn how to develop systems? Or perhaps having an understanding of what makes various markets work assists in devleoping systems?

I'd be better off playing roulette right now by the sounds of things


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## tech/a

*Re: Beginner's Blog*



kid hustlr said:


> Appreicate the help guys, seriously.
> 
> I think I'm getting it. All be it very slowly.
> 
> Last question, how does 'discretionary trading' fit into this? What about those guys who have a really good understanding of the drivers of a market/commodity/whatever and then trade of this? Do they even exist?
> 
> I feel like there is no need for someone who wants to be succesful to learn about 'the market' but rather they need to learn how to develop systems? Or perhaps having an understanding of what makes various markets work assists in devleoping systems?
> 
> I'd be better off playing roulette right now by the sounds of things




Its a journey.
One which will set you up for life.
Very very few do the years of apprenticeship and it *NEVER* ends.
Dont have pre concieved ideas as you currently have.
Let your education---educate you!

The first thing you need to do is understand what you need to do to actually develop a system.
Have a look at Howard Bandy's site.
http://www.blueowlpress.com/

Yes there are discretionary traders.
I existed as of a few minutes ago.
I know how to tilt the odds in my favor and know how to trade price action consistently profitably. But I started as a systems trader---Started Profitable trading.

Actually I started as an "expert" 17 yrs ago.
Lost 20K in the first few months.
Cheap learning experience just ask anyone who lost half their super in the GFC.


----------



## Gringotts Bank

*Re: Beginner's Blog*



kid hustlr said:


> Appreicate the help guys, seriously.
> 
> 
> 
> I'd be better off playing roulette right now by the sounds of things




Or stick with poker.  Are you profitable at that?  I knew a guy once who could make 3% per week, every week, year after year playing online about 4 hours a day after work.


----------



## kid hustlr

*Re: Beginner's Blog*

TA, Thanks. 

Gringotts, my poker adventure was a very succesful one which lasted 5 years. It's a story for another day though.

------

Lots of reading and practice required from me moving forward by the looks of it. I'll report back when I have something substantial to say (or I develop more questions).


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> Lots of reading and practice required from me moving forward by the looks of it. I'll report back when I have something substantial to say



Hopefully it will not include the words "moving forward" :


----------



## So_Cynical

*Re: Beginner's Blog*



kid hustlr said:


> I'd be better off playing roulette right now by the sounds of things




Thing is you don't want to treat trading/investing like gambling, and yet its unavoidable....i like to treat the market like a special game of roulette.

Stock market roulette is a game played with a very large roulette wheel, a wheel with 1000 unique slots each being a different shade of red or black, the higher the % of colour the higher the % pay out or loss, half the slots winners of varying % amounts and half losers of same...with one slot representing a 100% loss.

And of course you can only bet on red or black (up or down) 

Now the beauty of Stock market roulette is that at the end of every spin you get to choose if you want to accept the result or spin again free (as long as you have no leverage)...or you can add to or reduce your bet...and you can keep spinning for free as long as the 100% loss result doesn't come up.


----------



## waza1960

*Re: Beginner's Blog*

Re: Backtesting
         I would not use Amibroker as the learning curve is too great IMO for a beginner.
     You are much better off using one of the platforms with a Strategy wizard or GUI 
    interface for constructing strategies such as Ninja Trader or MT5 and others (no  
    coding required).
     You can construct basic strategies  that will allow you to explore different trading  
     approaches.


----------



## Trembling Hand

*Re: Beginner's Blog*



waza1960 said:


> Re: Backtesting
> I would not use Amibroker as the learning curve is too great IMO for a beginner.
> You are much better off using one of the platforms with a Strategy wizard or GUI
> interface for constructing strategies such as Ninja Trader or MT5 and others (no
> coding required).
> You can construct basic strategies  that will allow you to explore different trading
> approaches.



 Agree 100%


----------



## CanOz

*Re: Beginner's Blog*



waza1960 said:


> Re: Backtesting
> I would not use Amibroker as the learning curve is too great IMO for a beginner.
> You are much better off using one of the platforms with a Strategy wizard or GUI
> interface for constructing strategies such as Ninja Trader or MT5 and others (no
> coding required).
> You can construct basic strategies  that will allow you to explore different trading
> approaches.



 Hi Waza, I own and have used amibroker, ninjatrader, and multicharts. Amibrokers afl wizard is quite easy to use for basic coding. Ninatraders wizard is more difficult in my view.

Of them all, Power Language that MC uses is very similar to Easy Language of Tradestation fame, and is the easiest language to learn, in my view and I am not a coder by profession.

I would avoid ninjatrader until you become very competent at troubleshooting software issues as it is the least stable and proven compared to amibroker, tradestation, and multicharts.....in my view.

Cheers,


CanOz


----------



## Trembling Hand

*Re: Beginner's Blog*



CanOz said:


> Hi Waza, I own and have used amibroker, ninjatrader, and multicharts. Amibrokers afl wizard is quite easy to use for basic coding. Ninatraders wizard is more difficult in my view.



Nah? You cannot be talking about this wizard,




Simple as drag and drop price, indicator etc to a value and get an action. Then back test it. Perfect to start the journey. Can even use free data for stocks futs and FX. perfect.


----------



## CanOz

*Re: Beginner's Blog*

Here is the AFL Code wizard...like i said i thought it was easier to use...in my view.

NT is free EOD with data, so that's hard to beat. EOD is a good place to start as well.

I've spent allot of time on NT's forum trying to resolve issues that i just didn't have with Amibroker. Lots of issues were related to TWS fair enough, but Amibroker was a shorter learning curve for me.

On the bright side, once you become familiar with NT, the other platforms seem pretty easy 


Cheers,


CanOz


----------



## Trembling Hand

*Re: Beginner's Blog*



CanOz said:


> Here is the AFL Code wizard...like i said i thought it was easier to use...in my view.
> 
> NT is free EOD with data, so that's hard to beat. EOD is a good place to start as well.
> 
> I've spent allot of time on NT's forum trying to resolve issues that i just didn't have with Amibroker. Lots of issues were related to TWS fair enough, but Amibroker was a shorter learning curve for me.
> 
> On the bright side, once you become familiar with NT, the other platforms seem pretty easy



Yeah fair enough. I don't actually know a lot about Amibroker. And agree NT can be furiously frustrating when you run into a problem that NT doesn't recognise. But its certainly one of the ones to consider for a newbie before they start trading while they are clueless. 

With free world EOD data for FX, futs and equities and no platform cost beginners have no excuse for not backtesting before they start trading. Except that they don't really want to test anything just fly without a licence. :bricks1:


----------



## boofis

*Re: Beginner's Blog*

My 2c:
1. Get amibroker
2. Watch everything else in your life fall to the way side for the next 12 months while you become addicted learning how to use it lol.

But seriously, jump in and get the learning curve started. I'm only newish to this game also but Amibroker was the best move I've made so far. I also lost money at the start due to having no idea about anything but wanting to make the big money.


----------



## waza1960

*Re: Beginner's Blog*



> I would avoid ninja-trader until you become very competent at troubleshooting software issues as it is the least stable and proven compared to amibroker, tradestation, and multicharts.....in my view.



Totally agree regarding issues/stability/reliability I have traded NT live and too many error messages So I am certainly not recommending it except  to say its still a cheap easy way to explore basic trading strategies.
  I also own Amibroker and have tried a demo of Multicharts and trade live on Metatrader 4.


----------



## kid hustlr

*Re: Beginner's Blog*

Appreciate the responses. 

I d/loaded ninjatrader and the interface does seem a little easier to manage plus the fact that its free is handy for now.

One quick one, I uploaded the ASX 500 and it all works fine but I can't get the XAO/XJO indices to upload. Apparently ninja trader doesnt let you upload indices from Yahoo. Any other way I can upload the XAO?


----------



## kid hustlr

*Re: Beginner's Blog*

Nothing crazy to report.

Watching a whole bunch of ninja trader tutorials on youtube as well as playing around with all the functions. It's quite in depth but seems easy enough to use. I really can't wait to have a play around trying to design some system(s). walk before I can crawl though.

Still reading to and from on the bus, Am half way through the New Market Wizards and have also been reading some good material about system design by that guy from tradestation. Been tough to get much done lately however as I have a couple of exams next week which are my higher priority right now.


----------



## kid hustlr

*Re: Beginner's Blog*

Getting there.. slowly.

The elite trader website which I stumbled upon was really really helpful. 

Playing around with ninja trader is a slow process but I'm slowly starting to get the hang of it.

I feel like I'm definitely doing enough reading + learning, the most important thing for me to do now is to get my hands dirty with Ninja Trader and play around/explore as much as possible.


----------



## kid hustlr

*Re: Beginner's Blog*

I feel bad not having much to report. I'm still reading and learning but I jsut havent had a chance to have a good detailed play around with.

I've been having random thoughts it my head though for example I like the idea of some kind of short and long term moving average signal, but I'd like to play around with maybe taking some profits before the exit signal as it looks like you can lose a lot of profits at the back end of the trade.

Also I want to try and develop some form of reversal bar strategy (or atleast incorporate them somewhere as a set up or entry) as I feel a strong reversal bar on high volume is a very strong indicator.

Lots of thoughts floating around my head, Once I have some numbers to support some ideas my plan is to post them here.

Also note to self to order one (if not more) of the books T/A suggested earlier in this thread.


----------



## kid hustlr

*Re: Beginner's Blog*

So my blog is really boring given that all I’m doing is cutting my teeth with Ninja trader and reading in my spare time so I thought I’d jazz it up a little by rambling on about poker for a bit.

I used to do pretty well from it, I was always measured and I was lucky enough o stumble upon some good resources and sources of knowledge at the start of my journey.
I used to play mainly tournaments (for those who don’t know this is where each players starts with a  certain amount of chips, playing down until only one player remains with all the chips). Always No Limit Texas Holdem. It was good fun. I miss it. I used to play 12-15 games at once (I played mainly online) and on a given day I could easily play 50 tournaments in a session.

I never used to play outside my limit, for example you should only ever play with a very small percentage of your overall bankroll (like 0.5% per tournament, probably less). It’s amazing how many guys I saw go on a run and then blow themselves up, only to redeposit, rinse and repeat.

My playing style was pretty tight/aggressive but I always played to the numbers. Everything in poker is about expectancy. Just because it was the wrong decision this time or the outcome didn’t go your way this time doesn’t mean the decision is wrong.  I think a lot of the skills I developed in poker can be used in trading. At least I hope so.

----------------------------------------------------

On the trading front for myself there hasn’t been much doing at all. I’m waking up 1-2x a week early before work and effectively ploughing through indicators, learning how they work, not because I think I’ll use them all but because It’s handy to know how they work and it will improve my learning. I’m still pretty useless with NT for now and this is something I HAVE to work on.

I’m going to either hire or buy that Nick Radge book (Unholy grails?) and I’m also going to order one of the Howard Brandy books - Quantitative trading Systems. TH or T/A if you guys have any other suggestions please let me know.

This is a really long road, perhaps even longer than I had anticipated but I am VERY confident I will get there. My motivation is strong but I’m not sure it’s where I need it to be. I’m not sure why I should need motivation to learn something that could potentially save me from ever having to work another day in my life.


----------



## Joules MM1

*Re: Beginner's Blog*



Trembling Hand said:


> If you are going to trade using TA as your tool I would highly recommend you start with system testing.
> 
> You may also find out what incorrect with this statement,
> 
> 
> 
> 
> kid hustlr said:
> 
> 
> 
> 
> my plan is to take medium term positions, perhaps anything from 1 week to 3 months or more depending on the goal of the trade and the market movements. Ultimately I’m just looking to find what works best for me.
> 
> 
> 
> 
> Anyone?
Click to expand...



did we get an answer to this question.....maybe i've missed it




> "perhaps anything"



 is something other than a system or a business idea...vague...price is never vague....the person on the other side of the trade is probably not vague



> "1 week to 3 months"



again, purely arbitrary and the market/instrument is likely to act correctly sending you the "opportunity" signal you're looking for and then it falls apart leaving you stranded



> "depending on the goal of the trade"



 you need a solid plan, without which, a goal cannot be first quantified let alone (err) qualified .....



> "i'm looking to find out what works best for me"



 right.....


in some small way you are at an advantage as a successful gambler,  it's probably not in the way you feel.....it's in the way you think about numbers, nothing to do with waiting for the right opportunity to stare down an opponent........at least, that's a beginning with proving numbers rather than  (cough) rhetoric

back testing is one thing, forward testing is better, not necessarily with money, you can get a better handle without finding patterns or shapes or numerics by looking backwards and curve fitting ....forward testing offers challenges that back testing can't, one is hindsight and one is in the present....



i think you'll get a lot more suggestions from active traders when you put up, maybe once a day, an idea youre thinking about, youre just asking; how does this work, how come "it" doesnt work here, how come when this price did this and volume was this much price didnt go up ......a book only offers answers to the left-hand side and not to the right hand side of the chart.....be as specific as you can.....the questions that get answered in a book are from the authors pov at _that_ time in _that_ traders memory not the questions that are coming today.....

i think a lot of beginners want to ask questions and dont because theyre scared of appearing dumb.....get over that.....everyone starts at zero

this is just my 2c worth, 
just ideas....


----------



## ishakeel

*Re: Beginner's Blog*

Good luck.  Please remember to share your experience with us.  I am still doing paper trading and I find it is quite risky to put real money at this stage.  The market is too volatile and unpredictable.


----------



## kid hustlr

*Re: Beginner's Blog*

Not much to report on the trading front but lots going on in the real life front. Hopefully I'll have some more spare time now and I can concentrate on actually doing some back testing now.

I did finish T/H's blog from the past and I highly recommend it. He's definitely not a fan of Alan Koehler lol


----------



## kid hustlr

*Re: Beginner's Blog*

Joules,

Thanks for the advice, rest assured when I get a chance I'll be posting a whole heap of trading plans, as I said though i just have a lot of things going on. Hindsight says this wasn't the best time to start a blog but I've actually learned a whole heap already.

Random questions which I think experienced traders/market contestants will know:

- When people talk about 3 year bond yields, are they talking about the futures 3 Year Bond (YTSPOT.SFE ticker on IRESS) or the Commonwealth Government Bond (BOND3.IR ticker on IRESS)?? I'm guessing one is just the futures contract of the other??

- Where do people go for Economic data. Like If I wanted to find out what announcements are being released today/this week on both the Aussie market and abroad, I assume there's a few websites which show this? Which one is the best? 

- What's the difference between the 90 day bank bill rate (Bill90.IR on IRESS) and the Bank Bill Swap rate 3M (BBSR3M on IRESS).


----------



## kid hustlr

*Re: Beginner's Blog*

A couple of other questions:

- Does anyone trade the ASX mini's? Reading the ASX website it says the ASX offers contracts for 10 dollars a contract whilst the SFE offers the asx 200 futures at 25 dollars a contract. Is it effectively the same exchange of are they completely different?

- If I wanted to trade on other exchanges, (I'm with IB) would I just need to select the option to trade futures in australia or do I need to select the option to trade futures on other exchanges as well?

appreciate the help guys, it's hard for me to develop strategies in my spare time at work but I can read and learn the practical side of things which will help me down the track.


----------



## kid hustlr

*Re: Beginner's Blog*



kid hustlr said:


> A couple of other questions:
> 
> - Does anyone trade the ASX mini's? Reading the ASX website it says the ASX offers contracts for 10 dollars a point whilst the SFE offers the asx 200 futures at 25 dollars a point. Is it effectively the same exchange of are they completely different?
> 
> - If I wanted to trade on other exchanges, (I'm with IB) would I just need to select the option to trade futures in australia or do I need to select the option to trade futures on other exchanges as well? For example if I wanted to trade the HSI what options would I need to select in IB.
> 
> Appreciate the help guys, it's hard for me to develop strategies in my spare time at work but I can read and learn the practical side of things which will help me down the track.




Amended my post.

http://www.asx.com.au/products/types-of-asx-index-futures.htm#sp_asx_200_index_futures

is the link to the mini futures.


----------



## stevetamer

*Re: Beginner's Blog*



kid hustlr said:


> I downloaded AmiBroker.




I have been using AMIBroker for years and as a software developer there  is no system that cannot be written in this application. Other software  packages costing thousands cannot match the power of AMIBrokers. The  pacakges that do match all the AMIBroker features leaves you wondering  why they want thousands and AMIBroker only a couple of hundred bucks. It  is a Fantastic applcation. Now, can you write a trading system that can  make money, that is another story.


----------



## Trembling Hand

*Re: Beginner's Blog*



> - Does anyone trade the ASX mini's?



 No they are rubbish. Completely illiquid. If you want to trade under $25 per tick use crapy old CFDs.



> - If I wanted to trade on other exchanges, (I'm with IB) would I just need to select the option to trade futures in australia or do I need to select the option to trade futures on other exchanges as well? For example if I wanted to trade the HSI what options would I need to select in IB.



To trade other exchanges well you clearly have to have trading permissions for those exchanges. Au futs exchange - SFE, is for Au contracts only.


----------



## kid hustlr

*Re: Beginner's Blog*

Having also sorts of trouble trying to get data in Ninja Trader. All I'm looking for is EOD data (daily and higher) for the major currency pairs, commodities and stock future indexes.

Kinetick seems to have some futures contracts but not all (ie. it doesn't have the SPI) and when I try to link IB to NT I can't seem to get any decent data, just a bunch of error messages etc.

Does interactive brokers provide free end of day data or do I need to pay in order to get what I'm after?

Does anyone know where I can the data I'm looking for?


----------



## Trembling Hand

*Re: Beginner's Blog*

No historical free data through the API from IB.

Kinetic has all US/Euro futs including commodities. As well as all FX pairs.

To get Aus stock use the yahoo connection.


----------



## kid hustlr

*Re: Beginner's Blog*

You're a weapon TH

Does this mean i effectively can't get the SPI without paying for it?

EDIT: also I had to uninstall my TWS and install some old school version of TWS (link provided on NT website somewhere) in order to get NT and IB to talk to each other, anyone else have that problem?


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> You're a weapon TH
> 
> Does this mean i effectively can't get the SPI without paying for it?




Thats correct as far as I know.



kid hustlr said:


> EDIT: also I had to uninstall my TWS and install some old school version of TWS (link provided on NT website somewhere) in order to get NT and IB to talk to each other, anyone else have that problem?



You must be using an old version of NT?


----------



## Lone Wolf

*Re: Beginner's Blog*



kid hustlr said:


> You're a weapon TH
> 
> Does this mean i effectively can't get the SPI without paying for it?
> 
> EDIT: also I had to uninstall my TWS and install some old school version of TWS (link provided on NT website somewhere) in order to get NT and IB to talk to each other, anyone else have that problem?




Just to clarify... data for the Sydney Futures Exchange is free on IB. So you should have no problem getting the SPI up in NT. Although if you're looking for historical data it might not go back far enough for you.

It used to be the case that you had to install an outdated version of TWS to connect to NT. But I recently (well, months ago) installed the latest versions of both and they work fine. Although I think the NT connection guide still specifies an old version. I actually had to update because I tried to log into TWS and it booted me out saying the old version of TWS was not supported.


----------



## kid hustlr

*Re: Beginner's Blog*

Ta guys will investigate this afternoon.

I definitely have an up to date version of NT though

Also Howard Brandy makes my head hurt


----------



## kid hustlr

*More questions*

Firstly I'm like 99% sure I can't get the SPI data but thats ok because the point of the exercise right now is having some basic data to work with (futures/commodities/currencies) and seeing what works from a mechanical point of view.

I'm having trouble with the S&P 500 data. The futures contract looks completely different to the index and I'm not sure why. See attached screen shot, why don't they look exactly the same?? Is the futures contract night and the index data during the day or something??

Also, with time zones, how do people set up the time zones for all other contracts, for example currencies trade 24/7 so when does one day end and the other day start?

Also, how do I know what the current contract is? Like is the front month for the SP 06/12 or 07/12 or what?


----------



## kid hustlr

*Re: Beginner's Blog*

Looks like the ES contract is what I'm after?? Why does the SP futures contract look so different to both the ES and the S&P 500 index  ??


----------



## Joules MM1

*Re: Beginner's Blog*

still travelling same rout.....liquidity and participants....


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> Looks like the ES contract is what I'm after?? Why does the SP futures contract look so different to both the ES and the S&P 500 index




You have the wrong month. March, June, Sep & Dec. For US equity futs.


----------



## kid hustlr

*Re: Beginner's Blog*

Thansk Guys, I'll try the 9/12 contract when I get home tonight.

One more:

Why aren't there any gaps in the charts for the ES contract??, do I need to adjust the time settings somewhere??

:1zhelp:


----------



## Trembling Hand

*Re: Beginner's Blog*

Its a 24 hour contract


----------



## kid hustlr

*Re: Beginner's Blog*

But the SP500 is only open cash hours? How come there is no gaps in that chart?

Do I need to enter in manually the time zones or something to ensure it only shows 8.30am to 3.15pm ?

In your post here:

http://tremblinghandtrader.typepad.com/trembling_hand_trader/2010/week6/index.html

I see that on the SPI chart you need to adjust it to 9.30 am to 4.10pm to get the cash hours.

I think I'm gonna owe you a Coke when this is all over.


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> But the SP500 is only open cash hours? How come there is no gaps in that chart?




The data is not the opening price of all stocks, just the first tick of a few. They don't all open at the first second.


----------



## kid hustlr

*Re: Beginner's Blog*

60 hrs a week of work + settling + family health issues has meant trading has been on the backburner last weeks. Will be a big change of scenery for me soon which will lead to much more free time, and I can actually post something worthwhile.

I'm not going to waste my time trying to get all the required data for futures + fx and things I now realise I need to pay for these things and I will do when I can justify it. Will just backtest EOD ASX stock from yahoo to begin with.


----------



## kid hustlr

*Re: Beginner's Blog*

So where were we.

Its been over a month since my last update. I’ve since quit work (I finish tomorrow) and I’ll be doing some stuff which gives me a lot more free time. Very excited about this as I feel I can actually make some progress and turn myself into the market/systems nerd I need to be.

Just on that last bit – systems. I need to remind myself that learning systems is the current goal. Reading CanOZ talk about market profile or trying to work out wtf Jouless + T/H are saying the banter thread is fun and interesting but its not going to teach me how to make money. There will be a time when those discussion will matter and it wont take me 10 minutes to learn what sinner means every time he posts, but its not anytime soon.

_I need to concentrate on developing the statistical knowledge and skills required to develop a mechanical and/or automated trading system._

This means learning the ins and outs of data collection, the software programs and measuring success. It’s important to ‘keep in touch’ but I think reading Bloomberg, ASF, commsec, daily news and the odd blog is more than enough to know what’s going in the broader picture. _At the end of the day I need to spend my time learning how to make money._

Anyway, I also moved out on Sunday so all the baggage that comes with that is still being sorted. Apparently TPG will take 10-20 business days before my internet is connected which is a let down but that’s just part of life. From Monday onwards I won’t have internet for a little while and then I go to Europe at the end of August so the next few months will be bumpy but post Europe its all hands on deck and no excuses. Life is short I should put the effort in.

From a trading perspective I’m dying to trial a couple of very basic systems relating to up key reversals and pivot points. When I get to this stage I’ll be blogging everything and asking questions about what I’m doing wrong. I’ve also had trouble with Yahoo Data recently and it just doesn’t seem to be working so google finance it is for now. I wont be paying for data for a while yet.

So as I sit here on my 2nd last day of work I’m super excited about the future. Unfortunately the next period of time will be choppy. I don’t even have a couch or tv yet.


----------



## Steve C

*Re: Beginner's Blog*



kid hustlr said:


> So I had a think.
> 
> First of all remember I'm new to this. I know cricket like the back of my hand. I could take anyone in this forum in a game of poker and I'm not a bad cook, but when it comes down to it I don't know much about trading yet. I might need things spelled out for me.
> 
> The idea with back testing is that there's no real need for a play money account (or atleast it greatly reduces the need)?
> 
> For example If I look at a few charts, find one that I think there is opportunity (say for example, the price and volume seem to be forming a trend, the rsi is oversold and we are at a level of strong support), instead of buying in my play money account I should just backtest whether those conditions would have made a profit over the last 1,5,10 years?
> 
> If it would have made a profit THEN I go ahead with the trade?




OP, I am really enjoying this thread, I am bascially in an indentical situation too you, have read a few books, trying to learn and read all I can on here. You seem to have more techinical knowledge then me which is something I am trying to understand at the moment.

The idea of backtesting sounds really good, how exactly does one do it though? do you need to learn programming code in amibroker? 

Make sure you keep us posted OP - what you are doing at the moment is what I hope to do in a couple of months.


----------



## kid hustlr

*Re: Beginner's Blog*

Thanks Steve C.

Make no mistake I still feel like I'm an absolute noobie. That being said I've leared a stack over the last year. 

Working in an investment team for the last year has allowed me to develop an understanding of how the market as a whole works. Have also developed a good understanding of different types of asset classes, be it debt/equity/etf's/managed funds/overseas investments etc.

I've also learned a great deal readin this forum. I think the trick is knowing who to listen to and being able to decipher through all the text to find things which apply to you. As I said, right now I need to become far more technical and understand the systems side of things. The learning curve will be massive.

With regards to backtesting, again I'm green. Effectively there a number of charting and backtesting software programs out there which allow you to test concepts. Amibroker is one of them. It has been suggested to me that Ninjatrader is a good place to start as it quite easy to test simple systems. This is where I am up to now.

I'd suggest having a looking at a few (and by that I mean all) of the threads in the trading strategies/systems area of this forum. That's my plan.


----------



## tech/a

*Re: Beginner's Blog*

I note many are looking at the Systems path.

I think this is *one of the best things *a serious newbie can do.
It will overtime tell you more about what doesnt work than most anything else.
What not to waste your time with and that all systems arent equal.

Youll soon learn that just about anything works in a bull market.
Youll find that short and being out of the market at times are the best positions.

Simple is often best.
Your discretionary trading will improve.
Your Risk and portfolio management will improve.

It wont be long and youll have a light bulb moment.

Sure there is a lot to learn---but then anything worth while takes time.
Dont be to fast in investing in the market and too slow/stingy in investing in your education.


----------



## cudderbean

*Re: Beginner's Blog*



kid hustlr said:


> Thanks Steve C.
> 
> Make no mistake I still feel like I'm an absolute noobie. That being said I've leared a stack over the last year.
> 
> Working in an investment team for the last year has allowed me to develop an understanding of how the market as a whole works. Have also developed a good understanding of different types of asset classes, be it debt/equity/etf's/managed funds/overseas investments etc.
> 
> I've also learned a great deal readin this forum. I think the trick is knowing who to listen to and being able to decipher through all the text to find things which apply to you. As I said, right now I need to become far more technical and understand the systems side of things. The learning curve will be massive.
> 
> With regards to backtesting, again I'm green. Effectively there a number of charting and backtesting software programs out there which allow you to test concepts. Amibroker is one of them. It has been suggested to me that Ninjatrader is a good place to start as it quite easy to test simple systems. This is where I am up to now.
> 
> I'd suggest having a looking at a few (and by that I mean all) of the threads in the trading strategies/systems area of this forum. That's my plan.




If you only think you have a system, it really is just a stab in the dark and a wing and a prayer until you backtest it... as widely and thoroughly as possible over varying market conditions. Gives you much more confidence in your trading. I’ve tweaked my system up to 90% Profit index, 25% annualized return, and 74% winning trades, 24% losers, and 2% breakeven..IFF I follow every trade fastidiously which of course leads me to the weakest link in the chain..ME!

I heartily recommend Tradesim..very helpful owner, David Samborsky of Compuvision. Only $200 and upgradable to more sophisticated versions when you’re ready for that.
Tradesim works very easily with Bullcharts and Metastock. I much prefer Bullcharts because I can import and export lists to Excel ..my main live data scanning workhorse which catches moves as they happen. And BC is a homegrown Aussie product too with excellent customer care.

Bullcharts and consequently Tradesim (linked language) not difficult to program.. spend a few days with it on your European trip. Start off with something very simple such as MA crossover and discover that profitability is not so easy as that.. MA_Xover can even be quite unprofitable in fact, then graduate from there as your coding skills improve. There are some very generous people on the net..learn from their example coding.

I had a very complex system at one stage, but now I use only 3 indicators which draw my attention to potential buys, 2 simple ones I invented, and a >25EMA filter in a bull market that enhances the performance of the other two. Other EMAs work too, but 25EMA works best for my style of trading.

Put a big sign above your trading desk:  Don’t be greedy; Don’t panic...and above all Don’t throw your tried and tested system out the window. Tweak it and back test it again by all means, but not in mid trade. Try to keep emotions out of the loop, and treat the profit /loss figures as numbers...not real money..sounds daft, I know, but it works for me. 

If in doubt or you find yourself hoping, praying, burning joss sticks at the local Buddhist temple or having nightmares about your portfolio, stand aside. The market will still be there tomorrow and next week. Do practise Risk and Money management.

Good luck mate.


----------



## Joules MM1

*Re: Beginner's Blog*



cudderbean said:


> ...... backtest it... as widely and thoroughly as possible over varying market conditions....






tech/a said:


> ...many are looking at the Systems path.
> ...It will over[ ]time tell you more about what doesnt work than most anything else.
> It wont be long and youll have a light bulb moment.




one is looking backwards is prone to fitting, most likely missing key operating components such as slippage, costs, the input of time on the trader to mention just a few

the other is forward worked, under real stress, encountering key moments and unknowns that cannot be synthetically experienced......  and with the (real time) time constraints

these are things to consider........

just ideas


----------



## cudderbean

*Re: Beginner's Blog*

I have included costs at .08 of 1% each way which is the brokerage I pay.

I have not included slippage as a set %. I have tried to cover that using the calculatable trigger figures for my 3 automated indicators...i.e using algebra in an Excel cell what must ... the price be tomorrow to trigger

auto calculated momentum x
auto calculated short term resistance/support y
25 ema (an entry criterion, not an exit trigger)

...oops I forgot volume

volume on entry must be at least 80% of its 20 day SMA of vol. Of course you cant normally calculate that till later in the day so I use a predicted figure in the morning based on how the code is performing pro rata of the time elapsed in the trading day so far and also the mood of the rest of the market.

..and there's one other indicator ..expanding Bollinger Bands that is sometimes the icing on the cake turbo charger.

I only trade in the top 150-200 liquid companies which I recalculate each weekend. I eliminate also co's that trade on overnight markets such as BHP and RIO that may give you a nasty shock next day by gapping too much.

My entries are at my discretion, my Stop Loss exits auto.

But you're quite right...what's to say my calculated trigger EXIT figures which I place as contingent orders beforehand will be filled perfectly. I don't know how to deal with that...what do you suggest .... % of ATR?

The discretionary bit comes in when my system selects several codes and I decide by eyeballing the live chart patterns and past daily/weekly patterns and daily weekly support/resistance whether I fancy it or not.

My system itself averages about 1.6 trades per day..which could of course mean more or less than that. I have allowed for 20 open trades which would be hopeless to monitor without auto SL orders.

Of course my system is not the Holy Grail, and I may not in reality achieve the same returns, but backtesting gives me the confidence that the chart patterns I am eyeballing may have the odds on their side.

The lifestyle I lead when living In Thailand for half the year and the time zone doesn't lend itself to monitoring the market constantly. When I'm not in Perth, I sometimes don't wake up till 3 hours into the session. NZ is the best spot for trading the Aussie market I reckon... wake up not too early, a leisurely breakfast, a spot of research, market opens at 12 noon NZtime, and close 6pm ..just in time for a sundowner...you lucky Kiwis, such fabulous scenery too... I may go and join my niece's family living there!

Thanks for your help


----------



## kid hustlr

*Re: Beginner's Blog*

14/8/12

So the technician from TPG is coming tomorrow to set up the internet for my apartment so as of tomorrow I'm back from the stone age. Currently sitting in the library enjoying having a pretty easy day.

Between organising my Euro trip, switching careers and moving into an apartment I feel like I haven't had much time for anything else. I'm getting through all my tasks though which is good and by the end of this week things will settle down.

I re-read Murphy's technical analysis book and am halfway through qauntitative trading systems by brandy. I also watched the DVD which came with book yesterday and I found it very informative. I mean lets be honest at the end of the day statistics isn't the most exciting topic but there's some little part of me that likes knowing the maths behind the scenes. Also now that I'm taking this on I don't like losing so I know I won't quit until I've given it all I have. 

Howard on the off chance you read this, the DVD didn't work on 2 of my DVD players or my laptop, it only seemed to work on my computer. Also I didnt realise you were from Arizona, I did 6 months at ASU and it was defintiely the best 6 months of my life. ASU girls were really um, friendly.

Was interested to here Howard talk about market diffusion at the end of the lecture. From what I gather, *having a strong understanding of market breadth and the overall flow of the market is one of the most important things I can do*. I know T/H likes his market breadth and Joule's often refers to put/call ratios etc, I think sinner mentioned something about the mclennan index on here recently to. Effectively they are all looking at the same concepts and assist us in keeping our finger on the pulse of the overall market.

It had me thinking and I want to get into the habit of maintaing/keeping an eye on 5-6 of these 'diffusion indicators' for the ASX and S&P. Not so much to develop any mechanical systems, just to ensure I always have a feel of wahts going on.

At this stage I'm thinking:
Advance/Decline (I like the 10 day advance/decline MA oscillator version)
52 week highs/lows
VIX
some kind of option indicator.

I'm sure this list will grow and chop and change as I learn more. Any suggestions on others I use would be much appreicated.

On another note, I cant believe I need to blow the dust of my year 1 lecture notes to remind myself about t-tests. feels like forever ago!


----------



## kid hustlr

*Re: Beginner's Blog*

Finally have the internet. That was a rough couple of weeks.

Head to Europe on Monday. Very cool/excited.

Have watched Howard Bandy talking at the national conference in Melbourne in 2009 twice now and I'm still confused about walk forward analysis.

I understand that ''in sample'' results mean nothing and its the out of sample results which are important. With walk forward analysis do we optimize after each out of sample period? Then these new parameters are now our system? 

My understanding was that if the system performed well on out of sample data it should be traded as is but looking at the walk forward analysis picture in the link below this isn't the case?

http://codefortraders.com/Walk-Forward_Analysis/WFA_Introduction.htm


----------



## kid hustlr

*Re: Beginner's Blog*

Still planning on making all the money in the world.

The more I learn the stupider I feel


----------



## kid hustlr

*Re: Beginner's Blog*

OK!

Well 2013 I'm giving myself 1 day a week devoted to trading. I'm lucky enough to not have to answer to a boss and I'm giving myself Wednesday off each week in order to learn how become the greatest trader in the world. I figure it shouldn't be too hard. It's actually a welcome change as my normal routine is pretty stressful so breaking it up midweek is a good opportunity. Plus at the end of the day its what I want to do so I may as well make a run at it!

Today it took me most of the day to work out but I have finally got the SPI set up on Ninja trader so I can watch it and play around with it. Also worked out how to set up day and night sessions as well as how to use the session manager and a couple of other neat tricks on NT. Slow and steady at this stage but I think I'll slowly get my head around the software.

As far as goals I recognize I'm light years away from trading real cash. I've set myself the first goal of developing some EOD systems for Aussie stocks and then taking it from there. This blog from here on out will be the tale of my trials and tribulations as I learn to use the NT back testing facilities. Hopefully the things I learn from that will one day lead me down the path of intra day work but only time will tell on that front.

Truth be told I had no reason today to spent so much time worrying about setting up the SPI but it's all a learning process and now I can sleep at night knowing I have it working properly.


----------



## professor_frink

*Re: Beginner's Blog*



kid hustlr said:


> OK!
> 
> Well 2013 I'm giving myself 1 day a week devoted to trading. I'm lucky enough to not have to answer to a boss and I'm giving myself Wednesday off each week in order to learn how become the greatest trader in the world. I figure it shouldn't be too hard. It's actually a welcome change as my normal routine is pretty stressful so breaking it up midweek is a good opportunity. Plus at the end of the day its what I want to do so I may as well make a run at it!
> 
> Today it took me most of the day to work out but I have finally got the SPI set up on Ninja trader so I can watch it and play around with it. Also worked out how to set up day and night sessions as well as how to use the session manager and a couple of other neat tricks on NT. Slow and steady at this stage but I think I'll slowly get my head around the software.
> 
> As far as goals I recognize I'm light years away from trading real cash. I've set myself the first goal of developing some EOD systems for Aussie stocks and then taking it from there. This blog from here on out will be the tale of my trials and tribulations as I learn to use the NT back testing facilities. Hopefully the things I learn from that will one day lead me down the path of intra day work but only time will tell on that front.
> 
> Truth be told I had no reason today to spent so much time worrying about setting up the SPI but it's all a learning process and now I can sleep at night knowing I have it working properly.




Have you set up a journal to fully document everything you are doing yet?


----------



## kid hustlr

*Re: Beginner's Blog*



professor_frink said:


> Have you set up a journal to fully document everything you are doing yet?




ya just a word doc, ty frink


----------



## kid hustlr

*Re: Beginner's Blog*

So I had to run a few errands this morning so my 'trading day' was cut a little short. Still a productive day though.

This morning I continued to get accustomed with Ninjatrader. I set up a Market Analyser list which is a pretty cool function. I've effectively put all the major indices/currencies in their and I plan on adding to it over time. I think it's a good way of getting a 'snapshot' of what happened overnight etc etc. Unfortunately it's not really useful for me at this stage as I need a life data feed in order to view the data but hey, all in good time!

I also watched a 2 hour video from Radge:

http://vimeo.com/19621172

It just covers the basics but its a great refresher on both the basics of statistical variance which can occur as well as the mental attitude required in this game. There's a lot of similarities between trading and poker and if nothing else the video reminded me of what my attitude towards poker should be.

The graph below shows my results over the last few months and whilst the general trend is up, there are sustained periods of losses or break evenness and I think I need to handle these situations better. Truth be told considering the luck/variance that occurs in poker that chart is pretty good. In fact I feel personally I'm playing games to low and passing up potential profits in order to reduce the swings at the moment.




If I'm going to be managing large amounts of my own money, be it on an end of day or intraday trading system, I need to continue to develop the mental fortitude and recognize the 'process' rather than the mistake. I have a huge advantage over most because of my experiences but I'm not their yet.

I know I have positive expectancy in the games I play, just like in time I know I will have a positive expectancy in the market I trade. It's managing my emotions and continuing to play/trade well that is important. That and the 10,000 hours of experience.


----------



## kid hustlr

*Re: Beginner's Blog*




I watched SPI Open today on the booktrader for the first time. It was pretty cool there was lots of activity for the first 15 mins or so and then it went pretty quiet after that. It's the first time I've actually watched something like this in action.

I assume the '1 @ 4853' means there has been 1 contract traded at the price of 4853. (Last Price)

My reading of the screenshot above is 'there are 8 contracts worth of bids who are happy to buy at 4853 but there are currently no sellers below 4854'.

Effectively if you want to buy you either go up and hit the market at 4854 or get in line at 4853. Similarly if you want to sell you can get in line at 4854 or hit the market at 4853.

I remember when I used to use IRESS at work we could see what the buyer depth was at each level for each buyer, not just a sum of the buyers on that level. Is it possible to somehow view that using Interactive Brokers as well?


----------



## CanOz

*Re: Beginner's Blog*



kid hustlr said:


> View attachment 50677
> 
> 
> I watched SPI Open today on the booktrader for the first time. It was pretty cool there was lots of activity for the first 15 mins or so and then it went pretty quiet after that. It's the first time I've actually watched something like this in action.
> 
> I assume the '1 @ 4853' means there has been 1 contract traded at the price of 4853. (Last Price)
> 
> My reading of the screenshot above is 'there are 8 contracts worth of bids who are happy to buy at 4853 but there are currently no sellers below 4854'.
> 
> Effectively if you want to buy you either go up and hit the market at 4854 or get in line at 4853. Similarly if you want to sell you can get in line at 4854 or hit the market at 4853.
> 
> I remember when I used to use IRESS at work we could see what the buyer depth was at each level for each buyer, not just a sum of the buyers on that level. Is it possible to somehow view that using Interactive Brokers as well?




Like this? this is the Market Depth from IB for BHP a few minutes ago...


----------



## kid hustlr

*Re: Beginner's Blog*



CanOz said:


> Like this? this is the Market Depth from IB for BHP a few minutes ago...




Nuh that's not quite it Can.

What i mean is at price $37.76 for BHP it would line up:

Can Oz: 100 shares
kid hustlr: 50 shares
Trembling Hand 5000 shares

etc. etc.

Maybe I'm dreaming anyway and to be honest in faster moving futures markets its probably less of an issue or irrelevant all together. If you pro's don't need it I can't see why I would!

I'm finding the booktrader highly addictive fwiw.


----------



## CanOz

*Re: Beginner's Blog*



kid hustlr said:


> Nuh that's not quite it Can.
> 
> What i mean is at price $37.76 for BHP it would line up:
> 
> Can Oz: 100 shares
> kid hustlr: 50 shares
> Trembling Hand 5000 shares
> 
> etc. etc.
> 
> Maybe I'm dreaming anyway and to be honest in faster moving futures markets its probably less of an issue or irrelevant all together. If you pro's don't need it I can't see why I would!
> 
> I'm finding the booktrader highly addictive fwiw.




Yeah, i don't think IB has that level of detail for equity depth...

There are some great videos on YT from Jigsaw Trading on the DOM (book trader). He's just completed a series for TST. I think there are three videos all together. Also, some of John Grady's videos are on YT as well, look for nobsdaytrading. Guy Bower from Propex has some rippers on the SPI, look for Guy Bower.

Cheers,


CanOz


----------



## kid hustlr

*Re: Beginner's Blog*



CanOz said:


> Yeah, i don't think IB has that level of detail for equity depth...
> 
> There are some great videos on YT from Jigsaw Trading on the DOM (book trader). He's just completed a series for TST. I think there are three videos all together. Also, some of John Grady's videos are on YT as well, look for nobsdaytrading. Guy Bower from Propex has some rippers on the SPI, look for Guy Bower.
> 
> Cheers,
> 
> 
> CanOz




Yeah thinking about it more now there must be a way to view the buyer depth at each level otherwise how would you know where you are in the queue?

I'll check out those videos over the coming weeks when I have a chance cheers.


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> Yeah thinking about it more now there must be a way to view the buyer depth at each level otherwise how would you know where you are in the queue?




You don't.


----------



## kid hustlr

*Re: Beginner's Blog*



Trembling Hand said:


> You don't.




touche


----------



## kid hustlr

*Re: Beginner's Blog*

Well.

Long day.

After watching the open this morning I pretty much spent the rest of the day on ninjatrader using the ninja wizard. It's a powerful tool. I tried a variety of different systems and I'll continue to play around and get a feel for it however its going to take time. Little things comes up like how to place a certain type of stop or how to use xyz function and it just takes time to learn all these things.

I played around with 3 ideas for a system, the first was just a simple 'buy after 2 down days'. I only wanted to hold for one day and then sell at the close but Ninjatrader is kind of weird in that it sells you on the open of the next day. See example below (its a bad example actually). I'm sure there is a way to fix this.




I also tried a hard pivot system (long only) as well as an up key reversal strategy (long only) (seen here). Both are effectively playing on the concept of price patterns.

I think they both have a lot of potential and I like the idea of incorporating an RSI or something like that into them. Effectively it paints the picture of a set up into oversold territory on the RSI and the we get the pattern formation to confirm the buying support. Obviously all these things need a ton more work.

Overall though I'm definitely going to spend most of attention (initially atleast) on patterns. Anyone who seems to make money at this game seems to bad most of the indicators so I guess I should listen to them.


----------



## Trembling Hand

*Re: Beginner's Blog*



kid hustlr said:


> I only wanted to hold for one day and then sell at the close but Ninjatrader is kind of weird in that it sells you on the open of the next day.


----------



## kid hustlr

*Re: Beginner's Blog*



Trembling Hand said:


> View attachment 50689




Nuh that closes any open trades at the end of the test period. I want to exit on the close of the bar for each specific trade, not exit on the open of the bar after.


----------



## kid hustlr

*Re: Beginner's Blog*

Random Thoughts - The yield curve.

Outside of Year 12 and a few subjects at Uni, I don't know a whole lot about economics. I do know that the yield curve is an important indicator within the market and combined with a basic understanding of how bonds operate I think they can *really help* paint a long term picture of where the economy is heading. 

The chart below is something I came up with yesterday after playing around at the RBA's website. The red line is the spread between the 3yr and the 10yr Australian Bonds. Obviously when this number is below zero the yield curve is inverted. A lot of people note an inverted yield curve as a sign we are heading into a recession. Whilst that was the case a few years back, I also note how much profit you would have missed out on if you had sold all your holdings and went to cash the minute it turned negative.

The blue line is the ASX200.




The thing which struck me was how inverted the two lines are. What also struck me was how good the spread between the 3yr and the 10yr is at picking stock market bottoms. Effectively, as a long term investor, You should be looking to buy stocks when the spread between the 3yr and the 5yr is high and selling it when it is low. This makes sense in practice as well as a very high spread between the 3 and 10 yr suggests money is a lot cheaper now then it will be in 10 years time. As such you should borrow now and spend/invest it.

So the question is how can I use it?

I think the best way to use the chart is for confirmation at major peaks and troughs. Think of the spread as an oscillator. When the spread is very high, its a good time to buy stocks, when the spread is beginning to get low, be aware that the trend may be ending. 

Historically the spread also seems quite high. In my view long term investors should be buying.


----------



## kid hustlr

*Re: Beginner's Blog*

More food for thought.

The Recent Bang has been coming for a while. Sometimes not everything lines up as planned but few can argue that the recent trend hasn't been up up and away.

It's been noted by many before me who know a lot more about this game that much of the day session is spent filling overnight gaps and range trading. This is also true of the SPI (probably moreso than others..) yet lately something changed.

See chart below.

Through most of January it did it's usual thing where it would gap up and then fill it during the day. Yet on the 21st something happened, and despite its best the bears best efforts over the next couple of days they couldn't close that gap. And of she goes.

This is definitely something i need to keep an eye on in the future.


----------



## Joe Blow

kid hustlr, I have renamed your thread so that those who come across it will know that it is a beginner's *trading* blog. The fact that it is in this particular forum (Trading Strategies/Systems) is already a clue but you might get some additional views from those searching for trading related threads both on ASF and from those who hit the site directly from Google.


----------



## kid hustlr

Joe Blow said:


> kid hustlr, I have renamed your thread so that those who come across it will know that it is a beginner's *trading* blog. The fact that it is in this particular forum (Trading Strategies/Systems) is already a clue but you might get some additional views from those searching for trading related threads both on ASF and from those who hit the site directly from Google.




tx Joe


----------



## kid hustlr

I watched the open on the SPI again this morning. Overnight it was one way traffic heading south so I was interested to see if the trend bucked when the day session opened.

It kept a pretty tight range leading into the open but I did pick up a couple of things. I wish I had taped it so I could go look at it again some other time. (Mental note to do this).

1. the bid and ask size didn't seem to matter that much. When we were at support at the lows and I thought some accumulation was forming, it didn't actually take that much to blow through it. The 'bid size' was stacked with with like 200 lot parcels at all levels but it looked like they got pulled pretty quickly when we challenged those levels. A number of those bids were definitely removed.

2. Whenever the highest bid is below the last traded I feel the next move will be down and vica versa. This is because in that example if someone wanted to sell and jump the queue they would need to go down a level to the highest bid. I'm not sure if this helps me in the slightest as I feel it would be too hard to scalp given the speed of the moves and the queue position needed.

So many thoughts!


----------



## tech/a

> *So many thoughts*!




Its a common trait for all who start.
Attempting to predict the next 5 mins.

Seriously this is a futile road for most to follow.
Some like T/H here enjoy the battle and are in the
top 3 % after years of experience.

Personally I'm a snail.Prefering time to myself and sanity.
below is an example of my trading--currently.

https://www.aussiestockforums.com/forums/showthread.php?t=17461&page=64


----------



## Trembling Hand

tech/a said:


> Its a common trait for all who start.
> Attempting to predict the next 5 mins.
> 
> Seriously this is a futile road for most to follow.
> Some like T/H here enjoy the battle and are in the
> top 3 % after years of experience.
> 
> Personally I'm a snail. Prefering time to myself and sanity.
> below is an example of my trading--currently.




Oh I agree you will go nutz trying to get a positive R:R in a 5 minute trade, especially something like the SPI.


----------



## kid hustlr

Cheers guys.

Just trying to master this game. I recognise there is a difference between intraday stuff and longer term trades. Doesn't mean i cant master them both!

Agreed the SPI isnt the best thing to watch although there is decent activity on the open.

SCREEN TIME!


----------



## CanOz

kid hustlr said:


> Cheers guys.
> 
> Just trying to master this game. I recognise there is a difference between intraday stuff and longer term trades. Doesn't mean i cant master them both!
> 
> Agreed the SPI isnt the best thing to watch although there is decent activity on the open.
> 
> SCREEN TIME!




What other Asian data do you have access to Kid?


----------



## kid hustlr

CanOz said:


> What other Asian data do you have access to Kid?




At this stage none.

I need to check if IB offers any other free data.

If they don't then I'll most likely jump into this blog and ask for help on where I can find some free DOM's to study!


----------



## CanOz

kid hustlr said:


> At this stage none.
> 
> I need to check if IB offers any other free data.
> 
> If they don't then I'll most likely jump into this blog and ask for help on where I can find some free DOM's to study!




I've got a ton of US markets for free, with AMP Clearing. Most of the fees for US markets are waived if you have an account with a broker.

CanOz


----------



## kid hustlr

CanOz said:


> I've got a ton of US markets for free, with AMP Clearing. Most of the fees for US markets are waived if you have an account with a broker.
> 
> CanOz




Cheers TH I will investigate. It's one of the many things on my 'to do' list.

Still keeping an eye on this chart. Divergences themselves aren't the be all and end all and this is only one study of market breadth yet it is still of some concern for out market. As many have said perhaps just a warning.


----------



## kid hustlr

Interesting to see BHP turned around so quickly at resistance. $38 has been a line in the sand for a while now.




All indexes and sub-indexes still looking relatively healthy overall though so I don't think it's time to panic just yet.

Also a little bit of buying support through out the day today with the Australia Day gap continuing to be well defended.


----------



## kid hustlr

So I want to have a look at the depth on some future's contracts.

I've got an account with IB and the Sydney Future's exchange is free so the SPI is ok (and I have that working.

I'm a little confused as to what contracts trade on what exchanges though. Some help here would be appreciated.

http://individuals.interactivebrokers.com/en/index.php?f=marketData&p=mdata#asia
That's the link for the market data costs with IB.

Am I reading that correctly that I could sign up for SGX data for only $1 and that would allow me to trade both the Nikkie and the Taiwan Index Future?

Just confused as to what contracts trade with what exchanges.


----------



## kid hustlr

kid hustlr said:


> So I want to have a look at the depth on some future's contracts.
> 
> I've got an account with IB and the Sydney Future's exchange is free so the SPI is ok (and I have that working.
> 
> I'm a little confused as to what contracts trade on what exchanges though. Some help here would be appreciated.
> 
> http://individuals.interactivebrokers.com/en/index.php?f=marketData&p=mdata#asia
> That's the link for the market data costs with IB.
> 
> Am I reading that correctly that I could sign up for SGX data for only $1 and that would allow me to trade both the Nikkie and the Taiwan Index Future?
> 
> Just confused as to what contracts trade with what exchanges.




Think I've got this sorted, looks like a lot of contracts trade on more than one exchange.


----------



## kid hustlr

Had some time this morning so decided to see if I could predict the future.

We are going to open right at the highs after a strong session overnight. I tend to favor a a fall back from the open in typical 'fill the gap' style and then from there who knows. It's pretty rare from a gap up that you keep going into further highs and I still think this market will 'catch its breath' for a little bit longer before taking the next step up. 




Also interesting to see the AUD come away over the recent weeks. I guess this will continue to provide support for our market.


----------



## peterfootwork

kid hustlr said:


> Had some time this morning so decided to see if I could predict the future.
> 
> We are going to open right at the highs after a strong session overnight. I tend to favor a a fall back from the open in typical 'fill the gap' style and then from there who knows. It's pretty rare from a gap up that you keep going into further highs and I still think this market will 'catch its breath' for a little bit longer before taking the next step up.
> 
> View attachment 50933
> 
> 
> Also interesting to see the AUD come away over the recent weeks. I guess this will continue to provide support for our market.




So how do you think you went???


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## kid hustlr

peterfootwork said:


> So how do you think you went???




Heh I killed it didn't I.




Doesn't mean I would have made any money trading the snail trail. Still have no idea what I should be looking for in the depth screen.


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## kid hustlr

Found this video really interesting.

https://www.youtube.com/watch?v=vcsMaS78QRE

Apologies I don't know how to embed.

The concept of 'fair value' is one which has always interested me and it was interesting to see someone make some money from the idea. I remember in the International Banter thread a couple of weeks ago there was some discussion about how the HSI Index had gotten away from the Futures and I was shocked that this could happen.

I always figured that whenever the spread between the two became too wide/narrow bot's would just step in and buy the index/sell the future or vica versa and make the arbitrage money. I guess in a thin a market like the HSI this is easier said than done.

In regards to the SPI and the and the ASX200 I assume it keeps pretty much in line as both markets are pretty liquid and there seems to be bots everywhere to take advantage of any 'price gaps'.

From a practical trading perspective, even if the spread widens/narrows beyond what it should, that doesn't necessarily give a trade opportunity as your average retail trader doesn't have access to both buy the entire index of stocks and sell the future, it may however provide another 'clue' as to what may happen next.

I think what makes this example so 'riskless' is that the stock market has closed but has not settled. 

The only risks I can see to a trade like that is: 

1. The closing auction for stocks is greatly different to what the last traded prices were - this is pretty unlikely
2. For some unknown reason the spread between future's and the index doesn't return to fair value - something which I also think is pretty unlikely.

If I've missed the point completely I'd love someone to step in and let me know but I think I have a pretty good handle on it.


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## skc

kid hustlr said:


> In regards to the SPI and the and the ASX200 I assume it keeps pretty much in line as both markets are pretty liquid and there seems to be bots everywhere to take advantage of any 'price gaps'.
> 
> From a practical trading perspective, even if the spread widens/narrows beyond what it should, that doesn't necessarily give a trade opportunity as your average retail trader doesn't have access to both buy the entire index of stocks and sell the future, it may however provide another 'clue' as to what may happen next.




Here's a thread showing the results of my 3 month arbitrage game with 2 CFD providers... unfortunately the way they price the instruments has changed and so this is no longer possible.

https://www.aussiestockforums.com/forums/showthread.php?t=14588

I like your thinking and the fact that you crsytalised and structured your thoughts by writing them all down. Sometimes the market can be cracked simply with good application of creative thinking and logic.


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## kid hustlr

skc said:


> Here's a thread showing the results of my 3 month arbitrage game with 2 CFD providers... unfortunately the way they price the instruments has changed and so this is no longer possible.
> 
> https://www.aussiestockforums.com/forums/showthread.php?t=14588
> 
> I like your thinking and the fact that you crsytalised and structured your thoughts by writing them all down. Sometimes the market can be cracked simply with good application of creative thinking and logic.




Nice to know you're reading SKC.

Whenever I read something like that link (nice work by the way) I always think of Reminiscences where he used to call the exchange and sell a stock, then buy the stock at 5 different bucket shops and then finally buy the stock back at the exchange later in the day to take the shops for a ride.


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## kid hustlr

This guy is a boss

http://www.nobsdaytrading.com/video-samples/

I'm actually gonna pony up the 50 bucks for the beginner course or w/e. Really Really enjoyed those sample videos.

Also made me realise how ridiculous the SPI is compared to a real market.


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## kid hustlr

Really interesting action in the SPI just before, will write it up tonight as I think it's a good lesson


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## CanOz

kid hustlr said:


> *This guy is a boss*
> 
> http://www.nobsdaytrading.com/video-samples/
> 
> I'm actually gonna pony up the 50 bucks for the beginner course or w/e. Really Really enjoyed those sample videos.
> 
> Also made me realise how ridiculous the SPI is compared to a real market.




Yup, sure is....Can't go wrong with his stuff mate.


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## kid hustlr

kid hustlr said:


> Really interesting action in the SPI just before, will write it up tonight as I think it's a good lesson




Just on this.

I know supply and demand are not static and that overtime area's move. That being said various areas can definitely be used to provide context.

Below is the 30 min chart for the SPI. Noting that we've had an upward bias in the market, its important to note where the major areas of decision are. Quite often these areas aren't 'clean or obvious' but we can look at how often the resistance has been tested in order to get a feel. In each important area of the chart the resistance has been tested _multiple times_. It's not just some random area or random high but rather an area of indecision which has has been attacked and defended more than once. When/If it cracks it figures to have some upside potential.




Now we have the 5 min chart from today. Once again note the context:

-CBA announces strong profits and opens up 3%
- We are in earning season
- 4960 in the SPI contract equates to roughly 5000 in the XJO
- The market is in an uptrend
- We had had 2 tight range days. High volatility follows low volatility.

After the initial push at the open we made a run for 4960 (5000 on the index). After the initial touch at about 10.45 we faded back however the bulls were always in control. I only got to see the depth for about 20 minutes (And this is what really does matter) but just after 10.45 but I remember thinking that I thought any push down was getting quickly eaten by the bulls. Whenever the Ask pushed down it just kept getting gobbled up. No surprise that we tested the high again and the cross over the magic line will generally provide some upside.






Maybe I'm looking too much into this or over analyzing. After all from what I gather not many locals trade the SPI and it's generally a slow moving, computer based market but some techniques definitely work in this market and much can be learned.

At least I think that's what I'm doing


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## kid hustlr

Still lost on why the volume data I get from Interactive Brokers is so different to that of what the ASX spits out in their trading report. If by miracle someone can answer this, please do!




Why is it different??!!


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## skyQuake

Not sure, but the SFE one matches what I have


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## kid hustlr

skyQuake said:


> Not sure, but the SFE one matches what I have




ta mate,

I guess it's an Interactive Brokers thing then.


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## kid hustlr

Open 15/2/13

Not expecting a whole lot of action today.

Context:
-It was quiet overnight
-We've had two strong days in a row, perhaps time for some gentle rotation.
-Not really any news coming out although RIO did report after the close y/d so perhaps that will move the market a little.

The night session closed down 7 points or so. Given I'm not expecting a whole lot I'm leaning towards a leak towards the 4970 mark, if not maybe we test yesterdays highs. In the end the tape will tellthe story.

Chart below shows a couple of support and resistance levels, also note the ASX200 index at 5000 = the SPI Futures at around the 4955-4960 mark, I wouldn't be surprised if that level provides some support in the coming days/months/whenever. Then again maybe it won't.




Anyone else view the idea of BHP/RIO increasing their dividend as a bad thing? I mean these big miners are supposed to use their excess cashflow to go out and seek and develop more projects and actually provide a strong return. To me these guys paying a higher dividend is saying 'we can't find anything to spend our capital on so we are just going to give it back to the shareholder'


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## kid hustlr

Monday:

Still no word from Interactive Brokers about the volume issue for the SPI.

So we closed at 4995 on Friday afternoon got up to 5016 in overnight trading then closed at 5008.

Both CBA and TLS go ex-div today. My understanding of this is that the SPI/Cash fair value was about 42 points all through Friday, given the dividends coming out of the cash I'd say this spread will narrow to about 30 (rough calc's). What this means is even though the SPI was +13 from the close on Friday afternoon I think the cash market will open little changed. This is my understanding of how it will work but will keep a close eye this morning to verify.

Unsure what to make of the open, 4980-4985 are the levels I'd be expecting some buying to come in. I noted to myself on Friday that these areas had the most traded volume. Everything still points to buy the dips at this stage.

I do note that on Friday though the high was just above 5000 and it printed a pretty strong reversal on the 30 min chart. This also co-incided with a slightly lower high when compared to Thursdays price action. I'm not reading too much into it at this stage though.

Will be doing my best to follow the depth!


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## kid hustlr

Feeling good today. I feel organised.

Effectively in this game I want to acheive two things:

1. Make a lot of money.

2. Manage that money well.

In regards to 1, making a lot of money for me either comes from getting a job and working hard, or learning to intraday trade and be successful that way. At this stage I'm hoping I can prove myself to become a strong enough trader that it can be my 'job'. Only time will tell on this front and whilst I have several avenues on how this can be achieved, they all involve watching the screen a great deal and learning what works. Some luck along the way wouldn't hurt either to be honest.

I've now got the ES, NQ, NKD and AP all set up with Interactive brokers so I can watch several markets at various times of the day and attempt to learn what works. I think this is a good base.

I'm also going to be backtesting some ideas on the above instruments through Ninjatrader. Once again, I'm trying to find what works or atleast give myself some type of an edge.

With regards to part 2, managing the money. I think this where the portfolio management/nick radge/learn to code in amibroker comes into play. Obviously this is a long enough road itself and trying to both at the same time isn't easy although if I'm ever going to have time to do both its now. So improve on this front I need to d/l amibroker, learn how to use it, then learn to VALIDATE some of Nick's systems as well as perhaps come up with some concepts of my own. As I said, its a long road and I'm jealous of those who have already done it.

If I get enough money from (1) then maybe I'll just join the growth portfolio haha.

Well all that sounds pretty easy when you write it down. Now its just a time thing.


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## tech/a

No its a *MONEY THING*

Then its a time thing

To make lots of money youll need to trade lots of Contracts
So youll need lots of margin 
So youll need lots of cash to provide that margin particularly if trading 
lots of instruments.
Around $100k would be the minimum if you want good return.
Twice that for a chance at serious money.


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## kid hustlr

tech/a said:


> No its a *MONEY THING*
> 
> Then its a time thing
> 
> To make lots of money youll need to trade lots of Contracts
> So youll need lots of margin
> So youll need lots of cash to provide that margin particularly if trading
> lots of instruments.
> Around $100k would be the minimum if you want good return.
> Twice that for a chance at serious money.




There are ways of acquiring currency tech.

Agreed you need a strong starting capital base but that's the least of my worries considering i dont have a positive expectancy to even trade it yet!


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## kid hustlr

So yesterday all the SPI wanted to do was run, so naturally today I looked for breakouts only to run into a day of mean reversion.

Glad its on the SIM!


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## kid hustlr

Got up this morning and caught the last 2 hours of the US markets.

So glad I did.

Had the ES and the NQ ladders up and that was it. I really like the NQ it seems to be a more volatile version of the S&P and I feel like there is some lead/lag benefits of having them both there. I can also use them for confirmation.

As far as sim trades went my first couple were for small losses but I was actually pretty happy with them. Both times I shorted the ES and I felt like my reasons each time were good. It wasn't as if I was just clicking buttons and I think the risk/reward set ups on them were good.

Then in the last 30 mins or both the ES and the NQ both went bonkers, the NQ especially as they just smashed through to the highs of the day. I actually picked up 2 4 tick trades on the NQ but I must have fat fingered or something because next thing I knew I was in another trade on the NQ and it took me a minute or 2 to work out what had happened, as a result I gave back most of the profit.

Anyway next stop is the SPI at 10 oclock although I must say it's definitely not my preferred instrument. Then I'll watch the Nikkei at 12.

Does anyone have any suggestions about other ladders I can have up whilst trading the SPI? I was thinking maybe the AUD/USD or something? Same question goes for the NIkkei maybe the USD/JPY?


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## kid hustlr

A couple of big companies reporting today as well as a couple of economic indicators coming out. I guess wage prices at 11.30 is the biggest but I wouldn't know to be honest.

I think BHP and WPL is the big news today.

Yesterdays cash hours high was 5064, 5056 would also provide some support it seems if we go for the morning gap fill however I'm not sure me sitting here and trying to guess which way we will go today will achieve anything. 

On a longer term basis all the sub index's look healthy, you would think there has to be some profit taking on the XFJ soon but I've been thinking that for a while!


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## kid hustlr

Another day.

Couldn't really look at the US markets this morning but I did see the last few mins of trade, looked pretty ugly for all the longs.

Plan today is to not trade the SPI. I'm going to continue to search around for volatile markets on the Asian time zone. I know the HSI is pretty lively but I wan't to check out all the other ones first. I really do find the slow markets, the SFE bonds just dont move, the SPI seems really slow, even the NK has been a little slow for my liking. maybe I'm just being picky but when I compare these markets to the NQ and the ES there is just no comparison.

It's a shame the SPI is so boring because it's definitely the market I know the most about and I can do the most 'context' work for it, that being said maybe I should just worry about reading the tape.

Plan is to stick with STW today and see how I like it, once I get a feel for an asian market which I enjoy then I'll stick to just one of them but until then I'll just practice reading depth across a range of different tapes.

Dont know what happened at the close of the NQ but looks like one seller got owned.


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## captain black

kid hustlr said:


> Plan today is to not trade the SPI. I'm going to continue to search around for volatile markets on the Asian time zone. I know the HSI is pretty lively but I wan't to check out all the other ones first. I really do find the slow markets, the SFE bonds just dont move, the SPI seems really slow, even the NK has been a little slow for my liking. maybe I'm just being picky but when I compare these markets to the NQ and the ES there is just no comparison.
> 
> It's a shame the SPI is so boring because it's definitely the market I know the most about and I can do the most 'context' work for it, that being said maybe I should just worry about reading the tape.
> 
> Plan is to stick with STW today and see how I like it, once I get a feel for an asian market which I enjoy then I'll stick to just one of them but until then I'll just practice reading depth across a range of different tapes.




I did the same thing you're doing now a few years ago and found the Kospi worked best for me. Might be worth a look. Opens at 10:30 am and closes just after 4:30 pm (SA daylight savings time). I'm a swing trader and pick up some good swings most days. Days like yesterday where it's all one way traffic are difficult to swing trade but if you can learn to recognise early that it's a trend day then you can adjust your trading style to suit.


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## theinvestorguru

Hi Kid Husler

Very good thread, I m newbie. Similar to your situation a year ago, just start reading for Stan Weinstein and Dave Landry, using free version of prorealtime program, and opened optionsxpress account as well.

I didnot thought it is that hard to trade, but I m displayed and happy to spend the months and years in learning, I wish I can cut the learning stage to level start to make some money in one year. 

Did you trade options? What do u think best start in paper trading or really starting the trade? Is 2000-5000 enough

Thanks


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## Trembling Hand

theinvestorguru said:


> Did you trade options? What do u think best start in paper trading or really starting the trade? Is 2000-5000 enough
> 
> Thanks




Why are you starting with options? Especially with so little capital. Thats a long way from anything that looks ideal.


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## kid hustlr

theinvestorguru,

I haven't intra-day traded with real money yet. I plan to soonish. I have never traded options, they seem far more complex. With regards to starting capital, generally the more the better. 5k seems too low. I'd spend $100 bucks on a couple of*good* books then come back in 3 months time when you have more money behind you.

Captain,

Agreed, I watched the Kospi on Friday and it seemed pretty thick and liquid. Also looks to have a bit of action which I like. Granted markets change over time and I've only got a small sample of viewing time on the Kospi but it looks to be a winner if I choose to trade intra day on the asian time zone. Take all these remarks with a grain of salt because as I've said I've only had a good look at the intra day activity over the last week or so. Any market I choose to trade with my capital I'll do a lot more research into things like average trading range, commissions etc etc. 

This week is going to be pretty quiet on the trading front, a couple of things have come up which I need to attend to.

Finished the NO BS basic course today. I highly recommend for anyone considering trading futures.


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## theinvestorguru

Trembling Hand said:


> Why are you starting with options? Especially with so little capital. Thats a long way from anything that looks ideal.




Hi trembling Hand,

I m thinking of trading options as less money needed, there are more risky , I do know that.
I m still reading about stock, as I need to predict thre direction with T/A and fundamental A. 
I m reading way to trade them, I m thinking I will do spreads in them.
For me at this this stage( still reading and not practicing) it is similar to go long or short of the share itself with less money and less time to reach target sell.
I will do at least 3-6 months paper trading to test my strategy 

You seem do not like option trading, is it the risk that you do not like or something else

Thank you very much for the post


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## tech/a

theinvestorguru said:


> Hi trembling Hand,
> 
> I m thinking of trading options as less money needed, there are more risky , I do know that.
> I m still reading about stock, as I need to predict thre direction with T/A and fundamental A.
> I m reading way to trade them, I m thinking I will do spreads in them.
> For me at this this stage( still reading and not practicing) it is similar to go long or short of the share itself with less money and less time to reach target sell.
> I will do at least 3-6 months paper trading to test my strategy
> 
> You seem do not like option trading, is it the risk that you do not like or something else
> 
> Thank you very much for the post




*Why???* do you call yourself theinvestorguru?


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## theinvestorguru

tech/a said:


> *Why???* do you call yourself theinvestorguru?




Hi Tech/a,

Good q, I call myself theinvestorguru because this is where I want to be in nov 2015. I set goal to learn to trade stocks , and use stock as long term investment vehicles , and property investment as well. 

I went to course online  on wealth creation, after we set goals,short,medium, long  term, personal and proffisional with choosing our rolls in each of them, so one of them was myself being theinvestorguru.  Plan is to use 10% of income for the compound effect and diversification of wealth

I am big fan of your post, although donot understand some of the t/a specific strategies yet.  I started to like the T/a and I think iris way to go in trading stocks.

Good luck for all


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## Trembling Hand

theinvestorguru said:


> Hi trembling Hand,
> 
> I m thinking of trading options as less money needed,




I'm sorry but you have that wrong. You're not likely to get far that way.


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## theinvestorguru

Trembling Hand said:


> I'm sorry but you have that wrong. You're not likely to get far that way.




Hi Trembling HAnd,

I m not sure what do u mean? Do u mean need more money to start with, financially I am able to start up to 20 k but I m worried that I will loss them all.

Can you please give more specific adv, I would highly appreciate your time thank you


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## Trembling Hand

theinvestorguru said:


> Hi Trembling HAnd,
> 
> I m not sure what do u mean? Do u mean need more money to start with, financially I am able to start up to 20 k but I m worried that I will loss them all.
> 
> Can you please give more specific adv, I would highly appreciate your time thank you




You are attracted to options only because you can control 100 BHP shares for a next to no capital - that is the reason you are looking at them. BUT you cannot position size your trade, you expenses with the spread are massive, the  option delta is less than 1 so even good ideas/trades don't payout, a few moves against you will destroy your inadequate capital and on and on.

Basically you are thinking about options because you know absolutely nothing about trading and correct practical application of trading - just the idea of leverage seems to good to pass up. IMHO.


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## theinvestorguru

Trembling Hand said:


> You are attracted to options only because you can control 100 BHP shares for a next to no capital - that is the reason you are looking at them. BUT you cannot position size your trade, you expenses with the spread are massive, the  option delta is less than 1 so even good ideas/trades don't payout, a few moves against you will destroy your inadequate capital and on and on.
> 
> Basically you are thinking about options because you know absolutely nothing about trading and correct practical application of trading - just the idea of leverage seems to good to pass up. IMHO.




Hi 

Thank you for the adv, you are right in term I m looking for better leverage doing options,and I do not have experience ( at all). Hmmm, I will start in stocks which is still big deal to master it. 

Thank you for the adv.


----------

