Dump it Here

[Skate]

Making assumptions
It's extremely hard to get a point across so others understand when the topic has any degree of complexity. Making assumptions or jumping to a conclusion never helps. Also, it might take some time to understand what is being presented. Alternative views are always welcomed.



Skate.

 

[Skate]

Forming an opinion is important
Our expectations, assumptions & perceptions shape the way we trade in ways that some will never understand. Our brain is constantly assessing & re-assessing only information that matches our (beliefs) & blocks out the rest. This is why when experienced traders take the time to express an idea from their own trading experience, it's worthy of a second read.

Our perception
Shapes what we want to read & what we want to hear or learn. Our expectations, assumptions & perceptions shape our views on many things & just not trading.

Skate.

 

[ducati916]

Making assumptions
It's extremely hard to get a point across so others understand when the topic has any degree of complexity. Making assumptions or jumping to a conclusion never helps. Also, it might take some time to understand what is being presented. Alternative views are always welcomed.

View attachment 150329

Skate.

If markets are complex systems, which they are, then traders/investors tend toward 'dimension reduction'. More plainly, causality and narrativity, which both lead to chronology and a perception of events in the flow of time. Often, wildly inaccurate.

This disease, leads to many pathologies in the market. One example is the interpretation (of let's say a price chart) and projecting it forward in time. The expectation (absent any quantitative assessment) that price will perform in 'X' manner. If successful, a causality/narrative is assigned as to why this succeeded: bounced off of VWAP, expansion of vol, etc. This can be very dangerous to our intrepid trader/investor.

Of course this narrative/causality or dimension reduction is present in many different forms, depending on who or what you are paying attention to. Consumption of information must be (preferably) limited or subjected to very stringent cynicism, lest something dirty get through.

A quantitative approach, while not always successful to the highest positive expectancy, nevertheless, is positive or profitable over time, assuming of course that the trader/investor follows their own set of rules and calculations.

I'm not conversant with how Mr Skate runs his strategies, but they have been demonstrated to be successful in real time. I run 2 strategies: (i) is based on simple arithmetic, (ii) is based on calculus. The third is not a quantitative strategy at all, more based on history. Which makes this strategy the most subjective of all. The first 2 are simply based on and executed on, numbers that are generated via market prices and time. There is no attempt to interpret, understand, or apply causality to those numbers. Strategy 3 is all about trying to apply causality and an understanding of the macro-environment.



jog on
duc

 

[Skate]

a perception of events in the flow of time. Often, wildly inaccurate.

@ducati916 combining the two makes a perfect statement of fact
"A perception of events in the flow of time [are] often wildly inaccurate".

Traders are risk managers & decision-makers
The point of the previous series of posts was to explain why the level of risk you choose can determine how long it can take to blow up a trading account.

The psychological side of risk
Trading with a lower risk will keep emotions in check by keeping losses limited, as a larger drawdown might influence a future trading decision. In reality, mathematics becomes less relevant when emotions are involved. The more risk you take on the quicker your trading account can be destroyed.

Dollars do have an emotional pull
When you find yourself with a big dollar loss, you could be tempted to start risking more to win some of those losing dollars back, which in turn "could kill" an account over time. So it's better, in the long run, to concentrate on capital preservation by managing a losing streak before it hurts more than a few percentage points.

Skate.

 

[Skate]

As traders we all make mistakes
So don’t make taking “excess risk” one of them. If you think a large drawdown in the range of 20-30% is normal, then at what point do you start to think something's wrong? Take it from me, you’ll buckle to "emotional pressures" when a large chunk of your trading funds are gone. (that's a given) I’m trying to promote a realistic approach for new traders to understand the importance of risk when they are just starting out on their trading journey.

There are a few old sayings
I'm paraphrasing these from memory, so forgive me if they are wrong.

1. New traders focus on what they "can make" whereas seasoned traders focus on what they "could lose.”.
2. There are old traders & there are bold traders, but there are no "old bold traders".

Skate.

 

[Skate]

Self praise
"Self praise is no recommendation"

Two-year equity curve
An equity curve that's gone nowhere in 2 years indicates how hard trading has been, even for those who are considered to be the best.



Skate.

 

[Skate]

Trading has been tough
It's pleasing when other members make a post. When @ducati916 makes a post I take notice, as he is one member whose views are always "on the money" giving us a window into his thoughts.

When you get the exit strategy wrong
A shoddy exit means you will accumulate a large dollar drawdown, the dread of all traders. Getting the exit just right baffles even the best of traders & it's still the hardest part of trading. Looking at an equity curve for the last few years raises the questions (a) when is it safe to enter the markets & (b) why the timing of the exit is critical to the "profitability" of any trading plan.

Skate.

 

[ducati916]

If markets are complex systems, which they are, then traders/investors tend toward 'dimension reduction'. More plainly, causality and narrativity, which both lead to chronology and a perception of events in the flow of time. Often, wildly inaccurate.

This disease, leads to many pathologies in the market. One example is the interpretation (of let's say a price chart) and projecting it forward in time. The expectation (absent any quantitative assessment) that price will perform in 'X' manner. If successful, a causality/narrative is assigned as to why this succeeded: bounced off of VWAP, expansion of vol, etc. This can be very dangerous to our intrepid trader/investor.

Of course this narrative/causality or dimension reduction is present in many different forms, depending on who or what you are paying attention to. Consumption of information must be (preferably) limited or subjected to very stringent cynicism, lest something dirty get through.

A quantitative approach, while not always successful to the highest positive expectancy, nevertheless, is positive or profitable over time, assuming of course that the trader/investor follows their own set of rules and calculations.

I'm not conversant with how Mr Skate runs his strategies, but they have been demonstrated to be successful in real time. I run 2 strategies: (i) is based on simple arithmetic, (ii) is based on calculus. The third is not a quantitative strategy at all, more based on history. Which makes this strategy the most subjective of all. The first 2 are simply based on and executed on, numbers that are generated via market prices and time. There is no attempt to interpret, understand, or apply causality to those numbers. Strategy 3 is all about trying to apply causality and an understanding of the macro-environment.



jog on
duc

So a text book example:



Now unless you were willing to spend an inordinate amount of time with the financials, which would likely be subject to all the usual accounting tricks, then what you have left is the 'price' and the 'narrative' which assigns a causation.

jog on
duc

 

[Rabbithop]

So a text book example:

View attachment 150360

Now unless you were willing to spend an inordinate amount of time with the financials, which would likely be subject to all the usual accounting tricks, then what you have left is the 'price' and the 'narrative' which assigns a causation.

jog on
duc

Good morning All and Thank you all posters on this Thread. Its worth re reading to comprehend and learning smart from the Gurus here.
So far, I am impressed how we have shared, trashed out our opinions here in true gentleman manner unlike in another Forum where personal insults n attacks wld have been bombarded by now.

The below I am going to post is from my re reading this Thread n couldn't help myself from laughing while comparing to another matter currently circulating in my head..No insult intended just trying to find the right answers to help others in trouble time

We all love hearing & watching train wrecks
You hear it all the time. "Well, this week didn't go as expected" without giving a second thought as to why. There are traders at the moment holding shares whilst the markets are in free fall. Some have outwardly justified that they are not worried exclaiming they are in it for the long haul so they haven’t sold anything yet "even justifying "that it's too late to sell now" & (that was a week ago) while others have responded by declaring "I've held these positions this long I might as well keep holding them".

Its similar to victims of spouse abusers in marriage voicing it loud...we hear it all the time...this week didn't go as expected..married couples holding on to marriage whilst the marriage in free fall...some have outwardly justified that they are not worried exclaiming that are in for the long haul so they haven't divorce yet....even justifying...that it's too late to get out now...while others have responded by declaring...I've held this marriage this long I might as well keep holding it...

Ah...as Skate posted ...it's what in our mind n how we perceived it..

The answer I discovered..Get Out Before You Are Dead...For Traders n Others in Trouble Marriages.

Gotta get ready for Urologist appt, pray he will decide to blast that urtheral stone out before the year end instead of putting a stent, delaying until next year.

 

[Skate]

Nature at its very best
My proud son just snapped this from a tree in his yard. I'm absolutely flabbergasted at its beauty.



Skate.

 

[Rabbithop]

Nature at its very best
My proud son just snapped this from a tree in his yard. I'm absolutely flabbergasted at its beauty.

View attachment 150372

Skate.

Beautiful Fragipani flower

 

[farmerge]

Good morning All and Thank you all posters on this Thread. Its worth re reading to comprehend and learning smart from the Gurus here.
So far, I am impressed how we have shared, trashed out our opinions here in true gentleman manner unlike in another Forum where personal insults n attacks wld have been bombarded by now.

The below I am going to post is from my re reading this Thread n couldn't help myself from laughing while comparing to another matter currently circulating in my head..No insult intended just trying to find the right answers to help others in trouble time

We all love hearing & watching train wrecks
You hear it all the time. "Well, this week didn't go as expected" without giving a second thought as to why. There are traders at the moment holding shares whilst the markets are in free fall. Some have outwardly justified that they are not worried exclaiming they are in it for the long haul so they haven’t sold anything yet "even justifying "that it's too late to sell now" & (that was a week ago) while others have responded by declaring "I've held these positions this long I might as well keep holding them".

Its similar to victims of spouse abusers in marriage voicing it loud...we hear it all the time...this week didn't go as expected..married couples holding on to marriage whilst the marriage in free fall...some have outwardly justified that they are not worried exclaiming that are in for the long haul so they haven't divorce yet....even justifying...that it's too late to get out now...while others have responded by declaring...I've held this marriage this long I might as well keep holding it...

Ah...as Skate posted ...it's what in our mind n how we perceived it..

The answer I discovered..Get Out Before You Are Dead...For Traders n Others in Trouble Marriages.

Gotta get ready for Urologist appt, pray he will decide to blast that urtheral stone out before the year end instead of putting a stent, delaying until next year.

Arvo to you Rabbito. Best of luck with the medical procedure, hope that it goes to your perceived plan

 

[Rabbithop]

Arvo to you Rabbito. Best of luck with the medical procedure, hope that Arvo to you Rabbito. Best of luck with the medical procedure, hope that it goes to your perceived plan

Good day farmerge. Prayer answered. He is going to do my surgery next Mon even though he is fully booked. Had been running around today doing blood, urine n CT scan update for surgery.

 

[rcw1]

Good day farmerge. Prayer answered. He is going to do my surgery next Mon even though he is fully booked. Had been running around today doing blood, urine n CT scan update for surgery.

Great news Rabbithop
Kind regards
rcw1

 

[farmerge]

Good day farmerge. Prayer answered. He is going to do my surgery next Mon even though he is fully booked. Had been running around today doing blood, urine n CT scan update for surgery

Good day farmerge. Prayer answered. He is going to do my surgery next Mon even though he is fully booked. Had been running around today doing blood, urine n CT scan update for surgery.

Rabbito I concur with rcw1

 

[Skate]

I'm feeling the pressure
Being the custodian of $20k & having that money sitting on the sidelines waiting to time the market has put a lot of pressure on my shoulders. Unless you are retired, everyone else is time-poor. Being time-poor & trading such a low dollar amount of $20k is a challenge for everyone.

Not everyone "knows" the risk of trading with small amounts
Waiting is one of the hardest parts of trading & it's even harder when you are just starting out, being eager to have a go. I'm always on the lookout for new ideas to post about that may be helpful to others. This gives me an opportunity to make a series of posts about "how you go about trading with small amounts of money".

Skate.

 

[farmerge]

I'm feeling the pressure
Being the custodian of $20k & having that money sitting on the sidelines waiting to time the market has put a lot of pressure on my shoulders. Unless you are retired, everyone else is time-poor. Being time-poor & trading such a low dollar amount of $20k is a challenge for everyone.

Not everyone "knows" the risk of trading with small amounts
Waiting is one of the hardest parts of trading & it's even harder when you are just starting out, being eager to have a go. I'm always on the lookout for new ideas to post about that may be helpful to others. This gives me an opportunity to make a series of posts about "how you go about trading with small amounts of money".

Skate.

Good morning Skate Very true your thoughts on trading. Though I don't have the time I did from a couple of years ago, I have found that my tried and true method works for me now. Just running with 3-5 stocks on a day trading basis with a maximum of 15k for each. When I was injured my portfolio was somewhat larger and the dollar amounts also. But I had the time to sit and gaze. It is certainly a challenge to find the stock that suits and to make that wallet filler.

 

[farmerge]

I'm feeling the pressure
Being the custodian of $20k & having that money sitting on the sidelines waiting to time the market has put a lot of pressure on my shoulders. Unless you are retired, everyone else is time-poor. Being time-poor & trading such a low dollar amount of $20k is a challenge for everyone.

Not everyone "knows" the risk of trading with small amounts
Waiting is one of the hardest parts of trading & it's even harder when you are just starting out, being eager to have a go. I'm always on the lookout for new ideas to post about that may be helpful to others. This gives me an opportunity to make a series of posts about "how you go about trading with small amounts of money".

Skate.

Just as an add on this morning I picked up some ZIP not everyones cup of tea I know, but a couple of cents up and it's a good gain for little effort

 

[farmerge]

Just as an add on this morning I picked up some ZIP not everyones cup of tea I know, but a couple of cents up and it's a good gain for little effort

And as a further add on to my day trading ZIP bought and sold this morning for a tidy profit. Sometimes the opportunities just land in your lap. For me ZIP has been a good one for the past couple of months.
As always DYOR

 

[Skate]

I'm feeling the pressure
Being the custodian of $20k & having that money sitting on the sidelines waiting to time the market has put a lot of pressure on my shoulders. Unless you are retired, everyone else is time-poor. Being time-poor & trading such a low dollar amount of $20k is a challenge for everyone.

Not everyone "knows" the risk of trading with small amounts
Waiting is one of the hardest parts of trading & it's even harder when you are just starting out, being eager to have a go. I'm always on the lookout for new ideas to post about that may be helpful to others. This gives me an opportunity to make a series of posts about "how you go about trading with small amounts of money".

Skate.

How do I start trading with little money?
Deciding to enter the markets, is where the soul searching starts & where financial education should begin. It’s an indisputable fact that we all need to start somewhere. The secret to financial freedom is taking the first step to get started.

Fear paralyses everyone
Unfortunately, the fear of losing money is the biggest stumbling block that keeps us from getting started. This is where gaining the right amount of knowledge will help overcome these anxieties & fears. In fact, you don't have to know everything all at once as you will learn on the job. As you go along you will gain the knowledge that will build confidence. The more effort you put in, the better off you will be.

Skate.