Why Is The Obvious Not So Obvious?

I do have one discrete thought – on a completely different note


Trading is the same as gambling – fuck no it ain’t

Trading has more inherent risk and potential to break your ass, than gambling ever thought about having…

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Place a bet – the most you can lose is what you’ve bet…. And the games are designed to automatically get you out – no additional effort on the gambler’s part is required

Place a trade – unless you identify a stop and honor it – there are only two ways to get out of a losing trade – you nut up and exit… or you broker liquidates your position, which is usually followed by a margin call demanding more money (been there done that)

And lest we forget – as long as you have the capital (be it margin or actual funds)– adding to a losing trade is always a possibility (the price has gone to far for too long and just has to come back syndrome)

Betting – once the bet is made it is made…


Granted you may be able to trade on credit, but even that must be approved by the house – so there exist an external protective mechanism – of sorts

None exists for the idiot punching the mouse button

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Betting – the odds are know on all games

Trading – although via back testing some like to think a positive expectancy can be achieved – fact is the mkt is uncertain….

And although price can only go three ways – there are an infinite number of ways things can come together to make it go one of those three ways



Some use the analogy of card counting as a way to improve the odds… same as having a positive expectancy I suppose…. (which I surmise means something to the effect of identify the current trend, waiting for a pull back/ break out, then entering in the direction of the trend

I also surmise this is a mechanism to help these folks cope with uncertainty….

I maintain the mkt is uncertain – period (so act like it.. and damn well trade like it - every time you trade)


One other note on positive expectancy… say its 95% - that means you are still guaranteed 5 losing trade out of every 100 (shocks to the system notwithstanding)

Suppose those 5 come at the same time – you prepared to handle that much draw down

Suppose you get 10 losers in a row (out of a 200 trade sample size) – now you prepared to handle that much drawdown…

What if you get 190 winning trades in a row – you still on your guard and ready for the 10 losers… or have you laxed your use of stops – and will get your ass handed to you once the first of those 10 losers show up

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Betting – rules are already know and well published… Plus you have gamming commissions to ensure the rules are followed by both party's

Trading – only rule is – you have the money – you can trade… all other rules – the trader must create... and more importantly – the trader must follow

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I only wish trading was like gambling…. Be a hell of a lot less for me to concern myself with

It ain’t…

Traders must work their asses off too simply to get their inherent risk to an acceptable / survivable level...

Then of course they must maintain that vigilant till the day they retire
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NY and I had a discussion about gambling and trading being the same a while back… unfortunately I relented… when in fact I should have pushed back a little – completely my bad

Just a random thought from a dumbass - and not wanting to derail the current topic

RN

 

RN is of course correct..trading is more risky than gambling..so TO will tell NY what the fuk was he talking about

also..RN has stated exactly what each person must do..so..do not take any heed of what TO posts..unless u are trading a similar way..and u find it helps u..otherwise just look at is as another way that someone else trades

i will add one thing..about options..and that is..u still need to LOOK before u place a trade..added benefit with buying options is that ur risk is limited..to what u pay..so..a bit closer to gambling than stock/ftrs trading..as gaps can and do occur

know ur risk on every trade..and accept it is gone before u place the trade..a lot easier said than done..but if u can do it..then trading becomes much easier..and all the market fluctuations will not seem that important as they used to..for..now u are playing the odds..instead of playing the fool

RN..nice to see u are still alive and kickin (ass)

TO

 

I don't mind being as bad as TO if my trading gets to be as good as TO

So you probably saw lots of option buying at 1350 and the bastards will run it down below that so they expire worthless and then move the price up after market close? btw how did you know it was option buying and not closing previous positions - monitoring volume and OI - there I go with the same rubbish

Booktrader setup looks interesting and would keenly follow it i.e. if you share it!

RN, sir, good to see you stop by! Always enjoy reading your posts. Learned couple of good things - your advice about stops is very good.

Trading as gambling is indeed a double-edged sword and needs to be approached the same way.

Oh TO looks like you scared the new guy SY - but better be humbled on a forum before getting humbled by the markets

 

http://www.elitetrader.com/vb/showthread.php?threadid=245590

 

Hi RN! Glad to see you here. TO - do you primarily trade stocks or options? Just curious.

 

I can understand his frustrations and I doubt that he was 'scared' off, rather he simply decided not to participate unfortunately.

 

what comes next is that I feel cheesed off with the mickey mouse platform that CMC markets provides

 

go with IB, cant go wrong.

I closed CMC ages ago, good to learn on but not viable long term.

 

TO didn't know..as the OI column shows nothing when u add it..must ask IB about this actually..as no harm in looking at the values..i suppose..so..i gambled that the bastards would keep it below 1350..and my gamble paid off this time that the price would run back up a bit after stocks close

as mentioned ML..there are always losers..and winners..just make sure that the winners are bigger..etc..etc..we all know it by now

TO may have made a bad call on EUR option..so TO has decided to bet again..but with some additional time with less risk than first trade..just in case required..if euro gets above 1.235 this week then TO will be very happy..but if euro hangs around..or keeps falling..then TO will lose some money over next few weeks..but that is acceptable..as it is part of trading..so..only time will tell

TO

never be afraid to lose..and never listen to those who only speak of winning..for..they are just arseholes..really