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achilles28
Registered: Apr 2005
Posts: 7609 |
06-01-11 03:25 AM
Who cares if trends exist in random data?
Trends exist in all random and non-random activity.
And the market is not random. So the implied premise is wrong.
Close thread.
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oilfxpro
Registered: Oct 2007
Posts: 1600 |
06-01-11 08:23 AM
Quote from Visaria:
Why would you suddenly start making winning trades after 30 more losses than profits. Why couldn't you keep losing, in fact losing even more since you doubled your position size?
If you use a 50 /50 system , 49 % used in this method, your 50 % hit rate will come back.
There is random distribution of profits and losses , so your system will revert to 70 profits/30 losses at double the lots.
Some of the day trading systems around have 20 % hit rate, they are not suitable for increasing bet size.
This sort of money management can have many complex variations , they can turn random systems into profitable systems.
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oilfxpro
Registered: Oct 2007
Posts: 1600 |
06-01-11 08:31 AM
Quote from achilles28:
Who cares if trends exist in random data?
Trends exist in all random and non-random activity.
And the market is not random. So the implied premise is wrong.
Close thread.
Nothing wrong with this thread , great thread by some useful positive contributors.
If you are a real trader , you want to know why you see trends where none exists.
Random distribution of bidders and offerors of prices will create so called trends where none exist.10 sellers and 10 buyers come into the market every day , but their buy orders and sell orders are randomly distributed , at different times and in different quantities.On different days you will see trends where none exist , and on other days where trends exist you will see none on the lower time frames when their activity takes place.
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achilles28
Registered: Apr 2005
Posts: 7609 |
06-01-11 08:39 AM
Quote from oilfxpro:
Nothing wrong with this thread , great thread by some useful positive contributors.
If you are a real trader , you want to know why you see trends where none exists.
Random distribution of bidders and offerors of prices will create so called trends where none exist.10 sellers and 10 buyers come into the market every day , but their buy orders and sell orders are randomly distributed , at different times and in different quantities.On different days you will see trends where none exist , and on other days where trends exist you will see none on the lower time frames when their activity takes place.
that's a load of shit. obviously you don't know how to trade or you wouldn't have said that. the market is not random. study after study has demonstrated the extreme prevalence of fat-tail market events. guess what that is?
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Butterball
Registered: Dec 2006
Posts: 464 |
06-01-11 08:44 AM
Quote from oilfxpro:
Yes ,a trader highly skilled in money management can make money from a random chart.
No he can't. A random market by definition doesn't offer any alpha to be captured by even the most skilled trader. In the best case in a perfectly efficient market (according to the EMH) all there is to capture is market beta, e.g. the S&P500 performance.
Factor in commissions and slippage and your highly skilled trader is losing money in a perfectly random market.
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