In response to the quote- "PHDs are the way forward, I am not one of them but i am a very good programmer and mathematician and i think it helps big time...if you're too traditional you might as well apply for a job at Burger King specially if you do your nails at the office instead of doing your research..." I don't have a Phd, I do have a degree, but I still think a brain is better than a box any day. I think a lot of quant geeks may be book smart, they may know everything there is to know about black-scholes, about delta, and gamma and beta, but they're not street smart. Traditional traders know what the buzz is in the market, no black box can sense that, by definition it has no senses... I'm sorry, but individual black boxes mightbe successful, collectively they won't all be, as with traditional traders, so i't just an open ended argument, BUT I'm right
It is a known fact that Financial Institutions especially since the mid 90's have been spending money on out of school programmers and math grads. They spend millions developing math equations in hope of having a short term window of opportunity. As indicated in this thread most still need some form of human assistance to obtain max. profit Financial Institutions have the ability to purchase all current data and evaluate this information well before the market has a chance to react in most cases. Algorithmic Trading assists in creating the market opportunities for the Institutions at usually our expense by trigger stop losses, trailing stops etc.
Having a degree doesn't mean anything if you did not learn the substance or earning it. If after earning your degree you can not think independently, outside of the box, create new ideas, innovate old ideas... that is what you should get out of a good college degree. I don't have a PHD but being a triple major from a top 10 undergrad program has helped significantly. I would never consider a PHD at this point because I have what I want and the stuff I don't understand but need to, I can buy or pay someone to do it for me... such as creating black box trading systems. I don't need to spend another 4 to 5 years to go through the motions of thinking for myself.
Balls. Balls are as good as a smart mind in my opnion, in the market -------- Which do you think has kept George Soros around? Rather when he interviews people to run his funds... do you think he looks for BALLS? or BRAINS? ---------
I visited a few futures trading firms over the last few days and was rather amazed at what I saw on the automated technology side of things at these firms. It was my belief going in and was reaffirmed after the visits that over the very short term most but not all short term futures scalping traders and firms will have an increasing difficult time competeing and I don't think that will be a business model that will work without the assistance of technology. If your target is to make a tic in a trade there are firms that have numerous automated scalping and spreading programs that will see and react way faster over the long run then most most humans can. If these firms see an idea they can have something up and running in the next day or two ready to go live and take advantage of it. However their strength and edge is in the very short term, but they pound away at it with size and frequency. So to answer the question I don't think most traders will be able to compete longterm on the very short time horizon in futures. I think that advantage will go to the black box/automated systems. However where a trader can compete is in the longer time horizons 5min- to hours intraday as long as what determines if you make money or not is NOT if you get filled at say 50 or 51.
Automation can be meaningful with respect to size... However as size is constrained...a good...practical...street smart trader can make more than most of the US population income tiers... Some will make similar or better than top level ceos... with about the same odds as one becoming a top level ceo...
Traders are simply changing their mode of operation. Instead of clicking buy and sell on their hot list of stocks they are running algorithms and tweaking parameters. ....greg
agree with you tick. Here's a REAL automated system .. http://www.elitetrader.com/vb/showthread.php?s=&threadid=54170 But in the end you need good trading ideas .. not phds. regards, auto