Yes you can make a decent living trading. Systems: LTCM proved with not one, but TWO, Nobel prize winners that "systems" do not work. They will blow up. The small retail traders (us) are but gnats on an elephant's back riding along for the ride. You have some basic experience so just build on that. Learn 3 or 4 basic highly liquid stocks that are in the Nas 100 or better yet the Dow 30. Has anybody noticed that the NYSE trades 1.4 billion almost every day. The hedge funds are daytrading the indices. Very obvious. Most traders have never been in business for themselves so they treat this as a game. It is a way to make money, nothing more, nothing less. I would even go so far as to state that the "love of the market" is a big negative. This is like a gambler that loves the "action". You must have a business plan. Pretend you going to the bank to get a SBA loan to open a shoe store. You don't "love shoes". You think there is an opportunity to make some money in the shoe business. Rent is low, cost are reasonable, execution and communication is very efficient. How would you explain to the banker to loan you $50,000 to begin this endeavor. Put a pencil to the numbers and see what happens. For books, I think Bill O'Neill's is the most basic. Buy stocks that are going up. If they aren't going up, don't buy them. CUT losses quickly and sharply. I have never heard of a technical guru that got rich off of trading. I think Pristine has some pretty good basic understanding of the business of trading. Find your "niche" in the market. Know what you want to do and when to do it and when NOT to trade. Good luck, Steve
That means no one could ever finalise a relatively complex trading system after testing and testing. Then how could you say this kind of complex systems works? However, developing this kind of complex systems has a its valuable and positive merits. The system developer could save money becuase (s)he would never have any time and confidence to actually execute any trades. Very good idea indeed, axeman.
it was not the system that failed in the LTCM situation. it was the greed of those using the system. the LTCM program made consistent profits, it was misused hence blew up. best, surfer
Don't take me so literally. All i'm saying is that learning proper system development takes a long time, and then developing a working system takes a lot of time too. I've spent a LOT of time on a single system, which I finally got profitable and "well behaved". I have also spent a lot of time looking under hundreds, if not thousands of "simple system rocks", and finally found one. Both approaches can take a very long time, but for very different reasons. peace axeman
I often wonder if the same was true of Jesse L. KNEW how to trade, but just bet WAAAY to big all the time. Anyone have any details? peace axeman
I want to thank kp and Steve for the most recent posts. In addition I want to thank everyone else who offered constructive advice. I have learned quite a bit by reading some 100 plus responses. Thank you all. I have decided to persue trading as a business, and like a business. I have an analytical mind and enjoy what I am doing. I have been putting in 60 hours a week on this and have enjoyed every minute of it. Right now I am seeking the proper direction. With time, I think I can get there. Thanks again to all those who have offered their help. Ed
I think "systems" are going to fail every time because the facts or assumptions that designed the system change. And if the system does not have a mechanisms to adjust to that change it is doomed. I truly believe that "trading" is 80% +/- learned and 20% "art". Now, the hedge funds etc have big computers that trade with big computers that "hedge" those trades, LOL. I would liken a "system" to one of those guys that disarms a bomb. He is a hero 99 times and then one day a small miscue and boom. Out of business. In my opinion one has to keep it simple. The average guy does not have the capabilities to analyze all of the data that is available in today's market. God, you can be overcome with numbers and lines on the chart. Like Tarot cards. Each and all can mean what you want. Especially in hindsight. Learn to trade IBM, MFST, etc. Keep it simple and cut losses. Since the All star game is on I will use the old baseball term, "see the ball, hit the ball". I think we have beat this dog to death, LOL. Steve