Can anyone recommend a site where I can do paper trading? Other than TD where I already have my account. If I had more than one lace, I could be testing/playing with multiple strategies. Which might help me find my edge
Build a strategy before you papertrade. Building a strategy requires historical analysis (backtest) of the drivers of returns in your strategy. For example, if your plan is to buy stocks that have been rising in the past 5 days, how well has this strategy done in the past 20 years? What are the drawdowns and risks? How correlated is this to SPX? You will want to stitch together a strategy and backtest, define risk limits, etc., before you try to paper trade. Frankly. once I have a strategy that has been backtested (robustly, so make sure you are adjusting for data errors and sampling bias!), I start allocating capital in small amounts, e.g. 5%. As I gain more confidence and a track record of performance for the signals and strategy, I add more capital. I'd say my trading strategy has signals that decay and are replaced 1-3x a year.
Edge is what generates Alpha. It's your advantage you got in the market. It also applies to business and entrepreneurship. An business may have one or more advantages (logistics, production, sales, marketing, whatever) over other competing business in the same product/market.
I finally found my edge... a strategy that I have a 69% win ratio. However, I had to fail and fail over and over with all kinds of strategies in order to have enough data to figure out that one strategy that gave me an edge. I had 2 years worth of trades journaled on spreadsheets and over 1000 trades to analyze. I'm not sure if that helps , but that is my journey up to this point. The biggest challenge is to stick with that one thing that has an edge for me and not jump to the "newest shiny thing" of the day, to ignore all the ads on FB, email, etc.. of the latest guru with the latest sure fire system. My edge is a strategy that I developed. Many of those that did not work for me were paid alert services and such.
My edge has two components: The first is the use of three or more painstakingly selected moving averages to give me an unambiguous picture as to when assets are trending strongly... (I do NOT use the standard 10-, 20-, 50-, 100- and 200-period moving averages.) The second is the use of price range envelopes whose parameters have been set based on statistical analysis of historical data to suggest when assets have reached levels where the odds of their reversing direction are likely at their highest.
Expiated, thanks, this is good stuff. It’s similar to what I’m thinking…moving averages combined with standard deviation, possibly relative strength.
Edge is only one component of a successful trader. Expectancy is not fixed number because winrate(statistical edge) can be a changing variable with time even you set a fixed risk/reward ratio. Even in an ideal scenario with a consistent 10% edge, how many traders can pass this test in 30mins? https://gamesfortraders.com/coin-challenge/ The intuition/art of knowing when to leave the table (e.g qqq relative volume <1) and come back another time could be more effective than statistical edge. "After 30mins in a poker game, if you still can't identify the patsy, then you are the patsy! Just leave." I think Buffet said this.