I learnt from experience, and quickly learnt to stay away from all these educational websites, and websites selling trading tools etc etc. If you know how to see when there are more buyers than sellers (or vice-versa) in any market place you can be a trader. Forget lagging indicators and pretty lines on charts. As soon as I finally accepted that I then understood the game. Refinement is an important part of being a trader, the markets are changing every second and there is no point in staying rigid when you should be adapting. The small fry (us, the people who have time to write in these forums) are always at the mercy of the big players. There is no edge, just simply buy in when you believe most people are going to be buying in, and sell when you think most pèople are going to sell. If you can do that right 60% of the time with a decent win lose risk ratio you're a trader
how do i know if i have an edge or not? i just started out and i'm semi-profitable although i don't have huge confidence in my system
Yup Leed, u r right. Sorry for not making it clear coz HK is naturally Hong Kong for asians, but not for u guys. my bad. Yeah, I'm not related to RC or anything, just read his book, and from his book's source code at the back of the book, I got some ideas how to program my strategy into autotrading system using Easylanguage. its really not that hard. His system is trading ES, and I program my system to trade ES and NQ. I have 1 system that trades ES, and 1 separate system that trades NQ. How to know if u have an edge? If the profit factor is > 1.0, there's an edge. U have to see the TS backtesting results to determine your edge. of coz, there's a chance the strategy dont work in future. Thus forward testing is essential. I have programmed my system and have been testing it with real account, using 1 contract of E-mini since 2008. If anyone keen on the report i can send over. Again, past performance is no guarantee of futures performance. Anyone who is a real trader should know that. Its all for sharing basis. I really have no intention to gain anything from you guys. Wish all of u trading success. ^_^ If u keen can checkout my trading blog at (Please Post all content referenced here - EliteTrader Staff -Joe). I also attached my 2009-2011 auto trading system's performance here. Its nothing great, with capital of 20K, after 2.5yrs, it earns me 10K++. Oh well, the very fact that its profitable amazes me. Coz I really dont believe in auto trading system. But it seems to be slightly profitable. Haha.. amazing.
i can't tell if you're a spammer or not going back to having an edge...even if your profit factor > 1.0 doesn't mean you necessarily have an edge what if market conditions change 6 months from now and your edge disappears? then what do you do?
The market condition definitely keeps changing. And the trading system MUST NOT be tuned to suit current condition, if not its optimization. As i said, I have tested the system since 2009 till now, with NO CHANGE whatsoever. that is at least what an honest trader should do. If there's no edge, admit it. No need to save some face. As I said, i am skeptical on autotrading system myself. How about urself? do u manual trade? or autotrade? Why should i spam? its for pure sharing. I have been trading for last 10yrs on Stocks, Options, Futures, CFDs, Commodities. These recent years i just stick to NQ and ES. Its a hobby really. I think to full time trade and earn money from it alone is a ridiculous thought. PF > 1.0 means ur system "seems" to have an edge. It doesnt prove it definitely will have an edge. Again, when u realise it has an edge, the edge could be diminished. Or when u realise u hv no edge actually, ur a/c is already empty.
A person who posts a refernece to public and freely available edge is the first to get "flamed" in this thread Indeed, at the very least it should be larger than 1 by a statistically significant amount. Stop trading the edge naturally. There are people that say the market is the same now as in 1930s... bit there are a few edges that exploit an anomaly that can easily disappear when the space gets crowded. So, it's important to have a rule that says when a trading methodology stops working.
Oh... freely available edge? No one will post an edge unless its already stop being an effective edge rite? Its good to refer to other's "edge" for ideas. I dont blindly follow. But i try not to be too objective or stubborn on insisting my own ideas either. When I read the books of RC, Alan Farley, Alexander Elder etc for example, I get some ideas on how others think, which drives me to think deeper than utilizing conventional indicators. I try to develop some different approaches towards trading. Anyway, how large a PF must be before start trading real money is individual preference. Most said u need at least PF>2.0 before its even worth trading real money. To me, anything that doesnt lose money is an ok system. Anything that makes me money is a good system. I used to hv PF>7.0 systems that lost money in real a/c testing. There's also system that has PF<2.0 that wins in real life. Backtesting results is for reference, not really absolutely reliable. U hv to have faith in your own system, if not whatever PF wil not give u the courage to try running it in live a/c.
Well, no one posts a complete trading system that makes money every week... However, a number of people write about ideas with strong postive expectancy of returns. Just in the raw form these tend to have too high drawdoawns for most traders... As you say yourself, the value is ideas, not a turn-key system
hard work and experience. the real key is to never stop working hard and learning. trading is much more than just charts. you also have to master yourself before you can successfully tackle charts.