It's not something that can be abused by simply knowing about it. Otherwise, everyone will be a world class trader or poker champion.
Humans can indeed compete against the machines. Nice ending Clive, as if we needed FT to come to that conclusion. Algorithms? Based on the oxford dictionaries definition is a process or a set of rules to be followed in calculations. isn't that how indicators are programed, and many of us have tweaked them to fit their own what works scenario? Traders don't need to fear fancy algorithms or beat HFT's, they just need to follow along for the ride and get off the gravy train to go play and come back another day. Gut trading is more like gambling, works just some of the time. Do we really need a Gut to tell you when the top or bottom is in? In the end this paper is just kindling for a fire or emergency toilet paper for the woodsman. really not worth saving or reading.
Yikes! ALL trading, without exception, despite any contrary arguments, ONLY works "some of the time"!!!
"In exchange for universal applicability, you give up perfect execution" -Julia Ormond ( chartered technical analyst)
Please, don't misquote me. I did not state that gut trading was gambling. That statement was made by Zodiac4u.
Most of you are going to get screwed up in your heads , then blow your accounts , even thinking of this path will destroy you. http://www.bbc.co.uk/news/business-36937109 guts guts guts :He had guts He added that traders were pushed to make profits "no matter what". Asked if the crimes he committed - booking fictitious trades to cover up gambles in the hunt for profits - could happen again, he said: "Absolutely". Adoboli - the biggest rogue trader in British history and described by the prosecution at his trial as a "master fraudster" and "sophisticated liar" - now faces deportation to Ghana, where he was born. He said he is fighting the order as he is as "British in culture" as anyone living in the UK and could help the finance sector to reform by sharing his experiences.
http://www.bbc.co.uk/news/health-33363948 Raised levels of the hormones testosterone and cortisol can make traders take more risks, which could create instability in financial markets, a study suggests. Researchers said stressful and competitive working environments could be increasing hormone levels and having an impact on decision-making. Volunteers played a stock market game while hormones levels were measured. Experts said it was important to know how hormones affected traders. Both cortisol and testosterone occur naturally in the body. Levels of cortisol increase when we experience psychological or physical stress. This causes the blood sugar levels to rise and prepares the body for a "fight or flight" response. Writing in Scientific Reports, the authors carried out two experiments as part of their study. First, they measured natural levels of the two hormones in 142 male and female volunteers while they played a trading game in groups of 10. Men who had higher levels of cortisol were more likely to take risks, which led to instability in prices. But there did not appear to be a link between cortisol and risky trading in the women who took part, which is consistent with other research showing that women respond to stress in different ways. In a second experiment, 75 young men were given one of the hormones before playing the game, and then a placebo. The results showed that cortisol appeared to encourage riskier investments while testosterone increased the feeling that they were on a winning streak. The research team said their work gave a better understanding of traders' behaviour and how it might affect financial markets. 'Elite athletes' Dr Ed Roberts, study author from the department of medicine at Imperial College London, said the traders' working environment was key: "They are like elite athletes - they need to be looked after." He also said there was more research to do. "We only looked at the acute effects of the hormones in the lab. "It would be interesting to measure traders' hormone levels in the real world, and also to see what the longer term effects might be." Dr Richard Quinton, consultant and senior lecturer in endocrinology at Newcastle-upon-Tyne Hospitals and University, said it looked to be a "powerful and robust study". He added that an obvious area for future research would be looking at the behavioural effects of giving small doses of cortisol inhibitors to traders. Prof Ashley Grossman, professor of endocrinology at the University of Oxford, said the study suggested that raised hormone levels can both cause instability in the stock markets and feed off it. He said: "With massive market volatility forecast over Greece and its debt repayments, or their lack, it's important to know just how much impact hormones have on traders' decisions."