Not disputing what you are saying. But edge is required above everything else 10x. No money management or mental disciple will help you beat Casino in roulette long term. They have the edge over you. Period.
Agreed 100%. However, for manual traders, emotional stability is part of their edge. That's why you can teach 1000 people to trade a certain way and few of them will. Turtles is a great example of this. They couldn't even follow a completely spec'd out trading system with a proven edge ... all they had to do is press the button
If you have "a hell of an edge" but are emotionally not stable to trade that edge you are nowhere too. The only exception is a fully automated system with no human interference.
How do you know it is "a hell of an edge", apart from insider trading? You could be fooling yourself, or just catching a bull market wave. You need to backtest, and if you can backtest, you can automate to your exact point.
What I wanted to explain is that no matter how good you edge is, if you are emotionally not stable to trade that edge you are nowhere too. So edge is not all, edge can be even completely useless if you are not able to trade it. A question for you: "How do you know it is an edge, apart from insider trading? You could be fooling yourself, or just catching a bull market wave." In other words:I can ask you exactly the same question as you asked me. I backtest manually as I never succeeded to write down the complete system in full details. And as long as I cannot do that not even the best programmer in the world can program it. As he misses the essential part: my information that has to be programmed. So emotional stability is very important for me as well as for discretionary traders.
Hey, to each its own. I learned the hard way pitfalls in manual backtesting. Mind tends to filter/miss things quite easily thus not producing accurate results. Good luck in your journey.
agree, in back testing I am an absolute God like Trader, huge gains, no mistakes.... not much help in real world trading with real money
So true. That’s why having a forward testing methodology is the crux that makes or breaks strategies. Piecemeal set-ups have limited utility. Designing/Having/Implementing complete systems that operate in all market environments regardless of volatility is the key.
You mean in paper trading? Back testing implies automated (strict rules based) systems. So either your back testing is way off or you can't follow the rules.