Trading is one of the strange professions. people would rather pay by losing in markets than paying someone to teach them. The people who understand the need for education and are ready to pay for it are traders who want to increase their return. Those who traded and lost do not have capital to pay for education. As for the model of education, my favorite is profit sharing where apprentice contributes cash and educator contributes knowledge. Both contribute time. Education is different than instruction. The educator/mentor job is to put in the head of the apprentice the mindset, methods, tools that the educator has in his mind, and make sure that they have been understood and absorbed correctly. Such education is a process, and must take time. Educator must provide something that no one else has. The number of true students is small, and the number of true educators is smaller. I would request a Letter of Purpose and an Application Package (like the one they ask in Graduate School) before I would considering admitting someone for possible mentorship. I would even require letters of recommendations (just to make sure the person is suitable). For instance in my first session with someone I want to share with, after building some rapport, I will start debugging the mind of the student if he as already some trading knowledge. If I am dealing with a clean slate it is easier. If you wonder whether you know trading knowledge, answer this question (pros/winners know the answer explicitely and implicitely): 1. Consider a monkey that makes trading calls on an index. The Monkey puts a stop loss X. We want to know the ratio of the probability of trade stopage to the probability the monkey makes X dollars or more on his trade. What is that ratio? 2. Would monkey have zero, positive, or negative expectancy. 3. Could you give some easy to implement rules to increase the expectancy of a monkey trade. PS: Our monkey is nothing else than the sum of all traders in the market (the average trader). Half the traders are worse than the monkey but they may not realize it explicitely. All losing traders are definitely worse than the monkey trading explained above.
The real challenge is to find a worthy mentor. There are very few with proven track records that are willing to mentor. But if someone thinks that paying few grand to someone is a good education investment, they would later learn that it is few grand wasted for the most part.
my guesses (can't do better than guesses, sorry): 1. if X=stop, Y=profit_target then probability(win) = X/Y 2. definitely zero expectancy if X=Y, most likely zero expectancy no matter what X and Y. the special case of X=0 seems to give a positive expectancy assuming the random walk. but X=0 implies an unlimited supply of $$ and no monkey is that rich. 3. i can't figure out how to help the monkey assuming the random walk.
I agree with th 15 dollar comment. I have actually gotten the best thing out of various really cheap ebooks and ended with my own really cheap ebook system that works for me and I think substantially improved over the ones I got. Very simple like you said. Many of the times I feel like they were 90% of the way there and I just need to polish it. One example was a person that used the 2 minute and the ten minute with the MACD but changed the settings for the MACD in each time frame. All I did was adapt it to seeing the 1 and ten and keep the MACD with the settings for his two minute the same on both charts and it was a home run. I honestly believe that people will not give out truly profitable setups. Because I can see how protective I am of what I have developed and I just keep is simple. Nothing beyond anyone but polished.
If you are a real pro...with a real edge and you make real money, why would you want to be a mentor ?
When the student is ready, the teacher will appear. -Buddha Sounds like a crap answer but I think there's truth in it. These days we rain down teachers on kids and education is seen as a right. We don't teach how to figure things out for yourself, you just need to have the fire and struggle. This isn't like trade school. I think it's more like independent science.
I like that you tried to generalize the problem. But let us discuss the case of X=Y, and only question 1. for the moment: R U saying that probility(win)=X/Y=1/1=1? Clearly something is wrong?
i was wrong. i meant to write it like this: prob(win)=X/(X+Y) i don't know the texact formulas but this is the type of ratio i see in backtests (quick and dirty)