The Journal will be for those of you who want slow, steady gains and are willing to invest in your business. If you think about the unrealized drawdown, that is simply your investment in your business. Will you get your investment back through income....yes... As we speak there is a research happening behind the scenes through PM's, from very talented folks. So stay tuned and visit the Journal from Time to Time to see how its going. I will respect the anonymity of anybody who wishes to research with us, and wants to be part of this. Shoot me a PM...But I must warn you. I am a plain talker, and not as sophisticated to understand you guys, so you must talk to me in a plain way. I do not want to let the "cat out of the bag" too early. But what if through hedging with various technique's, could be implored to actually reduce your investment in the business to a fixed amount and hold it there, throughout your income earning phase (or reduce it to zero, would be beyond my wildest dreams)? This would be accomplished through exposure, weighting, timing, positive interest earning expectancy and trade size that were all based on dynamic price action and condition? (I am currently dealing with it through a cash subaccount I have dubbed the "Gambling Meter", but there is a much better way) And one more thing...... Please vote in this poll in this thread... WHAT SAY YOU? IS TRADING GAMBLING OR NOT?
Folks One more thing. Please tell all your European Friends and all those Ladies out there. ET is changing and becoming better and better everyday. All are welcome in the Journal....New, Old, Experienced, Male, Female, Curious and whoever I have missed (we need you ladies, most of all. Please help ET round out there guests and participants. Wifey will be participating when she can too.) Cya next week. Michael B.
http://www.elitetrader.com/vb/showthread.php?s=&postid=727821#post727821 Brought forward: When your NOT gambling and your making some scratch...if you start making more and more on an accelerated basis...what does a non gambler do? I will tell you... Beginning next week in the Journal, I will reduce the trade ticket percent...to insure that we are "not gambling" even less...You know what fast profits mean don't ya...it means the "gambling meter" is set too high. Please Vote in the poll here, and start your gambling meter from zero.... Cya folks in the Journal...it will be called "Elite Traders Gambler's Anonymous". All are welcome to the "ETGA". Michael B.
Currently the poll says 64% think NotGambling. You know if I was a gambling man I would've bet NotGambling But seriously it depends on your definition of gambling doesnt it? Im guessing for many traders gambling is defined by certain habits we try to avoid, might be averaging down or trading without stops. But to me gambling is when ever theres an aspect of my trading that I dont have a reasoned expectation about or my reasoning fails.
Finger, Thank you for your comments. Expectation, Probablities and Edge... These can be managed to take your "gambling meter" to Zero.. ----------------------------------------------------------------------------------- As to the time thing.... If it takes you 10 years to make 2% ....your gambling... Michael B. P.S. My reply may be confusing...but it all comes down to what I said...read carefully. I wll demonstrate it further in the Journal... Every action has an equal and opposite reaction. Infinity defined!
If a river expels 10 gallons per second in evaporation, and it rains 10 gallons later...did the river lose water? and how long in between rainstorms did it take... What if it rained twice and a beaver diverted water? Could you imagine the beaver sharing with you? The water is your profit from the flow....(and the bonus is the beaver, let ALL the water back into the river) Now if this took three years, how much water would you need? Consider the flow to be at least three times greater in between rainstorms...you be the beaver.... Is this Gambling, Can you see it yet? The "Gambling Meter" is set to Zero...the rest is trading....
Readers, Electric might have something here. A few of you may see it already. Ok, you say I am biased and I favor him...look, I am always honest. I suggest you stop into the Journal now and then to check the progress... I believe Electric has found a balance using mathematics and is using Flow and deviation analysis, to come to a hypotheses...Let him prove it.. I read something by Ed Seykota once about this, but it went over my head. I believe the gentlemen named, Mr. Grob, understands what Electric is talking about. The reason why this method, Electric is teaching has not been possible in the past, is because of the shear large size of numbers involved. Oanda has 1 unit incremental trade size capabilities allowing retail traders to visit this possibility. Electrics use of leverage and the one unit package equals a factor, which applied to acceleration may give heed to "Electric Math" (murray math move over, scale of ones is the future ) Wifey