Wow. I must admit that I am rather surprised by this post. I have always considered entries to be of fairly critical importance. There are other essential elements in a good trading strategy, to be sure, but I would never have thought that entries would be relegated to the bottom half of the list. As I see it, the quality of your entries largely determines the "cost" of your trading. The poorer the entries, the higher the cost, either in the required distance of stop placement or the frequency of stopouts. So in the same way that a manufacturing concern may choose to focus largely on marketing and consumer trends, it would be remiss to downplay the "cost of production," since it is a critical component in arriving at net profits in an income statement. Personally, I would place entries in the top half of that list you referred to, however, that is only my opinion.
What is absolutely insane( ignorant ) is the way how you dismiss the whole field of dynamics( price or mass ) basing you opinion on your misunderstanding of practical existence and aplication of Newton's law.
A few quick points and then I really must take a breather. -- To say that entries are not top priority is not to say they are unimportant. The markets are so competitive, and slippage / commish costs so onerous, that EVERYTHING is important. Similar to sports, you can't have any major holes in your game if you want to succeed on a professional level. -- With that caveat, there are a number of things more important than entries. Think about value investors and venture capital investors. These guys have an intense focus on valuation and/or growth potential, but they don't have a laser-like focus on specific entry. A value investor has a range of criteria that determines whether an idea is investable or not, rather than a specific price point for entering a position. The same with a VC guy -- he may be willing to fund a project in the neighborhood of X million dollars for X percentage equity, and has flexibility within his established range. The bigger picture is more important than point specifics. Entry is almost an afterthought, coming into play as a qualifier -- i.e. is available entry 'acceptable' based on filtering criteria-- once the other pieces have fallen into place. -- Most traders have a basic grasp of risk, volatility and money management, but they do not have a deep conceptual grasp of these things. If there are any 'secrets' to successful trading, apart from the quant stuff, they are embedded within the risk / volatility / mm triangle. A skillfully constructed portfolio is a wholly different animal than a handful of good looking trades. Making money from controlled volatility exposure is different than making money from 'soybeans' or 'IBM.' Playing for long-run expectation based on detailed analysis of statistical trials and/or a deep understanding of market mechanics is different than a focus on making money RIGHT NOW in THIS trade. It's a different ballgame.
newton's law can be applied to supply and demand? is that what you are saying? mass is the same thing as price?? please elaborate a little on the correlation of newton's or any concept of material physics on price. thanks ! surfer
After reading this post, I will admit that we are speaking on different levels, with me on the decidedly more rudimentary one. It also seems that we may be drawing a distinction between trading and investment/portfolio management, as the terms are generally understood. (Assuming that a distinction can be made.) I suppose that it is a matter of perspective. Since I presently only trade ES intraday, much of what you refer to has limited application for me. However, your points are certainly valid and I appreciate your response.
the basic flaws in TA Hi guys, I'll give you the definite answer so you can all go back to trading - (for most crap shooting & losing). There are in fact many TA's. Each practitioner has its own. Only the biggest fools pretend openly to have a definite "Method" and hence attract impressive crowds of hungry followers (i.e. look up Jack's nutty threads). As according to popular wisdom 95% lose - point apparently never seriously disputed - 95% of what goes around as TA is pure BS. By that, I don't mean to say that a cogent approach to the profitability riddle wouldn't exist. Not at all. It is simply not floating around on websites or in bookies, however much some of these 'wise' authors are praised by that huge crowd of suckers. Hope this helps, nononsense
yes, exactly. the huge crowds needs to exist so the market can feed itself. see darkhorse post above. LOL ! surfer