all I ever wanted was to churn out a simple living. Never have figured out how to do that. Everything I have to show for myself is the result of a few lucky trades. I don't need any gusto or to be recognized as a top dog. I am extremely non competitive. Nobody wants me to even play board games with them because I see so point in winning if there is no cash prize. But geting back to the question, If I keep doing what I am doing and I live long enough I will blow up. Like I said, accepting that made me a much much better trader.
VN's concept is "ever changing" cycles----- Simons cracked market structure itself-- a true edge-- he is definitely a positive black swan. surf
Depends on how you trade, doesn't it? "Strong opinions, weakly held." On the other hand, if you're going to bet everything on red, then you probably shouldn't do it more than once, if at all.
It's amazing to me how many people on ET do not have an education in finance, or economics for that matter. The only thing that matters in the long run, is like any business, is the net present value of all the future cash flows that you generate in this business. The NPV will take into account blowups and opportunity cost of capital. If NPV is > 0 then you should trade. Very simple. Whether you blow up or not is immaterial as it's priced into the NPV calculation.
I don't think NPV can be reasonably applied to speculative trading, especially over the long run. Trading cash flows cannot be predicted with meaningful confidence or probability, especially over the entire course of a trading career.
yet we are still waitng for a highly educated economist or MBA to successfullly and consistently out perform. You would think they know all about NPV.
VN is a great example of that--- blew up several times but remains very wealthy-- and still made more over time for his investors than lost overtime--
That's a super ignorant thing to say-- there are FAR MORE highly educated succesful folks in the finance markets than dropouts etc. Jim Simons is just one example-- there are tons of finance PhD's who are ultra wealthy from trading MBA is a joke in the finance world-- they know how to use powerpoint, that's about it
Do you understand what NPV is? It's the fact that they DO know what it is as to why they are not trading. If their NPV is < 0 which based on their education is going to make their opportunity cost extremely high thereby creating a negative NPV. Do you even know what an MBA is? Nobody gets an MBA to trade, you get an MBA to work in management. You want me to list all the successful Econ and math majors who killed it in the market. I don't know, say John Arnold, Paul Tudor Jones, Jim Simons, Ed Thorp, George Soros, Ray Dalio. Wasn't much of a wait was it?