The Theory of Edge Diminishing

Discussion in 'Trading' started by .sigma, Dec 7, 2019.

  1. .sigma


    I've read a lot on forums about how traders don't tell their "edge" to the public because they are fearful if by doing so, this current method that feeds their account would suddenly disappear, or maybe gradually, becoming fully arb'ed..

    Is this shit even real? Lets say you tell this forum your exact money maker.. lets say a few thousand people start using your method (highly unlikely), would you really see your edge disappear? These strangers would have to trade exactly like you to accomplish this, and of course the trading will differ no matter how similar the set up.

    IDK about you but I'm not buying this. Thoughts?

    Discuss :)
  2. Nobert


    There is no edge, that would protect from greed & fear.

    Masses find it boring, the finance overall. They want shortcuts. Courses. That one video or answer that will reveal the secret.

    You show them trend lines, :

    ,, Ok now i know ! So simple ''

    Goes all in into single or two correlated blue chips, correction comes, gets busted. Liquidates, tries again, gets busted on the crash, because doesn't have a clue what risk management is, overall 50% loss per annum.

    Forgets trading permanently.

    Starts preaching to neighbors :
    ,,Man that trendline shit doesn't work, it's a scam !''
    Last edited: Dec 7, 2019
    remogul92, CharlesS and .sigma like this.
  3. .sigma


    Huh? Who said theres edges for protecting emotions?
    remogul92 likes this.
  4. Nobert


    It's more likely, no one wants to tell it, because information is the product, and it would be, like giving away new car to random stranger.

    But upper post was directed to the masses.
    ( it's edited by now )

    So even you tell them the secrets, the likely hood, that they will make, will remain almost the same.

    Because there are tons of sub-skill sets to learn.
    pedro0309, IAlwaysWin and .sigma like this.
  5. .sigma


    What I'm saying is, lets say some guru gives his exact method away step by step for free to this forum. How many people would have to trade his set up for that very trade to fully arb itself out of the market?
    murray t turtle likes this.
  6. Nobert


    Depends of the derivative type, product specification, and amount of people/size of those players (?)

    Those are techinicals, but could it happen at all, in the first place ?

    Like a person, that you're not sure about, if hes credible or not, shares top secrets. Sounds like a red flag. Few guys tried actually. It's funny tho.
    (given the fact that, we are talking about masses using it, the public as you mentioned, not few , experienced member of a forum, who starts doing it as well)

    One of them was calling, the real traders in here idiots, and claimed that it's only for open minded green people, who are full of potential. Something like that. Had some Triangles based illuminaty signals system.

    Another, was from the past, with new present nick, that shared some strategy on options.

    Another one, was preaching about some dooms day book, and if thou haven't read it, then he/she is an idiot.

    I kinda help my uncle, with his noob investing (man prior, was investing in local penny trash, 60 mil cap, 30k daily vol, milk companies), but that's one on one, in case i die or something, at least one good person will have this knowledge. Maybe in future few more people.

    But to come into a forum , and share it out of the clear sky. For free. With people that you don't know, with the public. With folks who thinks that yahoo finance is front running their trades and moving markets based on their 401k picks.

    Away from material reward for thou efforts, this way one also removes pleasure/fulfillment of passing the knowledge, and new stable relationship/friendship is unlikely to happen.

    Tho the PM section is definitely good place for that.
    Last edited: Dec 7, 2019
  7. _eug_


    This is a question of liquidity....
  8. .sigma


  9. trend2009


    in this regard, please share your trading strategy with true edge. if you do not have one, you just hope someone is stupid enough to give it to you for free.

    in my case, i even do not open a second account to trade my own strategy with different parameters because I am afraid it will degrade its performance. sometimes a few hundred share competition will move the bid/ask by a few cents, and the profit margin is only 1-2 cents on average statistically.

    it is evident if you sell 1000 shares on sina, it will dent a hole immediately.
    Last edited: Dec 7, 2019
    murray t turtle and .sigma like this.
  10. wmwmw


    It doesn't need a few thousands traders to trade your way. One trader in charge of a billion in a fund could diminish your edge.
    Also he doesn't have to trade exactly like you, only to impact one aspect or one stage of your method could disable your whole method.

    Now answer two questions:
    1.Why TA methods do not work now?
    2. Why market is so difficult to beat?

    If you don't have answers, then you don't understand this market, and you don't have right answer to your own question.
    Last edited: Dec 7, 2019
    #10     Dec 7, 2019