A few things... 1. The principle of "Keep doing what has worked and the market will eventually knock you on your ass". (Applies more to "theme" players than traders) IOW... "getting it right" is a "right now" kind of thing. We tend to think of star players in the "now" as truly star players... the ones who are smarter and will keep knocking it out of the park in the future. For the most part, that's wrong. Lots of examples. 2. The market changes. (See point #1) As a trader/investor, YOU have to be aware of change and adapt. 3. Lesson... "Keep trying to get it. When you do, make something of it. Always trade with stops. If you're going through a period when you're not doing as well as you like, keep as much of your capital intact as you can (stops) for the next time you get it right". 4. 80/20. Just as most traders' gains come from 20% of their trades, most players' CARRERS show the same 80/20. That is, your best years... 20% of all of your years.... will hold the lion's share of your career gains. It's worth a lot over time if the "80% not my best years" are somewhere between small losses and modest gains.... or better, if you can muster it.
Here is my take away: 1. Trade multiple strategies 2. Assume that at some point strategies will lose their edge 3. Use metrics to determine number 2 and remove strategies when necessary 4. Have pipeline for finding new strategies 5. Don't get blown out
prior to 2008 crash, banks and brokers and firms were investing more of their own money into the 'market' now it's all pension money or client money. that has way less margin. professional have 90% margins intraday and all the volume is professionals. professionals meaning people who trading is their main source of income or bread and butter.
The key basic takeaway from the 2008 mess...is to not use maximum leverage on crazy, weird, exotic bets. And everyone was drinking the same Kool-Aid. and buying and selling and transferring risks around to everyone else for commission. And to some degree, fraud and misrepresentation. What you have or had essentially was a Perfect Storm brewing for inevitable implosion. I guess...there are some correlated lessons from this event...that could be translated and learned for the retail trader. But more importantly, it's 2018...Make Trading and Your Life Great Again...High-Five`
Don't know how much experience most of you have regarding OPM, people redeem in big chunks, so might not have enough on hand so you have to liquidate positions even when you doing well against the Index. Plus, many trend manager are horrible at reading tops and short ES at wrong times to hedge. And many never want to hedge even though they think highs are close and they stop buying replacement stocks. Or they get tired of long hours. Great deal stress to produce.
Usually what happens with any successful trader is that their trading strategy gets copycatted until it no longer becomes profitable. Hence why traders protect their strategies with NDA’s and non-compete agreements. I’m not sure how shadowing a formerly efficient strategy would work, or how taking the opposite side would work. That would be gambling on expectancies rather than having an outright edge. Now, if you copied me right now you’d be very profitable, but 99% don’t have access to what I can trade. It’s not fundamentally different that what most retail trades, it’s just you have to have in place the proper permissions.
Every time you place a trade in FUTS your trader ID goes with the order file. CME requirement. Familiarize yourself with the TAG system. Market makers know exactly who's in at any given nanosecond of time, where they entered, averaging in, etc. and exploit this edge to the max. With today's technology Trading 'Supply /Demand' on too short a time or range frame is a recipe for disaster. Less trades, smaller size spread over several accounts, larger frames - swing trading. Market makers can turn on/off volatility with the blink of an eye. Much of 2017's price action demonstrated that rather clearly. Here's Tag 50 www.cmegroup.com/rulebook/files/cme-group-Rule-576.pdf
%% Good read,he admitted what he was doing was fun; then, for years it turned not profitable.WE cant blame it on his school, Harvard. IBD founder went there also.....
You cannot overestimate the impact of advances in technology used by the exchanges and their designated market makers in the changes seen since 2010. Market transitioning from floor to screen, availability of unlimited capital provided to corps to buy back their stock (hence drive up the market) and central bank participation (actually buying product to keep the market bolstered) led to some of the biggest manipulations of price action in the history of modern markets. Permabears and those trading a mean reversion strategy to the downside got taken to the cleaners in the process.