Why Is The Obvious Not So Obvious?

Discussion in 'Risk Management' started by nysestocks, Jan 25, 2009.

  1. Sekiyo

    Sekiyo

    This thread is a tough read (lot of fluff)
    I can’t tell what’s the obvious unless …
    It’s something like cut your loss short, let your winners run and don’t fight the trend.

    However it made me think about stuffs I already said in the past:

    Over the long run a 1:1 reward to risk should yield a 50% win rate but on some occasions it will be hit 2/3 of the time. That’s when there is bias in the market which gives an edge.

    Since 1:1 can be hit 2/3 of the time (33%edge) thanks to bias then a 2:1 can be hit 1/2 the time (50% edge).

    I’d also like to quote some stuffs by Nysestocks from this thread:

    Most traders can't get their head around every trade being a loser, which is what it must be before it can be a winner!

    You trade when the chances of you losing a lot are small - the winners will then just become a matter of time!

    If you want an answer as to when you should "risk" more money than you would normally do so, it should be very "obvious" that the answer is when your chances of losing are far less than normal.

    you must BLASH and SHABL to make money, but the obvious is what enables you to do this with very low risk, and with a potential profit many times the initial amount risked!
    This is the essence of professional gambling - aka, trading!
     
    Last edited: Sep 25, 2024
    #8611     Sep 25, 2024
    zghorner likes this.
  2. zghorner

    zghorner

    im reading through this thread for the first time and the cryptic BS is mind numbing. I think OP is hinting at the simple path to trading successfully...whereas other known legit players say the real advantage is found within complexity. An example being Des recently recommended to me that the only chance you have in delta 1 trading is a macro approach. You have to at the very least consider that guys advice. Someone like him would glance through this thread and laugh their ass off...and no surprise he favors the complex with all of his inventive, uninterpretable options strats.

    Getting a handle on complexity requires complete devotion and borderline family sacrificing amounts of time. you listen to interviews with successful macro guys and they are constantly checking for info, intermarket correlation analysis, global events, everything...on alert all day and all night. The path of complexity checks out though IMO...you are putting in that extra level of effort that losing traders aren't willing to do and one should be rewarded for it.

    The simple path to successful trading sounds to me like basic gambling principles with maybe a bit of "zen in the markets" thrown in for mystic flair.

    All of the above of course is assuming the trader already has mastered the basic execution and emotional skills that (although aren't that easy to develop), really...IMO...just get you past level 1 with trading.

    idk...im going to continue to sort through it inbetween chess matches just because.
     
    #8612     Sep 25, 2024
    TVIS and Sekiyo like this.
  3. The Obvious is horizontal support and resistance, like what is continually taught by Scatty in the TA forum. It's so obvious most people overlook it as too simple to be of any use!

    And for a momo trader like myself, it is foolish to believe price will just hit a wall somewhere and bounce off it like an invisible barrier!
     
    #8613     Sep 25, 2024
    zghorner and Sekiyo like this.
  4. Sekiyo

    Sekiyo

    #8614     Sep 25, 2024
    zghorner likes this.
  5. zghorner

    zghorner

    downloaded and will read after another book i found from copying and pasting a quote from around page 50 called "Dynamic Thought"
     
    #8615     Sep 25, 2024
    Sekiyo likes this.
  6. schizo

    schizo

    C'mon, you peeps! The only obvious thing there is around here is to have an edge. It's not so obvious because clearly you don't have one. Why is that so not obvious? :sneaky:
     
    #8616     Sep 26, 2024
    Sekiyo likes this.
  7. Sekiyo

    Sekiyo

    Well it’s more like a 101 book on trading but it’s a good reminder xD

    Gotta check “Dynamic thought”
     
    #8617     Sep 26, 2024
    zghorner likes this.
  8. ironchef

    ironchef

    :thumbsup: He is a pro!

    I don't normally giving out trading advice but he is absolutely right for amateurs (like you and I). The microstructures he took advantage of is beyond our capability. If you understand what he said, you can be profitable in options.

    On the other hand IMHO day trading is completely different and requires a different mindset.
     
    #8618     Sep 26, 2024
    zghorner likes this.
  9. Sekiyo

    Sekiyo

    It is not about how often you are right or wrong, but it is all about how much money you make when you are right, and how much you lose when you are wrong.

    This.
     
    #8619     Oct 3, 2024
    themickey likes this.
  10. BLSH 90% of the time
    BHSH 10% of the time
    Trade from the perspective of other traderz, not your own
    The only performance metric worth watching is your equity curve!
    "Can you see the S?"

    *edit- the video of the bird on a branch is gone, and I never saw it back in the day, but I think it showed a very simple motion, back and fourth for a while until the bird flew away. You have to turn your monitor sidewayz to see this on a price chart!
     
    #8620     Oct 17, 2024
    ironchef and Sekiyo like this.