The Journal of Finance, I believe, had an article several 7 or 8 years ago that showed that it took about 3 years for an 'edge' to become marginalized. The author showed the publication of several trading system/approaches and the profits before and after the publication. Long Term Capital Mgmt's early success was copied by other funds and started to eat into LTCMs profits. (Many LTCM experts on this forum, am I incorrect here?) If you look at the history of gambling edges such as 'card counting'. As soon as there is any success with a technique followed by discovery of the edge, the edge is gone or at least harder to exploit. "Would you share a trading idea?" I think you must handle a 'true competitive edge' (which can be verified, tested, and exploited) against a 'market observation/belief/opinion'. I would not share an edge I worked hard to produce; always glad to share an observation/belief/opinion. Sure, why not?
Every successful fund that I know of, e.g., Rentec, DE Shaw, Steve Cohen, Citadel, Doyne Farmers group, etc, are amongst the most secretive firms in regards to their trading strategies that I know. I don't talk about the way I trade - not even to friends. I have no problems showing my positions though. The only way I would ever disclose my research would be if I were to go into partnership with someone that I trusted and both our moneys were at stake. nitro
I'm with Pabst and nitro and everyone else of like mind on this one. And although my method is not as profitable as some of the people on ET claim theirs is, I would not share the specifics with anyone. Once I did that, it would no longer be exclusively my own even though I'm the one who put in all the work. As for the vendors, I doubt that they are disclosing their best stuff if they do indeed trade. As for everyone who disagrees, this thread is an excellent opportunity to put your money where your mouth is and provide all the details of your own trading methods. We're listening.
Yes! Thank you, Pabst, you are truly becoming my hero. I was thinking the exact same thing. babar, you mention tony oz like he's a trading legend, when in fact, he's merely a vendor and a shill, nothing more. And you know this to be true. Prove to us that tony oz is a legitimate trader. Let's see his track record, or anything that backs up that he's real. Otherwise, you are one warped vermin.
Pabst, the ideas that the 'vendors' disseminate are the same ones the continue to use to make money. But lets leave them aside. What about all those who aren't vendors? Just a laundry list: Woodies CCI, Praetorian's GNP, Maoxian's 'dummy trades', my end of year plays, etc... These and more have been shared with all to see. Yet, for all the clear examples and explanations given, how many have the conviction (and balls) to play a GNP, for example? Exactly. Sure, there are some mechanical stuff (black box) which people like DE Shaw would never share but I'm referring to discretionary stuff. I truly believe that the key is not latching on to one 'thing' but to continuously seek knowledge. The market is ever changing, that is the only way great traders stay ahead and make it. The amateurs are looking for an easy system or play, the pros are looking for knowledge and mastery - that's why they'll be light years ahead always.
Babak>You hit a point. If you have discretionary elements your edge may very well remain. For example, WoodieCCIs have been out there for a while....but it still works (never tried it myself but have seen people doing well with it). However if a black box trader hands away his/her strategy, it is the equivalent of commiting hari kari but instead of dying instantly...the trader dies a slow, painful death.