91–100 of 169 posts
(This goes double for HFT.)
Guys, you are missing the mark on technical analysis. It's not about forecasting where the prices are going to be, it's about forcing yourself to follow a set of rules instead of following your emotions. There was an article on HN sometime ago about the practices of some old tribe to choose where to sow the crops for the next year. The practices were totally random, like watching the clouds, where a bird would fly, e…
I guess this is only written for other traders? I couldn't make much sense of it and got bored pretty fast.
Earlier quoted context omitted.
You sound like the people I've seen on gambling forums postings about their unbeatable roulette system that they've "really won with in the long term".
There are actually ways to beat roulette. 1. Observe the motion of the ball and the wheel between the time they start moving and the time betting is closed, and use physics to calculate where the ball is likely to land. Bet accordingly. This was proven effective in the early '80s [1]. 2. Record a lot of outcomes on a given wheel to learn its biases. Bet accordingly. You might think it would be hard to surreptitiously…
I guess this is only written for other traders? I couldn't make much sense of it and got bored pretty fast.
That's how most of us feel when we see articles about SF real estate or politics :-)
http://www.nytimes.com/2011/10/23/magazine/dont-blink-the-ha...
"Mutual funds are run by highly experienced and hard-working professionals who buy and sell stocks to achieve the best possible results for their clients. Nevertheless, the evidence from more than 50 years of research is conclusive: for a large majority of fund managers, the selection of stocks is more like rolling dice than like playing poker. At least two out of every three mutual funds underperform the overall market in any given year.
More important, the year-to-year correlation among the outcomes of mutual funds is very small, barely different from zero. The funds that were successful in any given year were mostly lucky; they had a good roll of the dice. There is general agreement among researchers that this is true for nearly all stock pickers, whether they know it or not — and most do not. The subjective experience of traders is that they are making sensible, educated guesses in a situation of great uncertainty. In highly efficient markets, however, educated guesses are not more accurate than blind guesses. "
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Hey Jbuzbee, This is what I thought as well when I was initially introduced to the idea of technical analysis and day trading. I was very skeptical. I don't want to call myself a probability expert but after studying poker theory and reading mainstream works like Fooled by Randomness, I bought into the idea that it was just a bunch of a guys throwing darts and the "winners" whom were trying to sell all their BS were…
> Being net positive 80% of all days traded with all your winners and losers falling in a relatively tight distribution -- luck can't create highly specific, repeated outcomes like that. Yes, it can. E.g. you could sell deep out-of-the-money puts and collect a $1 premium day after day, say 99% of all days. Until one day a {terrorist attack in the US, humongous earthquake in Japan} happens and you lose more money than…
I lost a shit ton of money at the firm where I work right now almost a year ago. I wrote software that began issuing trades outside of where it was expected to and did not stop. In a panic, I forced the server it was running on to terminate its process but trades were still open in the market. They had to be manually closed. I feel sick to my stomach even writing this right now, that hour I was trying to fix the prob…
HFT doesn't really add value to anything in my opinion (cue the arguments that HFT somehow adds real value to our society). Yet HFT creams a profit by shuffling money around very quickly. So if there are sometimes big losses like this from a bug, then it seems to even things out somewhat.
Guys, you are missing the mark on technical analysis. It's not about forecasting where the prices are going to be, it's about forcing yourself to follow a set of rules instead of following your emotions. There was an article on HN sometime ago about the practices of some old tribe to choose where to sow the crops for the next year. The practices were totally random, like watching the clouds, where a bird would fly, e…