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  • #201
  • Edited 8:06pm Sep 21, 2017 7:32pm | Edited 8:06pm
One thing quants are good for, is mining for pairs relationship ship to do pairs trading, only reason why they fail is because they are rigid.

Because they only have plan A, no plan B for when it stops working.

What it can be used is for the strategy layer, not at a tactical level.

Basically whatever fti said about being rigid is where quants fall, the basic underlying strategy has some sound edge to work with, but when it tears up that's when you need to stop following it, that's where the trick lies.
  • #202
  • Edited 10:35am Sep 23, 2017 10:25am | Edited 10:35am
Courage, Might, Resolve and a little Luck is the sword that will lead one to great victories.

The reason why many people never succeed is not because of a lack of skill, but a lack of courage.

To be successful means to do what the average person cannot or do not do, then in a sense, before the person succeed it's going to seem like its Impossible or stupid. But do we all really have a crystal ball? Therefore resolve and courage is needed to never waiver until the result is out. Then adjust because that's what's required of the situation.
  • #203
  • Sep 23, 2017 11:00am Sep 23, 2017 11:00am
Hi CookieMonsta

Good to see you trying out your stuff, well done my friend.

ATTACHMENT…… no not in an email…

This is the biggest killer of profit/moving on for us in whatever we may do in our life,,, to the belief of/in something, to something we want, to what we THINK is right to do….. make your own rules and be willing to invent new things/ways of doing things, who says the ‘given’ way is the best and only way, people do it because they believe it is ‘safe’ in the herd…. Predators love to hunt the herds, all that food in just one place….. 95% <-- 5%.

Think about our friend fti’s stories.

Regards

Phil.
-be careful about what you allow to be put in your mind-
  • #204
  • Edited 11:50am Sep 23, 2017 11:33am | Edited 11:50am
Quoting phil13
Hi CookieMonsta Good to see you trying out your stuff, well done my friend. ATTACHMENT…… no not in an email… This is the biggest killer of profit/moving on for us in whatever we may do in our life,,, to the belief of/in something, to something we want, to what we THINK is right to do….. make your own rules and be willing to invent new things/ways of doing things, who says the ‘given’ way is the best and only way, people do it because they believe it is ‘safe’ in the herd…. Predators love to hunt the herds, all that food in just one place….. 95%...
Hi Phil,

Good to see you.

True true, in fact, I had to learn the lesson the hard way, and that was before I chanced upon the TAF thread.

What happened was, I was on medication for acne for retinoids which causes the skin to flake and become very dry, and the packaging also warned that if it came into contact with exposed skin or mucous membrane, stop immediately. Well I think I was sun burnt when still on the course of retinoids. And when I applied the cream on for the first time since the sun burn, it had an adverse effect, my skin got extremely red and the skin was peeling like crazy. So I then on purpose avoided it since I think that should not be how the medicine worked. But my guardian sort of saw it and started to scold me and insist I continue using the cream when I said no. Well at the end, we went to the doctor and he said that it was right to stop medicating immediately when that happened. Then and only then, did my guardian shut up, but did not even apologize or anything.

Well, I just let it go, because I felt my guardian was very egotistical and not one to apologise even in the wrong, but seriously, it can get fatal, it's a chemical we are dealing with.

That's why, thinking for yourself is always better.

Ego and anger and misinformation can actually kill.

Sometimes if bad and potentially harmful advice is given in a forceful way, lieing about agreeing then not following the advice is the best way to go.

I wonder if I would actually be disfigured or even fatally wounded if I had applied more of the cream on the sun burn because the package explicitly said not to.

Well that's 1 lesson that will always be burnt into my mind eh, nothing like physical injuries to etch the lesson into memory.

I guess I have nothing against people giving advice, in fact that is how I learn, just that I have a problem with people force feeding others with it when there are some information or evidence that it may be bad advise, especially so when it's not them who bear the consequences.

It's really back to the TAF lesson, flexibility. When the situation is changing, gotta learn to be flexible and adapt to it. It may not even be bad advise from others, and is a mistake from myself. Letting the error or mistake get really far out is the real killer.
  • #205
  • Sep 23, 2017 11:52am Sep 23, 2017 11:52am
Hi CoookieMonsta

We can only adjust to what we see in front of us my friend, that adjustment can re-adjusted many times.

You may like this if you have not chanced upon it before.. TAO TE CHING.

Dinner has just arrived…… KFC (kentucty fried chicken) ohhh, living the life ah..lol

Can’t have steak every night or it will get boring…

Regards

Phil.

Attached File(s)
File Type: pdf tao_te_ching_en.pdf   170 KB | 245 downloads
-be careful about what you allow to be put in your mind-
  • #206
  • Sep 23, 2017 11:48pm Sep 23, 2017 11:48pm
Quoting phil13
Hi CoookieMonsta We can only adjust to what we see in front of us my friend, that adjustment can re-adjusted many times. You may like this if you have not chanced upon it before.. TAO TE CHING. Dinner has just arrived…… KFC (kentucty fried chicken) ohhh, living the life ah..lol Can’t have steak every night or it will get boring… Regards Phil. {image}
Hi, phil,

Will take a look at it, it seems pretty long, thanks.

Yep, which is what fti has always been talking about, we can only adjust to what we see infront, but we still have to do the thinking, because see-ing is half the picture, the other half may be hidden under the surface.

Sometimes, the situation may not be as plain as it seems on the surface, or at least, thats what I felt like when i learn from the TAF thread.

awe man, you get to eat steak everyday? now im jealous
  • #207
  • Sep 24, 2017 1:49am Sep 24, 2017 1:49am
Quoting CookieMonsta
Courage, Might, Resolve ...The reason why many people never succeed is not because of a lack of skill, but a lack of courage. Therefore resolve and courage is needed ...Then adjust because that's what's required of the situation.
Hello CookieMonsta,

Again, an interesting thinking of you. In reflection, being myself rather timid or modest (one might name that cowardice as well), I may rely on the courage to respond to current situation. As might and resolve, one should feel enough confident in the flow read, sufficient resources and ability to adapt swiftly. What I can see as my lack of the Might and Resolve, it's mistrust that the flow picked up would run time wise long enough within my ability to respond. That's why the Intraday mindset, and it's limiting influence. That's why I'm restricted within my diet (Preservation of CAP, Stop Greed).
Actually, on the ant's route, I've set a target if I'm able to upgrade in six - seven months from now. Or admit that it's impossible to re-teach old dogs...

I'm eagerly looking forward to your successful breakthrough,

Best regards, Exnav
Not to Advance is to Fall Back
  • #208
  • Edited 4:35am Sep 24, 2017 2:08am | Edited 4:35am
Quoting Exnav
{quote} Hello CookieMonsta, Again, an interesting thinking of you. In reflection, being myself rather timid or modest (one might name that cowardice as well), I may rely on the courage to respond to current situation. As might and resolve, one should feel enough confident in the flow read, sufficient resources and ability to adapt swiftly. What I can see as my lack of the Might and Resolve, it's mistrust that the flow picked up would run time wise long enough within my ability to respond. That's why the Intraday mindset, and it's limiting influence....
Hi exnav,

What you indicated is not a problem of yourself, but a problem of time constraint and time resources. These are problems which everyone will encounter if they are not trading full-time as a professional trader or trading full time at home and employ a technique like Taf which require constant babysitting.

So it's not a problem with your skill, it's just a constraint on your time hence limiting your ability to fully unlock your skills to maximum. In this case, I do not think anything can be done except to change the mo to shorter term hit and run mo, or simply trade longer term with a smaller size, or employ other mo which can allow you to scale the time frame properly in a risk adjusted way.

It is not cowardice to gauge that, if the risk is too high and the returns are too small, then it is not financially prudent to carry on the current trading exercise. After all, it's not all no risk and all reward, the risk has to be renumerated enough by the reward if not it does not warrant taking on the risk.

Because after all the 3 main rules are, capital preservation, capital preservation and capital preservation. Sometimes if it really is not feasible, learning when to yield is a good choice too, sometimes it's a matter of not losing too much, just making the best out of a bad situation.

in truth, this is simply just a constraint you have to work out, regarding your best course of action, it is not indicative of your ability or your cowardice, just that you may simply not have to time to manage that far out in time frame.
  • #209
  • Sep 24, 2017 5:14am Sep 24, 2017 5:14am
https://www.youtube.com/watch?v=ugsS2_Z0wpA

the redirection of momentum, what you see here is the professional diffusing the attack then, moving to disable the attacker, see how fluid it is.

what many do not see, is that, this is a highly toned down form of martial arts, its highly efficient, no wasteful movements, basically, when you disable your enemy like that, he is a sitting duck.

notice how the professional use the attack by the enemy to create an opening, then throw the enemy off balance then counter attack and gain the upperhand from the opponent's moves and opening.

the same can be done in trading, the opponent's volatility and natural position.
  • #210
  • Sep 24, 2017 6:42am Sep 24, 2017 6:42am
the pairs correlation for equities is a long short trade, within correlated instruments/pairs.

notice that, for forex, because of the way the cross is quoted, the 3legged animal, is also called the triangular arbitrage relationship.

the butterfly is an extension of the 3 legged animal, but, personally, butterflies are used because the trader is very large and the market may not be able to take him, for the retail trader who wants to use such relationships to strengthen their trading, usually the 3 legged animal is optimal, between not having to deploy too many troops, vs having to deploy a per scout smaller unit size, and am able to optimize for better size vs opportunity cost.
  • #211
  • Edited 12:19pm Sep 24, 2017 10:12am | Edited 12:19pm
https://youtu.be/yzl7oX9FYGE

Interesting video. And anyone who has ever been in research will tell you, many of the things we know are not facts. They are theories, they have been tested, finitely, not infinitely and holistically, because we may not even know what we do not know, unknown unknowns.

The most classical one, Newton's law of motion, Vs Einstein, who is correct? Well, I don't know. But what Einstein did proof is that Newton has made some errors in his modelling of the world.

If people know the philosophy by George Soros and his then teacher, philosopher, Karl popper, then they would understand, that the sciences actually adopt a doctrine in which some of the "laws" are being empirically tested because they are so basal that there is no way to test these basic theories which lay the foundation of everything else, except by observation. Basically this means,

A+B=C is true by observation.

What if D existed? And it's actually A+B+D=C? Well since D was not in our model or knowledge, it was left out and there was no way to identify D unless technology got better.

So sometimes it's vested interest, sometimes, it's the blind leading the blind. Sometimes the truth may be covered up just to sell more products. And it's called "marketing".

https://youtu.be/KHaCKudtVi0

Many factors link to obesity, the answer may not be so straight forward as many think, where a fat guy is a couch potato. If you skin the surface, that's all you get, question and dig more, the answer is there.

https://youtu.be/5S6-v37nOtY

So yea, linear regression, problem was, it's was curve fitted data, some scientist can't face the fact that their research had turned fruitless, basically bad mindset, maybe they should make trading mindset lesson compulsory for people in high positions to impact society in general. And all they saw was garbage data, there really was no link between fats and people becoming far from eating fats, it was the sugar. Basic human biochemistry.
  • #212
  • Edited 2:58am Sep 28, 2017 2:47am | Edited 2:58am
Ah, the core strength in fti is I believe not easily seen in the thread.

And when I say core, I don't mean the material there, it's something more. I have a gut feel what it is.

It's not very easy to train, it's 10%knowledge 90%experience.

What I mean is think like fti.

Ah, so the strength can only be gotten from experience. With this maybe I will forever diverge from the taf thread.

The skills cannot be seen, for it is guts and experience and strategic thinking. It keeps getting simpler and simpler yet more and more elegant and more efficient.

So in order to become better I have to break free and take on my own evolution.

The 3 legged animal has never been mentioned much before, it's my own understanding of the thread's ro3k usage and potential.

If that's so, I will then I believe the ability to craft tools such as the ro3k and the 3 legged animal is my next stage in evolution, and going into options, and financial engineering, that is the next stage.

So in fact there are bad tools and good tools, and bad ways to use good tools and good ways to use good tools.

The key is training the good way to use the good tools, and ability to create the tools, that will be the next stage in evolution.

I can see where Fti's strength is now, it's hidden in the thread, not easily seen, what people gleamed is nothing but the surface.
  • #213
  • Edited 3:35am Sep 28, 2017 3:19am | Edited 3:35am
The key has always been terrain, that's the one you can't control, you can control your strategies and mm and instrument, deployment strategies and all, but if terrain doesn't work as per your expectation. Then it is still problematic.

Technically, once you can handle all forms of terrain and it's transition, it's fairly easy to handle the variances thrown by the markets.

So what comprises of terrain? To be continued.

The question is, what strategies are there to mitigate the kinds of situation which identifies each various terrain? To be continued.

Anyway personally, I believe I have not fully understood the meaning of terrain, just my gut feel, this is the final piece, to dancing 1 pair, 3 pairs or options or all other mo, it's always on terrain. So since I still made some mistakes, it's indicative of my ability to sense the terrain.

Terrain huh, I have to do more exploration on it, I only understood some segments of terrain, not all forms and transitions of terrain, I believe this is exactly where i am lacking.

The black and scholes formulae at its core has some elements trying to model terrain.
  • #214
  • Sep 28, 2017 5:05am Sep 28, 2017 5:05am
The basics in the taf thread are solid foundations, moving towards evolution does not mean moving away from the basic, it's just customizing the advanced stuff for your own usage.

All advanced stuff have to have proper foundation in the basics to be built upon hence, it's evolution rather than complete change.
  • #215
  • Sep 28, 2017 7:56pm Sep 28, 2017 7:56pm
The opening to rescue may not come till a very long time later, so if this is the case, an extended waiting time is required but meanwhile, the book is exposed to volatility.

The ability of the trader to succeed at these circumstances, depends entirely on their mm and logistics.

The key lies here, but is there an alternative way?
  • #216
  • Sep 28, 2017 9:30pm Sep 28, 2017 9:30pm
Well as I mentioned before Phil's demonstration is 1 way to manage the volatility.

I think we can't run away from the fact that in order to manage the volatility of the book, other ad-hoc strategies will have to be managed.

For mo which do averaging, they are dealer type mo, which will be about as volatile as the market. So their floating returns is pretty much mm size * market volatility.
Well logical conclusion is, who are the markets? Well the market makers. Hence their mo would correlate to markets volatility. And hence, being able to protect book from volatility is the key.
  • #217
  • Sep 29, 2017 1:57am Sep 29, 2017 1:57am
Hello My Friend,

Following your thread, I do agree regarding the Experience and, on the other hand, I can see you indicating: "Fti's strength is now, it's hidden in the thread, not easily seen, what people gleamed is nothing but the surface."

Let me make a brief comment on that: indeed, FTI strength was in 3 Pillars (Market Knowledge, You and CAP). While experienced at Tier 1 Bank (with all his strategies, RoK, Delta Hedge, some of them restricted etc.) he could use 500 M to safe 1 M with no Leverage; he had an exclusive access to corporate market data (which is impossible/ restricted for retailers). As dealers their MO was to close books by the end of every day, although and regardless all the priveleges (500 M cash, genuine/ confidential data and PRO skills), FTI himself admitted to, very occasionally but yet, have fought for two - three days to rescue/ respond/ win in crucial battles.

I suppose that we, TAF followers - retailers, should bear that in mind.

Best regards, Exnav
Not to Advance is to Fall Back
  • #218
  • Sep 29, 2017 2:17am Sep 29, 2017 2:17am
Quoting CookieMonsta
Well as I mentioned before Phil's demonstration is 1 way to manage the volatility. I think we can't run away from the fact that in order to manage the volatility of the book, other ad-hoc strategies will have to be managed. For mo which do averaging, they are dealer type mo, which will be about as volatile as the market. So their floating returns is pretty much mm size * market volatility. Well logical conclusion is, who are the markets? Well the market makers. Hence their mo would correlate to markets volatility. And hence, being able to protect...

Hi CookieMonsta

Yes my friend, and there you have it, the bit/part of trading we all neglect or fail to understand at first, dealing with the negative drawdown and volatility as part of our trading MO.

Our friend fti says
1. Protect book
2. Protect book
3. Do not forget rules 1+2
And our ONLY job as traders is to produce a profit.

My question was always how can I do this to create a consistent way of trading that did not lock me into long waiting periods while I recovered from either a badly timed entry or booked loss, as you have said there were hints from fti that there are ways to do this, I generally understood how with the long sword thing but fti said that is not for us as retail so I chose to look at other ways, hence my basic demonstration of my version of my findings and how I do it via the spot market, I believe you are the first and only one to really understand what I have shown there which is due to our MO paths being similar I believe.

Every moment in time is valuable so why should we just sit on our hands during most recoveries? I found the answers to this in AOW, we do not have too with the right strategies and tactics, sure we start every battle with war material from home/our own supplies but then the art is to forage on the enemy for sustenance to sustain our energy supplies for the battle we find ourselves in, as I said ‘attachment’ is the traders worst nightmare/enemy, why just because we start off in a long trade can we not change direction (by the varied way available to us, be like water comes to mind here), we all have choices and option during any trade we may take but mostly chose to restrict (attach) ourselves to one directional rigid either it is profit or loss trading, we are just ‘ants’ in this game but we act like we are ‘gods’ by forcing our directional bias and way of rigid profit or loss trading onto the pairs we trade instead of looking at the bigger picture to produce our only goal/mission (profit), then we wonder why we then fall into despair and rely on hope to save us.

A lot of this comes down to learning how to control our own minds and alter our way of thinking so we do not run on the autopilot of the chemical releases that makes act against our best options to be able protect the book (fight or flight mainly).

Regards

Phil.

Attached Image
-be careful about what you allow to be put in your mind-
  • #219
  • Sep 29, 2017 2:36am Sep 29, 2017 2:36am
Quoting Exnav
Hello My Friend, Following your thread, I do agree regarding the Experience and, on the other hand, I can see you indicating: "Fti's strength is now, it's hidden in the thread, not easily seen, what people gleamed is nothing but the surface." Let me make a brief comment on that: indeed, FTI strength was in 3 Pillars (Market Knowledge, You and CAP). While experienced at Tier 1 Bank (with all his strategies, RoK, Delta Hedge, some of them restricted etc.) he could use 500 M to safe 1 M with no Leverage; he had an exclusive access to corporate market...
Hi Exnav

my friend.

from my understanding positions where also often past through the shifts/teams and managed on an ongoing basis a lot of the time scaling in/out as the individual in charge at that time see fit, so the MO was very flexible for his traders as to the time allowed, we do not have that luxury as we must get some rest between our trading activity.

regards

Phil.
-be careful about what you allow to be put in your mind-
  • #220
  • Sep 29, 2017 3:10am Sep 29, 2017 3:10am
Quoting phil13
{quote} from my understanding positions where also often past through the shifts/teams and managed on an ongoing basis a lot of the time scaling in/out as the individual in charge at that time see fit, so the MO was very flexible for his traders as to the time allowed, we do not have that luxury as we must get some rest between our trading activity.
Hello Phil,

Thank you for kindly specifying it. It's true, on the other hand we, retailers, have luxury not to necessarily engage in all shifts at our own liberty. As I understand, Fti was supervising the shifts dealers (as they work 24/5 or 24/7) and he, presumably, referred to daynights (almost not sleeping at all) when he personally was involved (on his highest 3rd level, when the former 1st and 2nd level dealers failed).
What I wanted to bring is: that were not secret odds of FTI being PRO at Tier 1 - huge cash available, no leverage, no personal money (house at stake) in fight, covert bank strategies, restricted corporate market data. And then: it's difficult to teach old dogs...
Therefore, IMHO, our probably only advantage vs Tier 1 PRO is that retailer discrationary independence. For some and at times it's more profitable to stay away out from a coming storm (hidden in a calm serenity) or finding better way if too boring.

Enjoy your Friday trading,

Best regards, Exnav
Not to Advance is to Fall Back
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