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Admit it - your profits are based on luck

  • #101
  • Sep 19, 2008 6:35am Sep 19, 2008 6:35am
Quoting tdion
okay i'll make a deal with you.

prove that luck isn't a part of forex trading, and i'll leave the forums forever.

hint) you can't
Well, if you can prove that driving to work and back on the freeway each day is based on luck and not driving skill, I'll stop driving to work.

So much of daily driving well depends on remaining alert and ready to react to some maniac in a BMW or an out of control sewer sucking tanker.

Bottom line: if I get wiped out by a sewer truck, the shit will hit the road but within hours nobody gives a shit. I see Dopey's point now.
  • #102
  • Sep 19, 2008 6:40am Sep 19, 2008 6:40am
Quoting tdion
I'm really suprised I haven't had an outbreak of hate mail posted....

Maybe I am rubbing off on the factory


why are you still here?
  • #103
  • Sep 19, 2008 6:46am Sep 19, 2008 6:46am
Luck is when you start a thread like this and people respond to it, i would say your one lucky man tdion.
  • #104
  • Sep 19, 2008 7:03am Sep 19, 2008 7:03am
Quoting Dopey
You spend an inordinate amount of time on other people's opinions and views. You consistently challenge forum members to do something you want them to do, not what they want which is why no one ever responds to your challenges. Who really gives a shit what anyone thinks? Who really gives a shit what you think? No one except yourself. If you're convinced that trading is luck, then good for you. No one else gives a shit what you think...don't you see that by now. It doesn't matter if you're right or wrong, though it's quite apparent that you're very concerned with being right.

Just let it go and get on with your trading. If you make millions or lose every dime...who really gives a shit?

Just my humble thoughts for the day.

If he thought trading was luck in the simple sense of the word he wouldn't do it. I think tdions' point is that we should view trading results as a probability function. However one trade in isolation cannot be assigned a probability.

Returning to the poker analogy we may recieve a great run of cards which skews our probability of profit higher. Likewise market conditions may favour our system for sometime, whereas there could be barren periods. However price action is much more complex than poker as it is constantly in flux and not dealt to us in a discrete manner card by card. This is why we resort to candlestick ananlysis as we are then able to quantize the market and see it like the card player.

After a hand of poker has been played we can look at our opponents cards and work out the probabilities of each play in isolation. In the markets we cannot look at our opponents hand because we will never know who our "opponent" is and what their actions were. This means we can never assign a perfectly accuratre probability to the outcome of a trade.
  • #105
  • Sep 19, 2008 7:29am Sep 19, 2008 7:29am
I tend to agree with tom. Outside arbitrage, and to an extent mean reversion systems typical 'pick a direction' trading IS luck. To an extent. To me being lucky is nothing more than being on the positive side of randominity.

The technique a trader uses will aim to filter out the noise and achieve something better than 50% (assuming an even statistical distribution). The trouble with chart pattern watching to me is that people interpret charts in non random ways so they often don't even get 50% win rates because the market is often just a bunch of people trying to fake out everyone else, and they are better at faking you out then you are in picking a system that bypasses it.

If I were to start scalping, lets say LinuxTroll's system and get good at it my extremely short term predictive capabilities would probably be fairly good 75-90%. In that kind of time frame there is simply too much entropy for interbank dealers and other big boys to stop hunt you, fake you out, 1-2-3 fake outs, etc, etc. I don't scalp by the way, but if I was going to trade off charts I'd want to stack the odds my favour by starting with at least 50% winning chance before picking a system.

In developing a system I believe what we're attempting to do is to reduce randominity to a lower proportion of our results. That why I try to trade system where I don't need to have a market opinion(up\down).

"the egomaniacs will not concede that luck is a factor in their trading."

If I were a person who took market positions and had opinions I would call that taking responsibility for my decisions. I would try to fight the existence of luck, because luck would take from me the responsibility of running my system and give it to the market.
  • #106
  • Sep 19, 2008 7:29am Sep 19, 2008 7:29am
Quoting tdion
okay i'll make a deal with you.

prove that luck isn't a part of forex trading, and i'll leave the forums forever.

hint) you can't
The title of the thread is "Admit it - your profits are based on luck" which is not the same thing as "luck isn't a part of forex trading". That any trader's long term profits are based on luck is wrong and that I can prove with one word: CASINO.

A casino never loses in the long run because it has a well defined edge, "Watch the percentage", as Mr. Gronevelt would say (from Mario Puzo's "Fools Die"), "When a table doesn't pay, someone is stealing". The same thing with a profitable trader. Luck plays its part in any single trade, but over the long run bad luck cancels out good luck - luck evaporates - and what is left is pure skill.
  • #107
  • Sep 19, 2008 7:33am Sep 19, 2008 7:33am
Quoting tdion

I write EAs with the patterns in them

The bottom line is that trading is a spectator sport to me.
It might be a gambling spectator sport for you, for the rest of us it's a probability speculator sport.

How about you carry on gambling and writing your EA's with patterns (and trolling forums), and we'll just carry on trading.

There, now everyone's happy
  • #108
  • Sep 19, 2008 10:07am Sep 19, 2008 10:07am
Quoting Ted1983
If he thought trading was luck in the simple sense of the word he wouldn't do it. I think tdions' point is that we should view trading results as a probability function. However one trade in isolation cannot be assigned a probability.

Returning to the poker analogy we may recieve a great run of cards which skews our probability of profit higher. Likewise market conditions may favour our system for sometime, whereas there could be barren periods. However price action is much more complex than poker as it is constantly in flux and not dealt to us in a discrete manner card by card. This is why we resort to candlestick ananlysis as we are then able to quantize the market and see it like the card player.

After a hand of poker has been played we can look at our opponents cards and work out the probabilities of each play in isolation. In the markets we cannot look at our opponents hand because we will never know who our "opponent" is and what their actions were. This means we can never assign a perfectly accuratre probability to the outcome of a trade.
I wasn't debating the role of luck in the markets...I'm quite capable of making my own judgments on issues such as these.
  • #109
  • Sep 19, 2008 10:47am Sep 19, 2008 10:47am
Luck plays its part in any single trade, but over the long run bad luck cancels out good luck - luck evaporates - and what is left is pure skill.[/quote]

And how many trades do you need to take to be in the "long run?" 10k, 100k? From blackjack I know that you need to play over 300k hands to insure that you reach "long term" expected goals. There are no long run profitable blackjack players (unless you are proficient at counting, spooking, or something else that gives you an edge). Also, there are no long run profitable forex traders. Maybe someone out there has done gound breaking work (like Dr. Thorpe on blackjack), but if so, they are keeping that research to themselves.
  • #110
  • Sep 19, 2008 11:41am Sep 19, 2008 11:41am
FOR THOSE OF YOU WHO DONT BELIEVE SKILL MAKES YOU PROFIT:

1) if you dont think trading is profitable, why are you on a trading forum?

2) if you believe trading can be profitable, but dont think skill has anything to do with it, why are you on a trading forum? why not flip a coin.

Learn to trade. stop discouraging others.
- nick andre -
  • #111
  • Edited 12:35pm Sep 19, 2008 12:10pm | Edited 12:35pm
I guess all those 1KT vouches are people that disagree with me.

And apparently you are trolling my thread.

Lostinspace, what's your point?!

Quoting lostinspace
It might be a gambling spectator sport for you, for the rest of us it's a probability speculator sport.

How about you carry on gambling and writing your EA's with patterns (and trolling forums), and we'll just carry on trading.

There, now everyone's happy
  • #112
  • Edited 12:27pm Sep 19, 2008 12:12pm | Edited 12:27pm
Are you saying you disagree with post #1?

Quoting Nick_likes_pips
FOR THOSE OF YOU WHO DONT BELIEVE SKILL MAKES YOU PROFIT:

1) if you dont think trading is profitable, why are you on a trading forum?

2) if you believe trading can be profitable, but dont think skill has anything to do with it, why are you on a trading forum? why not flip a coin.

Learn to trade. stop discouraging others.
  • #113
  • Sep 19, 2008 12:15pm Sep 19, 2008 12:15pm
Dopey....

The purpose of the thread was to get people to stop and think. If it didn't do that for you, "I don't give a shit."
  • #114
  • Sep 19, 2008 12:23pm Sep 19, 2008 12:23pm
This is way off of the thread's topic.

Quoting Rosscub
Why not just ask us to prove that every minute price movement on a chart isn't ordained by God?
  • #115
  • Sep 19, 2008 12:27pm Sep 19, 2008 12:27pm
the facts

once you click buy or sell you are at the mercy of the markets.

but for those of us with an edge, believe me you don't feel lucky when you win, or unlucky when you lose. Period. You just trade.

all this talk of defining words such as luck, gambling, etc....waste of time if you ask me. Learn to trade is all that matters.

But if it makes it easier on some I have no problem saying I am lucky. I had one hell of a lucky september then
  • #116
  • Sep 19, 2008 12:33pm Sep 19, 2008 12:33pm
not everyone is fortunate enough to have (or ever find) an edge, mike.
  • #117
  • Sep 19, 2008 12:36pm Sep 19, 2008 12:36pm
Quoting tdion
not everyone is fortunate enough to have an edge, mike.
yes of course, and that is why I said those need to focus on learning to trade more then defining words

These types of threads have just been beaten so deep into the ground around here and they ALL end up in the same spot.
  • #118
  • Sep 19, 2008 12:38pm Sep 19, 2008 12:38pm
Quoting tdion
not everyone is fortunate enough to have (or ever find) an edge, mike.
having a edge comes from learning and understading the market, some never learn or get that edge and they become part of the 95% loosers.
  • #119
  • Sep 19, 2008 12:40pm Sep 19, 2008 12:40pm
What does this mean, exactly?

Quoting Prettyboy
"learning and understading the market,"
  • #120
  • Sep 19, 2008 12:41pm Sep 19, 2008 12:41pm
Quoting tdion
What does this mean, exactly?
,
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