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Ridiculous Trading Myths

  • #101
  • Nov 6, 2010 10:53am Nov 6, 2010 10:53am
Couldn't agree more. I just taught one of my good buddies how to trade last month. It took me a Saturday afternoon to teach him and he is killing it on a demo account currently. He had no previous knowledge of the forex market but saw what I was doing. His quote to me two days ago - "I can't believe that this is all there is to it, why doesn't everybody do this?". I said I have no idea. That being said, I just have to make sure he doesn't get too overconfident with the market and start making bad decisions.
  • #102
  • Nov 6, 2010 10:58am Nov 6, 2010 10:58am
Quoting hubbahubba
Is there a double meaning there perhaps? Ie...quantum physics?
"Ex Nihilo" = "out of nothing"

Maybe that's what Quantum physics is trying to tell us - that everything comes from nothing and will ultimately return there. What the h*ll that might have to do with trading, if anything, is anyone's guess. (Profits come from nowhere and will return there. LOL)
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #103
  • Nov 6, 2010 11:19am Nov 6, 2010 11:19am
Quoting hanover
2. Quantity versus quality of time..
Great Points Particularly this one

EDIT: I think points 2 and 3 are vitually the same thing.
Time hides Nothing
  • #104
  • Nov 6, 2010 11:26am Nov 6, 2010 11:26am
Quoting CindyXXXX
haha exactly, it comes back to the person and what they are trying to achieve and how they are trying to achieve it.
The 10,000 rule is BS IMO - everyone is different.
most definitely.
it's 1 of those things that i place in the 'general rule' category, or simply put, a generalization.

i love outliers & outlying
  • #105
  • Nov 6, 2010 11:59am Nov 6, 2010 11:59am
IIRC, the 10000 hour rule followed from a study on the characteristics of high performing and other students at a conservatory. The author found that the "experts" studied harder than their counterparts, and that there was roughly a 10k hour threshold.

Besides the good points mentioned by Hanover (I do believe that objection #3 can prolong or shorten a path, but should be reflected in the general statistic), there are many objections to such a research. For example, where lies the causality? Do people that study 10k hours become an expert, or do talented people naturally study more (10k hours)? For the time being, assume the latter is the case. There are many people that now believe that in order to become an expert, they have to invest 10k hours. This implies that the 10k hour rule may be based on a self-defeating statistic, as talent that used to study 10k hours is now joined by an untalented mass that wants to become an expert but never will, because they lack underlying fundamentals.
The nail that sticks out gets hammered back in
  • #106
  • Nov 6, 2010 12:04pm Nov 6, 2010 12:04pm
Quoting fxhermit
The "Holy Grail" of all myths is that trading must be complicated in order for it to be profitable.

Seeing CrucialPoint posting here reminds me of his very good thread (one of the best on FF, IMHO) that he used to post to. Well worth the read if you haven't done so yet. http://www.forexfactory.com/showthread.php?t=215432

In that thread he makes some very astute observations about reducing things to their simplest (as per Einstein's quote). He also makes mention of the importance of trend and references some past master traders and...
Biggest myth: There is a secret formula, an elegant equation, but you are not allowed to talk about it, other wise you get told to shut up.
  • #107
  • Nov 6, 2010 12:25pm Nov 6, 2010 12:25pm
Quoting Four Kids
Biggest myth: There is a secret formula, an elegant equation, but you are not allowed to talk about it, other wise you get told to shut up.
Yes, there are some "oddities" in that thread as well. I didn't get what that was all about (nor do I care). Never the less, some very applicable info (simplicity, trend) in that thread.
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #108
  • Edited 12:53pm Nov 6, 2010 12:42pm | Edited 12:53pm
Quoting Four Kids
Biggest myth: There is a secret formula, an elegant equation, but you are not allowed to talk about it, other wise you get told to shut up.
How can you disprove this?

I think the biggest myth is that there is no holy grail... Just hear me out!

I dont waste my time searching for it, but what can I say Im a believer!

Wheather its through manipulation by a privaleged few or a true discreprecy in the system I believe its out there, but good luck finding it.

It would probably hide in a formula long enough to wrap around the world 3 times, who knows

Maybe no one knows it because its simply too big for the human mind. Never the less it may be there and so cannot be dismissed so easily

But concluding something doesnt exist when you really have no way of knowing really is small minded I believe (not talking abou you FOURKIDS) just anyone in general. If everyone thought like this we would still be driving horse and cart and mapping the world as flat.
Time hides Nothing
  • #109
  • Nov 6, 2010 12:45pm Nov 6, 2010 12:45pm
"we would still be driving horse and cart and mapping the world as flat."

Ahhhh ...... don't you just long for the good ol' days, life was so much simpler then .... or is that just a myth?
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #110
  • Nov 6, 2010 12:48pm Nov 6, 2010 12:48pm
I doubt this wil ever be an issue - the untalented and those that dont really want it won't work this hard - 10K hours is a lot... if an untalented wants it bad enough - they become talented.


Quoting Noloqy
This implies that the 10k hour rule may be based on a self-defeating statistic, as talent that used to study 10k hours is now joined by an untalented mass that wants to become an expert but never will, because they lack underlying fundamentals.
In trading, there is no bullshit. You either make money or you don't.
  • #111
  • Nov 6, 2010 12:57pm Nov 6, 2010 12:57pm
Quoting CindyXXXX
How can you disprove this?

I think the biggest myth is that there is no holy grail... Just hear me out!

I dont waste my time searching for it, but what can I say Im a believer!

Wheather its through manipulation by a privaleged few or a true discreprecy in the system I believe its out there, but good luck finding it.

It would probably hide in a formula long enough to wrap around the world 3 times, who knows

Maybe no one knows it because its simply too big for the human mind. Never the less it may be there and so cannot be...

OK, I will keep an open mind about the first part of the myth. What about the second part, that people who know this magic secret formula, are not allowed to talk about it.
  • #112
  • Nov 6, 2010 12:58pm Nov 6, 2010 12:58pm
To me, the 10k rule is just another way of saying that there is no substitute for experience. Although that may be true, it doesn't necessarily follow that success cannot be achieved well before gaining that amount of experience. Ultimately, I think, the goal is to have both.
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #113
  • Nov 6, 2010 1:04pm Nov 6, 2010 1:04pm
Quoting Four Kids
OK, I will keep an open mind about the first part of the myth. What about the second part, that people who know this magic secret formula, are not allowed to talk about it.
Yeah, I don't get this ...... is the Mafia gonna rub you out??? Hell, just make an e-book out of it, give it a stupid name (Forex Slayer), attach a few rehashed indicators and sell through Clickbank. Oh wait, its already been done.
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #114
  • Edited 1:38pm Nov 6, 2010 1:24pm | Edited 1:38pm
Quoting Four Kids
OK, I will keep an open mind about the first part of the myth. What about the second part, that people who know this magic secret formula, are not allowed to talk about it.
EDIT: to the above I should have said close minded not small minded!

Whos stopping them?

Ive seen a few very interesting threads on this site and they do seem to get shut up very quickly. Certain topics arent talked about as regularly as they should be if quality is what we're actually after.

Its a free world people can talk about what they want but in a zero sum game I think people catch on pretty quickly about not revealing certain things.

As for magic secret formula I would say its more about secret ingrediants and I think they would make more friends by not revealing these definetly. Theres no need to scream from your roof top to your neighbours that you just found a gold mine on the hill. Unless of course you're trying to sell the hill

For profit motivated people as we all are most likely, this would not be wise at all.

This is why i tend not to listen to anyone anymore simply cause 1) if they're onto something then the cats out of the bag and will prob reach an equilibrium at some point anyway. And 2) if it was worth sharing in the first place then why on earth are they sharing it.

Maybe this is me being close minded now, but I dont care, this is what works for me. Simple observation, much thought and practice, will get you ahead IMO not misguided direction from random lines of thought from strangers.
Time hides Nothing
  • #115
  • Edited 1:46pm Nov 6, 2010 1:35pm | Edited 1:46pm
"If I just had enough money to invest, I could tell the market where I wanted it to go."

There's a couple of Rookie Discussion threads on this one.
  • #116
  • Nov 6, 2010 1:45pm Nov 6, 2010 1:45pm
Quoting CindyXXXX
EDIT: to the above I should have said close minded not small minded!

Whos stopping them?

Ive seen a few very interesting threads on this sight and they do seem to get shut up very quickly. Certain topics arent talked about as regularly as they should be if quality is what we're actually after.

Its a free world people can talk about what they want but in a zero sum game I think people catch on pretty quickly about not revealing certain things.

As for magic secret formula I would say its more about secret ingrediants and I think they...

The western world is supposedly free, but there are other countries where your life does depend on keeping your mouth shut on certain subjects.

Back to the myth. Why come onto a forum bragging about possession of a secret formula, and then in the next sentence say "I'am not allowed to talk" about it?
  • #117
  • Nov 6, 2010 1:47pm Nov 6, 2010 1:47pm
From the Random House dictionary:

myth (mith), n.

1. a traditional or legendary story, usually concerned with dieties or demigods.
2. a story or belief that attempts to explain a basic truth.
3. a belief or subject of belief whose truth is accepted uncritically.

Funny how all three are applicable to the Forex market.
1. often thought of as a diety unto itself
2. fundamental analysis
3. technical analysis
Stay calm, be brave, wait for the signs - Jasper Friendly Bear
  • #118
  • Nov 6, 2010 1:52pm Nov 6, 2010 1:52pm
Quoting Four Kids
The western world is supposedly free, but there are other countries where your life does depend on keeping your mouth shut on certain subjects.

Back to the myth. Why come onto a forum bragging about possession of a secret formula, and then in the next sentence say "I'am not allowed to talk" about it?
haha - could be many reasons... But egos in the money making world run rampert and I think this may have something to do with it.

I hate the one where someone says something, then another person says

"ohhh no you've let the cat out of the bag now",

and then they respond by saying

"oh dont worry 99% of people that read this wont get it any way"

This makes them feel smarter than everyone else and this is surely all they're after...


When in truth, if 99% of people dont get it they have probably just spoken in riddles and not explained it sufficiently to get anything out of it anyway. But it doesnt bother them haha they got what they were after.
Time hides Nothing
  • #119
  • Nov 6, 2010 2:00pm Nov 6, 2010 2:00pm
Quoting CindyXXXX
haha - could be many reasons... But egos in the money making world run rampert and I think this may have something to do with it.

I hate the one where someone says something, then another person says

"ohhh no you've let the cat out of the bag now",

and then they respond by saying

"oh dont worry 99% of people that read this wont get it any way"

This makes them feel smarter than everyone else and this is surely all they're after...


When in truth, if 99% of people dont get it they have probably just spoken in riddles and not explained...
Yes indeed, ego's are rampant in this game. I know mine is bloody huge, and I don't try and be humble about it.

Another myth there: You must be humble to succeed at FX.
  • #120
  • Nov 6, 2010 2:02pm Nov 6, 2010 2:02pm
Re the idea of a secret 'Holy Grail' formula, exactly what form would it need to take?

Think about how markets operate: belief systems and sentiment that create orderflow. Know where every order is currently placed, and its size, and you're part way to the holy grail. Know what action every player (or at least those whose pos size is large enough to impact price movement) is about to take, and only then do you have it.

By way of an anecdotal example, in Trading in the Zone Mark Douglas tells a story of a capable analyst who was hired by a large firm. The analyst explained to his new boss how he could predict turning points repeatedly with amazing accuracy by using certain types of support and resistance levels. When soybeans price reached a major support level, his boss said to him "OK, what you're saying is that price can go no lower, right?" The analyst said "Absolutely. This is the low of the day". His boss immediately picked up the phone and said "Sell two million beans at market", and within 30 seconds, the soybean price had dropped another 10c. The boss said "Now where did you say price was going to stop? And if I can cause that, anybody can".

That's why whenever I see somebody claiming a 99%+ win rate (e.g. here), over a large enough sample size, and assuming reasonable RR (e.g. 1:1) and no Martingale-like MM sleight-of-hand, I think it's safe to assume that they're blowing smoke, and of the billowing, toxic, ego-driven kind. Or put another way, I believe that there's sufficient randomness in price movement to ensure that there's an upper limit to the efficacy of ANY system. I'm not trying to be negative, just realistic.
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