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What's the point of hedging?

  • #181
  • Nov 8, 2011 9:27pm Nov 8, 2011 9:27pm
Quoting iulli
Appreciate your answer.. and I agree with some of your points, if you would trade 100000 dollars 20 % draw down means hell it is actually unthinkable.. but believe it or not he survived more than one year and actually made money ( a Little), you must recognize this is better than majority...
iulli i don't AT ALL dispute that bob has scratched a few coins out of his endeavors. what i dispute is just about everything bob so-called 'teaches'. just look in this thread re his take on hedging. he doesn't know the things he speaks of. not just here... anywhere. his little tribe of followers seem to always be new members, and who often straight out of the gate show that they themselves know so little.

bob appeals to the lowest common denominator. the fact is that anyone who populates an account with enough margin can trade randomly and probably perform comparably to bob, if not outperform if they use a little bit of clout. bob thinks he is onto the winning ticket.... but he is just churning randomness and picking up pennies along the way. that's no way to get ahead, and his misinformation is truly a sight to behold. bob's ego has blinded him and it's not just myself who has called him on his crap and shown with proof why certain things he claims are ass-backwards.... which he ignores and goes on his merry way pretending to be a trader.

if i start a thread with my nubcake 1.0 alpha EA and start talking absolute nonsense and 'teach' outright 'lies'.... i don't care how many sheeple i get following me.... i expect someone to call me on my bullshit and show why i'm wrong.

i'm not the only one to call bob out on his continual delusions, however, i am the one who gets the most kick out of it at this time so i'm more vocal than others. each time bob sticks his head out of his fairy-land and continues dribbling more misinformation he should expect to get smacked with the truth. it just so happens that it's been me doing it mostly recently.

i don't know about you, but i have a general distaste for false prophets and being asked to chew on crap as though it's caviar.

the proof is in the pudding. i don't know the actual answer to this, but i have my educated guess.... i wonder how many newbies populate bob's threads, and how many actual traders who make a living from trading populate bob's threads? when most of the 'chatter' is from people who popup out of the woodwork with under 10 posts then it's a pretty big signal as to the situation.
Congratulations ScalaFX for coming out of the closet!
  • #182
  • Edited 9:48pm Nov 8, 2011 9:29pm | Edited 9:48pm
Quoting nubcake
i suppose you are satisfied with a 'teacher' teaching children that 1 + 2 = 9, or that water is made up of magic. bob's system is what it is... .
On a second look totally agree with you, if he would really not calculate his deposits as deposits. But He is smart he would not do this kind of mistakes. What it matters in the end is profit, you make money or lose money. If you make money.. How much. He is trading a Penny account. If he makes (as he says)100-200 dollars a week in profit (real profit) that is 400-800 dollars a month with risking just 1000-2000 dollars in your account. I think this is awesome. That actually shows he has some skills. And if you do this for more than a year.... think about it.

Hell yes is worthing, People buy homes (investing maybe hundred thousands dollars) to get rent of 800 dollars a month.

It is true He might go bust sooner or later loosing his deposits, but he is making money now this s what matters. Of course his strategy is not god for big amounts of money, the risk is to high...

P.S Agree - instead of hedging (as they call it) just take your losses and move on, hedging is just an illusion that you don't take a loss, the loss is still there you did not eliminate it, you are just dealing with it later paying more spread (by opening and closing extra trade to hedge)
  • #183
  • Nov 9, 2011 12:14am Nov 9, 2011 12:14am
Quoting normfx
Hi Dave, ...... Now I know you have a lot of influence with the beagles (they seem to love you, dunno if that's a good thing lol)..would you do me a flavor and call them off..they will listen to you..actually, you don't have to say a word..they'll read this and get the point..hate to see "good" traders attacked just for fun..I'm sure you'll agree. - Thnx Norm
Norm,

Don't expect too much in the way of reasoned discussion from the beagles; it seems that they post primarily to entertain themselves. However, Bob insists upon replying, which merely fuels the next wave of attack. The debate reached an impasse many posts ago (this is a carry over from what began in the "SL vs no SL" thread), apparently because neither party understands where the other is coming from. At least that's how it seems to me.

Is the persuasiveness of an argument enhanced by repeating the same tired old points over and over? Propagandists apparently believe so, but I beg to differ.

I've come to believe that the only way forward in forex is to have an edge that's grounded in the hows and whys of market behavior, and I don't see a lot of that in Bob's posts. But to be fair, Bob has put in many hours of his own research (and is very generous in sharing it), and I haven't studied his more recent threads, hence I'll happily withhold any judgment.

David
  • #184
  • Nov 9, 2011 12:28am Nov 9, 2011 12:28am
Quoting hanover
I've come to believe that the only way forward in forex is to have an edge that's grounded in the hows and whys of market behavior, and I don't see a lot of that in Bob's posts. But to be fair, Bob has put in many hours of his own research (and is very generous in sharing it), and I haven't studied his more recent threads, hence I'll happily withhold any judgment.

David
David,

My take is that Bob (feel free to correct me Bob; Beagles, I am making kitty noises) is an indicator kind of guy. He spends a lot of time tinkering with all the different things that show what the market has just done. I also have to think (whether by intent or accident) that he is aligned with market behavior or the market would have washed him out some time ago.

To be fair, I understand your definition of "edge" to be very specific and narrow. Good entry, good exit, nothing more. Use of stoploss and hedges are outside the parameter of both. Well you might argue for the exit issue...

Aaron
Kill the ego, or it will kill the mission.
  • #185
  • Nov 9, 2011 12:31am Nov 9, 2011 12:31am
plenty of reasoned discussions hanover. do you not pay attention? just because bob ignores reason doesn't mean you must. i don't fault you since a lot of the reasoning gets put in the bin by mods who would rather have bob continue his newbie-enticing posts filled with fairy-tales and bubblegum. perhaps you missed it.

have an opinion for once. it's ok to say that bob is full of shit, or nubcake is full of shit, or whatever it is you have deduced.

or, just because bob claims to have done lots of research does this mean that his nonsense somehow becomes truth by default? is everyone else wrong, and also has no one else done research as well? is bob the only person with the right to truth as he sees it simply because he posts supposedly openly (yet won't answer regarding certain accounting methods he surely employs)?

lol. step up to the plate and have a swing... you might enjoy it, or does that 'commercial member' tag prevent you from speaking your mind, which is fair enough i guess?

aaron : see, sometimes you give me hope for you yet. keep sniffing around and you'll put the pieces together and see what the beagles see.
Congratulations ScalaFX for coming out of the closet!
  • #186
  • Nov 9, 2011 2:48am Nov 9, 2011 2:48am
Quoting nubcake
it's ok to say that bob is full of shit, or nubcake is full of shit, or whatever it is you have deduced.
Nubs, I wasn't sure whether you were officially a beagle or not. Honestly, I haven't probed too deeply into either your trading systems, or Bob's trading systems, hence if I was to say "XYZ is full of shit", it would at best be unsubstantiated guesswork.

I try not to throw the baby out with the bathwater. Just because a person has one great idea, doesn't necessarily mean that he's right about everything else. Conversely, just because I disagree with one post, doesn't mean that I automatically write its author off altogether. IMO more progress is made developing ideas rather than assigning either kudos or blame to people; and by asking the right kind of questions, rather than purporting to have answers to everything.

IMO, you're a very smart guy. I've no doubt that you know a lot more about Bob's approach than I do. I could read Bob's threads from start to finish, but I'd rather spend my time developing my own ideas further, and doing other stuff (mainly programming). So (and I'm sorry if this sounds selfish or unkind) it doesn't really bother me whether Bob is right or wrong, or whether he's profitable or not.

Quoting nubcake
have an opinion for once.
OK, I'll tell you something I do have an opinion about: I'm much more knowledgeable about the hows and whys of price behavior than I was 2 years ago. But why try to teach anything here (I don't have the time, in any case) and run the risk of being gang raped like Bob has, by a pressure group that might hold different views?

For the record, I strongly believe in the use of SLs (as a predominantly S/R trader I probably use them more aggressively than the vast majority do), and I don't believe that nedging offers any strategic or mathematical advantage (just repeating myself for the 999th time here). So Bob and I might sit on opposite sides of the fence on both of those points. But I don't have either the inclination or the stamina to trade punches on these kinds of topics any more. And I have higher priorities than trying to build any kind of street cred here, or my post count. After all, people will believe whatever they want to. Perhaps I'm simply getting too jaded, and too long in the tooth for it all. LOL.

David
  • #187
  • Nov 9, 2011 3:14am Nov 9, 2011 3:14am
Quoting hanover
Nubs, I wasn't sure whether you were officially a beagle or not. Honestly, I haven't probed too deeply into either your trading systems, or Bob's trading systems, hence if I was to say "XYZ is full of shit", it would at best be unsubstantiated guesswork.

I try not to throw the baby out with the bathwater. Just because a person has one great idea, doesn't necessarily mean that he's right about everything else. Conversely, just because I disagree with one post, doesn't mean that I automatically write its author off altogether. IMO more progress...
you are like an old grandpa swilling a whiskey on the sidelines and smoking a pipe. you are just so.... pleasant.

i think you don't give your instincts enough credit. one doesn't need to study bob's threads, for example, to glean enough perspective on what the deal is.

i know that you are cluey enough to know what's what. your OS choices might suck, but everyone has their faults

my pitchfork is engraved "down with false prophets". i have a spare you can borrow anytime you wanna jump into a dog-pile.
Congratulations ScalaFX for coming out of the closet!
  • #188
  • Nov 9, 2011 3:34am Nov 9, 2011 3:34am
Quoting AaronWard
David, .......

To be fair, I understand your definition of "edge" to be very specific and narrow. Good entry, good exit, nothing more. Use of stoploss and hedges are outside the parameter of both. Well you might argue for the exit issue...

Aaron
Aaron,

My definition of an 'edge' comes from my gaming background. The casino holds an edge over the Roulette punter due to the payoffs relative to the odds of certain numbers, colors, etc being spun. A blackjack pro gain gain an edge over the casino by card counting. These kinds of ideas relate to what I would broadly call 'gameplay', as opposed to MM (or anything else).

It's my view that MM (i.e. a staking system) can not in itself provide an edge. I posted a XLS that demonstrates this. However, any failure to apply prudent MM (example: a trader who overleverages himself, or increases his trade risk recklessly to recover recent losses) will likely result in ruin.

Similarly, it's my view that psychology (e.g. discipline; patience; the ability to overcome fear and greed) can not in itself provide an edge. Again, however, psychological foibles like ill-discipline, or allowing your trading decisions to be influenced inordinately by fear or greed, can potentially lead to ruin.

I remember reading in a thread discussing edges, that one poster said his edge was that "the market goes up and down". But of course that offers exactly the same potential benefits, and dangers, to everybody.

So...... what part of trading equates to 'gameplay'? I would say it's entries and exits; i.e. market analysis, and 'pure' trading strategy that capable of being measured in raw pips. I guess the lines between 'gameplay' and MM get blurred if the trading strategy calls for an increase in position size in certain situations. Nonetheless, I still remain convinced that one must be able to somehow time entries and exits so as to exploit proven, recurring vagaries in price movement, in order to be profitable. Whether rightly or wrongly, that is what I call an 'edge'. For if you lack this core ingredient, then all of the position sizing variations, discipline, positive thinking, etc etc in the world become worthless.

Just my 2c, FWIW.

David
  • #189
  • Nov 9, 2011 8:02pm Nov 9, 2011 8:02pm
Quoting hanover
Aaron,

My definition of an 'edge' comes from my gaming background. The casino holds an edge over the Roulette punter due to the payoffs relative to the odds of certain numbers, colors, etc being spun. A blackjack pro gain gain an edge over the casino by card counting. These kinds of ideas relate to what I would broadly call 'gameplay', as opposed to MM (or anything else).

It's my view that MM (i.e. a staking system) can not in itself provide an edge. I posted a XLS that demonstrates this. However, any failure to apply prudent MM (example:...
David,

Since we last spoke on this issue, I have thought of little else. What you have shared on this topic has saved me months and perhaps even years of effort. Many thanks.

How does fundamental analysis fit into your picture of the world? And your forex strategies?

Aaron
Kill the ego, or it will kill the mission.
  • #190
  • Nov 9, 2011 8:08pm Nov 9, 2011 8:08pm
Quoting AaronWard
David,

Since we last spoke on this issue, I have thought of little else. What you have shared on this topic has saved me months and perhaps even years of effort. Many thanks.

How does fundamental analysis fit into your picture of the world? And your forex strategies?

Aaron
i think it was you who suggested that psycho-nonsense was an edge, and i refuted this to no avail. if my memory is correct then it would seem you have finally come around on this matter at least.

no psycho trickery and mental masturbation will produce profits on shitty trading. being retarded will obviously hamper efforts, but being calm as a hindu cow won't give you profits either.
Congratulations ScalaFX for coming out of the closet!
  • #191
  • Nov 9, 2011 8:23pm Nov 9, 2011 8:23pm
Quoting nubcake
i think it was you who suggested that psycho-nonsense was an edge, and i refuted this to no avail. if my memory is correct then it would seem you have finally come around on this matter at least.

no psycho trickery and mental masturbation will produce profits on shitty trading. being retarded will obviously hamper efforts, but being calm as a hindu cow won't give you profits either.
Nubs,

The issue was the English language, not trading. David uses a very narrow definition. I was using a broader definition.
Kill the ego, or it will kill the mission.
  • #192
  • Nov 9, 2011 8:42pm Nov 9, 2011 8:42pm
Quoting AaronWard
Nubs,

The issue was the English language, not trading. David uses a very narrow definition. I was using a broader definition.
ok aaron. yes aaron.
Congratulations ScalaFX for coming out of the closet!
  • #193
  • Nov 9, 2011 9:48pm Nov 9, 2011 9:48pm
Quoting nubcake
ok aaron. yes aaron.
Glad you agree with me. You see, the statement "Psychology provides a trading edge" can be either true or false depending upon your definition of "edge".

Now both David and I nicely sidestepped that issue by providing our definition of edge along with our arguments. We also provided our rational for our definition of edge.

But what I took from my discussion from David was very valuable. It was to worry second about changing myself and worry first about how to make better entries and exits.
Kill the ego, or it will kill the mission.
  • #194
  • Nov 9, 2011 9:53pm Nov 9, 2011 9:53pm
hedging... theres profit hedging and loss hedging. if say u are losng 50 pips and wanna lock the loss there go buy it same lot, and ure P/l is locked. same with profit hedging, except i find profit hedging more fun and better for profit locking. say you sold silver at 40.00 and price now at 39.00, u hit the buy with same lot, and ur silver sell p/l is locked. aka ur sell will not lose potential profit u just made.

talk to kennyz about locking profit hes the pro, im still beginner in that, but its very powerful.

take care
Have I got something on my face, SOLDIER?
  • #195
  • Nov 9, 2011 10:00pm Nov 9, 2011 10:00pm
from now on i'm going to call cars popcorns. it's just a language issue, right? my broad definition of popcorn happens to include cars, and no one can tell me otherwise. anytime from this point onwards everyone should understand what i mean when i say popcorn (whether they read this post or not).

right? of course. yes aaron. ok aaron.

buma : such a shame you had to bring this up again, despite it been proven for years and years and within the last week in THIS VERY THREAD that what you just described is utter bollox. well done.
Congratulations ScalaFX for coming out of the closet!
  • #196
  • Edited 10:20pm Nov 9, 2011 10:10pm | Edited 10:20pm
Quoting nubcake
from now on i'm going to call cars popcorns. it's just a language issue, right? my broad definition of popcorn happens to include cars, and no one can tell me otherwise. anytime from this point onwards everyone should understand what i mean when i say popcorn (whether they read this post or not).

right? of course. yes aaron. ok aaron.

buma : such a shame you had to bring this up again, despite it been proven for years and years and within the last week in THIS VERY THREAD that what you just described is utter bollox. well done.
Nubs, As I said, it is a language issue. To call a car "popcorn" will not work within the context of English unless you were to provide a very specialized definition.

Both David's and my use of edge work within the existing context of the English language without providing a specialized definition. This is precisely why we both took the trouble to define our terms.
Kill the ego, or it will kill the mission.
  • #197
  • Nov 9, 2011 10:11pm Nov 9, 2011 10:11pm
Quoting nubcake
from now on i'm going to call cars popcorns. it's just a language issue, right? my broad definition of popcorn happens to include cars, and no one can tell me otherwise. anytime from this point onwards everyone should understand what i mean when i say popcorn (whether they read this post or not).

right? of course. yes aaron. ok aaron.

buma : such a shame you had to bring this up again, despite it been proven for years and years and within the last week in THIS VERY THREAD that what you just described is utter bollox. well done.

i am confused... really i dont know what u said
Have I got something on my face, SOLDIER?
  • #198
  • Nov 9, 2011 10:48pm Nov 9, 2011 10:48pm
Quoting AaronWard
Nubs, As I said, it is a language issue. To call a car "popcorn" will not work within the context of English unless you were to provide a very specialized definition.

Both David's and my use of edge work within the existing context of the English language without providing a specialized definition. This is precisely why we both took the trouble to define our terms.
but i say so! a car will now be referred to as popcorn. that's MY definition within my broad understanding of language use. how can you tell me that my definition is wrong?

if we take your reasoning that particular words have particular meaning then we have come full-circle back to my original post which if i remember correctly begged that we don't start diluting the term 'edge' by incorporating such ethereal bullshit as psycho-bation. an edge has a defined meaning, and your argument back then was that in YOUR view of edge it includes the mental game, whereas my point was that this is not correct and an edge has a very finite definition which does not include such things as such things do not provide an edge.

so, are cars popcorn or not? you can't have it both ways
Congratulations ScalaFX for coming out of the closet!
  • #199
  • Nov 9, 2011 11:12pm Nov 9, 2011 11:12pm
Quoting nubcake
but i say so! a car will now be referred to as popcorn. that's MY definition within my broad understanding of language use. how can you tell me that my definition is wrong?

if we take your reasoning that particular words have particular meaning then we have come full-circle back to my original post which if i remember correctly begged that we don't start diluting the term 'edge' by incorporating such ethereal bullshit as psycho-bation. an edge has a defined meaning, and your argument back then was that in YOUR view of edge it includes the...
Perhaps you could provide your definition of an edge then...
Kill the ego, or it will kill the mission.
  • #200
  • Nov 9, 2011 11:27pm Nov 9, 2011 11:27pm
Quoting AaronWard
Perhaps you could provide your definition of an edge then...
why is this so very very difficult for you to grasp? the definition of an edge is something you can identify which skews the odds towards a more favorable outcome which has nothing to do with your personal situation and everything to do with the mechanics of the situation.

it's not hard, aaron. it really isn't!

how much edge does nedging provide? none. it's not an edge. the markets will still do whatever it is they are going to do.

how much of an edge does feeling good about oneself while trading give? none. it's not an edge and the market will still do whatever it is going to do.

how much of an edge does only trading when not drunk or sick provide? none. it's not an edge and the market will still do whatever it is going to do.

how much of an edge does standing on one leg provide? none. it's not an edge and the market will still do whatever it is going to do.

how much of an edge does objectively identifying days where the market is likely not going to move or is likely to move provide? well, that depends on how well you can exploit this probable situation.

how much of an edge does wearing your lucky underwear provide when playing blackjack? none. the cards will still deal the same way.

how much of an edge does counting cards provide when playing against friends with a one or 2 deck shoot? take a guess and make some money off of them.

how much of an edge does knowing that a roulette wheel has a massive bias towards a certain number provide? always bet on black, no red, no red and black and hedge your bets!!!

un-handicapping oneself does not provide an edge if the mechanics of the situation are still in favor of you losing overall. being the calmest, most emotionally stable person on earth will not provide an edge. eating healthy will not provide an edge. the market will still do whatever it is going to do despite whatever YOU do.
Congratulations ScalaFX for coming out of the closet!
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