Anticipatory v/s Reactionary Trading

[trader111]

Thanks Kgsirasangi, that u took time to read that post and glad that u asked that.

See rules always ought to be there... whether the trading is on hunches or whatever.... but what rules? it's coneptually the risk/reward. A trade may be initiated on a hunch only if this ratio seems worthwhile. Now if a position reaches the tolerable risk level by showing loss, it ought to be closed immediately.

Yes I trade on hunches, but thats seldom, and none of the three consecutive trades posted were initiated on a hunch.

I mentioned in my first few posts:

Another good example of the above two: all trend following systems are reactionary while all trend exhaustion based systems are anticipatory.
One of my favorite intraday trades: anticipating the last leg of a parabolic move, i consider as anticipatory.

Also, some people consider counterintuitive trading as anticipatory.

IMHO anticipatory trading does not includes hunches alone.

Actually I want to add more but let us move gradually, without jumping into conclusions.

Again i refrain from making concluding remarks, because discussion (almost)always helps. As students of the market, 'See Ma! I am right' approach is worthless'

 

[kgsirasangi]

trader111,

Thank you for sharing your ideas and experiences.
I note that you are usually in profit as you usually follow rules.
In my case also, whenever I follow rules, I get profits and whenever I trade as per anticipation(i.e. trying to catch top or bottom, or going against major trend, etc) I usually end up in losses( market usually proves me wrong in such cases).
This reinforces my faith that we should follow rules--safe rules---trade in the direction of major trend, use stop loss, use risk control as per money management etc.

Thanks and regards.

 

[trader111]

I mention again, I'd like to emphasize this several times that one does not loose money because of anticipating or hunches or any other psycho thing. It is only because of lack of knowledge.

There is nothing like trading against the trend, however trading on trend exhaustion makes much sense.

Those who are'nt well equipped will loose anyways. A wrong frame of mind can only interfere with a knowledgeable person For eg. you argue with your wife at 6 am and sit on your trading terminal after 3 hrs. of nagging. Yes, in this case the psychology issue will be important.

 

[sudoku1]

ALWAYS TRADE ON THE WINDS OF CONFIRMATION .....,RATHER THAN IN ANTICIPATION & GET DROWNED IN DEEP WATERS....

 

[raosrinivas]

you argue with your wife at 6 am and sit on your trading terminal after 3 hrs. of nagging. Yes, in this case the psychology issue will be important.

unmarried people have an edge in trading

 

[sudoku1]

unmarried people have an edge in trading

rao happy.....
shows that u r not married yet....

 

[SGM]

PS: the views expressed in the quoted text belong to the original author, not me

we hold you accountable by virtue of quoting him

 

[trader111]

OK hold me accountable for highlighting the perception of the best known authors in finance literature

BTW just noted that u r from Pune. I have quite some friends there... visited Bhimashanker- the Jyotirlinga.... no wonder u list Nature as among one of ur interests.

 

[uasish]

trader111,

Why dont you continue this thread,i have personally mis understood becoz of my lack of knowledge.

Asish

 

[CreditViolet]

Thats the problem with everyone, they want absolutes - either this or that. Very Communist.