do traders subconsciously really want to lose?

[anuragmunjal]

There is no right or wrong notion here.

It is only percentage play. 70% loosing trades Vs 30% winning trades. Once can go on arguing about which is better and why. There is an old saying "a bird in hand is better than two in the bush"

Many are giving away the one in their hand hoping that someday they will get the two in that bush or even hopping that there are far more than the two there and he shall get them.

That is another matter.

The point is what controls and drives the brain in this activity named share trading.

Many talk about risk capacity. Formula one driver may be taking far more risk than an average trader. Or a ski diver. Can they be good share traders because their brain is tinned to take risk?

what controls and drives the brain.. comfort.. hence the emphasis on more winners and satisfaction with a 'bird in hand'.
generally, there is an emphasis on trading ' in the zone', within ones 'comfort levels'.
the emphasis remains on great defence. nothing wrong with it..
I, on the other hand like to take the attack to the opponents, get out of my comfort zone. this definitly makes the results more volatile but does not imply that it is more risky.

regards

 

[agsuresh]

Unfortunately that statement is ambiguous and confusing, it's even looking contradictory.

Let me add some context and see if the confusion goes away.

Training in newbie's context is his effort to tinker with TA, FA, indicators, systems, attending seminars, search for holygrail system (i.e one that only makes profit or consistent profit like a salary)watching news channels, reading newspapers, elaborate theorizing etc etc.

Intuition in newbie's context is some magical 6th sense like precognition of disasters (in movie: final destination)

luck in newbie's context is a special power like video game avatar having special powers (like flying, emitting fire etc.), in an uncertain land only luck can help him to escape from his 'game over'. If luck is on your side, one can effortlessly move to next level of the game. If no luck, he can die by a sudden dragon jumping on him from nowhere, no matter how much mastery he has in playing video games.

I am rejecting all the above ideas as partial and incorrect views of reality.

If you see 'How a person can lose 70% time and win 30% but still can't go broke, still worse such traders become top 1-5% of winners??' as contradictory statement.

To remove the contradiction inside your head you need new concepts and fill the gap.

For eg. when a cave man hears about a mobile phone or GPS navigation or air craft, he will feel, this is all nonsense and contradictory, he may ask "how a piece of metal can take off and fly like a bird when no metal I have seen has done that...", all you can say is dude, you need more concepts to understand, its not magic.

Similarly the concepts you are missing are: Position Sizing, Money management and risk management.

Don't ask me to explain them all here... unless you are ready to pay me hourly consulting charge , go do your home work! (BTW TJ is great place and many threads explain these things and senior expert traders are generous enough to spend their time to help newbies, browse other threads to know more).

//Similarly the concepts you are missing are: Position Sizing, Money management and risk management.//

You know, you make this as if it your your holy grail. All of that you mentioned is part of that training process, whether it is newbee or oldbee and any new concepts of economic and finances.

By the way what made you think I am seeking tutions from you ?

Whatever concepts you may bring to the table and make claims, they shall remain only claims unless & until people are able to make money using them and that is where all those concepts fail.

This is exactly what people use to say, 5 years or 10 years or 15 years back with the advent of every new concept and technical indicators devised. They still do and we find new indicators that claim to be new holly grail. But are they.

All those so called experts at one point of time where newbees. and at that time their only concern was to make money pots and pots of it and never loose the capital. They should survive the initial stages to be the oldbees and learn all that management. After all there should be enough to manage!

One can go on talking theories or make money talking theories. That is easy because it is someone else money. The problem starts when one puts his own money and bets on his own theories.


Here is an interesting naked truth

http://timesofindia.indiatimes.com/...with-a-pinch-of-salt/articleshow/44457498.cms

I do not think the discussion was about newbee theory or oldbee theory on financial management, But on the action of the brain that causes failures or success in that nano second period in which he takes the decision. To identify why brain acts in the way it does and to be able to train it to be more systematic or to be in perfect control.

 

[onlinegtrash]

//Similarly the concepts you are missing are: Position Sizing, Money management and risk management.//

You know, you make this as if it your your holy grail. All of that you mentioned is part of that training process, whether it is newbee or oldbee and any new concepts of economic and finances.

By the way what made you think I am seeking tutions from you ?

Yes, sir, I made all the wrong assumptions and said all the wrong things
Feel free to correct me if you find something incorrect and dumb in my posts!

 

[Galts Gulch]

Yes, sir, I made all the wrong assumptions and said all the wrong things
Feel free to correct me if you find something incorrect and dumb in my posts!

This is WHY MK Gandhi's 3 monkeys are important ....

 

[nifty trade]

Sir,

Are you not contradicting yourself?

//So the magic is not in 'training, intuition or luck or god's gift'...//


The preparedness is what is involved in training. Is it not?

If the professionals loose 70% of trades and win only 30%, how can that be sensible ? That means one has 70% chance of wiping out his capital. and once his capital is gone what is the use of that 30% chance ? That makes this pure gambling. You are just hopping that you shall "one day" in your life time that you shall be in that 30% category and win all that you had lost being in that 70% category. Or even if you where in that 30% now that every chance that you shall be in that 70% category the next moment.

It is this uncertainty that brings in the element of Luck.

Unless the so called professionals are really good in what they do and the percentages are reversed. Then only the training, preparedness, knowledge, etc etc make sense.

There are lots of books and theories available on this subject. If one is good orator / have good writing skills , he can be publish books, but it needs far more than that to be in the driving seat and win.

Some persons just do not have in them to make it in the share market (widely known to be govt approved gambling unit). May be their brain is not tuned to function in a sensible manner at the most needed nano second. They fail but comforts themselves that even professional fail 70% so he will have to try more to reach there, continues and ultimately loose all the capital.

Some persons has that addiction to gambling that draws them to various gambling places. Whatever one tells them or however much they loose, they will borrow and get into that act. whether it is intense hope or pure addiction (it does not matter whether they loose or win), is difficult to understand.

Some persons bet on their gods not to let them down, some on their own intelligence and knowledge , some on astrologers etc etc.

This is a practical psychology.

The more the market is driven by emotions and manipulations, the more its becomes gambling. This is the state of Indian share market unlike the western markets where the investment is made more on fundamental quality of the companies and their potential. In India we can see many companies that have not made any sales or profit for years trading at very high rate for some time and vanish into oblivion. Some body made a fool of somebody. Some of these manuares could be avoided.

In my opinion there is a some factor of the human brain that enables the individual to trade effectively. If that factor is not favorable, he should better avoid this activity before he looses all his capital and bet on the 30% or less chance of making it.

This becomes sensible only of we can identify that particular aspect of brain and train oneself to take effective control to behave properly in that nano second time frame.

Casino have 4% edge over players and they win net net all years, year after year after year year after year

Is it luck? Or mathematics?