I initially thought of accepting what you posted as it is without further engaging into discussion, but then I thought many members of this forum will get misled by doing so, hence my reply. Might be a long one though.
I just want to point out on one thing first and which is pretty obvious nowadays and that’s many trading experts sharing their mechanical system publicly in a workshop for a fee. And thanks to the social media, many workshop attendees write positive about the outcomes.
Now based on above what can be seen is that soon we will have many rule based mechanical traders, compounding their capital in no time right? Only step number 3 will hold a trader back from making money as the other steps are pretty easy and simple, isn’t it? So now anyone can quit job get couple of lakhs capital and make it 5x in a year. Am I missing anything here?
Second obvious point is, there are many computer geeks, maths geeks, stat geeks etc who can be hired by the big financial firms to build a mechanical system. Now it would be naive to think that it’s very difficult for the subject matter experts to find a system with an edge but a training and workshop guy finds it and sells it too! What’s the catch then? I am sure I don’t have to spell it out.
The only mechanical system that will work is when market stays the same - not just similar. The good part is that the market mostly will stay similar in years down the line. But it’s the discretionary traders experience which will give him an edge to use the specific rules under different market conditions.
If you notice I mentioned rules, but that’s not a mechanical system. I have switched to my original trading strategies from December 4th. And few posts back someone had asked if all the trades taken are of same system, to which I replied yes, just to keep things simple as I never intended to talk about trading system or anything as such. A bit elaborate answer is - different rules for different market conditions and trades based on those rules.
When I started as a full time trader in 2009 I was under the impression of some mechanical system will make me a fortune and that’s all I need, and had similar 7 points approach like you posted. When I shared my thoughts with a trader who was struggling to move beyond 3000 nifty futures (lot size was 50), he just said “it seems so easy for you, wish I can have similar thought process like you” . Of course he was just being kind to me ( I was then trading 200 nifty futures ) as I could have never imagined then what it takes to trade bigger size.
In the same year later I met a person through a good friend of mine, businessman and happened to be nifty trader! I was enthused to know he was a trader and I asked what timeframe he uses and does he do intraday. He did not share the same enthusiasm like mine and before answering anything he just asked “how many nifty do you trade?” I said 200. My answer caught his attention, and just maybe to be double sure he asked “lots?” I said no, 200 nifty futures quantity. He immediately ignored any further conversations related to markets and talked normal stuffs with my friend. While leaving I asked him how many he trades, he said 5000. I asked “lots” ? He laughed and said “I am not a big trader”
What I am trying to say is that, strategy is a very small part in compounding.
Market is ever changing and will keep changing, gain experience, learn from trades, build a mindset.
Now I am giving rest to my thumb
Sent from my iPhone using Tapatalk
I just want to point out on one thing first and which is pretty obvious nowadays and that’s many trading experts sharing their mechanical system publicly in a workshop for a fee. And thanks to the social media, many workshop attendees write positive about the outcomes.
Now based on above what can be seen is that soon we will have many rule based mechanical traders, compounding their capital in no time right? Only step number 3 will hold a trader back from making money as the other steps are pretty easy and simple, isn’t it? So now anyone can quit job get couple of lakhs capital and make it 5x in a year. Am I missing anything here?
Second obvious point is, there are many computer geeks, maths geeks, stat geeks etc who can be hired by the big financial firms to build a mechanical system. Now it would be naive to think that it’s very difficult for the subject matter experts to find a system with an edge but a training and workshop guy finds it and sells it too! What’s the catch then? I am sure I don’t have to spell it out.
The only mechanical system that will work is when market stays the same - not just similar. The good part is that the market mostly will stay similar in years down the line. But it’s the discretionary traders experience which will give him an edge to use the specific rules under different market conditions.
If you notice I mentioned rules, but that’s not a mechanical system. I have switched to my original trading strategies from December 4th. And few posts back someone had asked if all the trades taken are of same system, to which I replied yes, just to keep things simple as I never intended to talk about trading system or anything as such. A bit elaborate answer is - different rules for different market conditions and trades based on those rules.
When I started as a full time trader in 2009 I was under the impression of some mechanical system will make me a fortune and that’s all I need, and had similar 7 points approach like you posted. When I shared my thoughts with a trader who was struggling to move beyond 3000 nifty futures (lot size was 50), he just said “it seems so easy for you, wish I can have similar thought process like you” . Of course he was just being kind to me ( I was then trading 200 nifty futures ) as I could have never imagined then what it takes to trade bigger size.
In the same year later I met a person through a good friend of mine, businessman and happened to be nifty trader! I was enthused to know he was a trader and I asked what timeframe he uses and does he do intraday. He did not share the same enthusiasm like mine and before answering anything he just asked “how many nifty do you trade?” I said 200. My answer caught his attention, and just maybe to be double sure he asked “lots?” I said no, 200 nifty futures quantity. He immediately ignored any further conversations related to markets and talked normal stuffs with my friend. While leaving I asked him how many he trades, he said 5000. I asked “lots” ? He laughed and said “I am not a big trader”
What I am trying to say is that, strategy is a very small part in compounding.
Market is ever changing and will keep changing, gain experience, learn from trades, build a mindset.
Now I am giving rest to my thumb
Sent from my iPhone using Tapatalk
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