[Date Prev][Date Next][Thread Prev][Thread Next][Date Index][Thread Index]

Re: Money Management Stops



PureBytes Links

Trading Reference Links

This is not correct.  Each spin is unrelated to all previous spins.  Each
spin has a 50% chance (excluding greens) of being black.  If you have 30
cases where you have 6 consecutive blacks, the 7th spin will be black 15
times and red 15 times.  There is NO correlation to prior spins.  NONE.
ZIP.  NADA.

Kent


-----Original Message-----
From: Jeffrey Huck <jhuck@xxxxxxxxxxxx>
To: metastock@xxxxxxxxxxxxx <metastock@xxxxxxxxxxxxx>
Date: Thursday, April 13, 2000 7:49 PM
Subject: Re: Money Management Stops


The math on this is WAY off.  If you claim your system has a 70% probability
of success, then it is 70% for each trade, exclusive of anything else you
have done in the past.  How does the market, or the roulette wheel for that
matter, know how you did last trade, or last spin?

Here's another angle.  Before each trade, there is a 70% chance that the
trade will end up successful.  After the trade, it was either 100%
successful, or 0% successful.  Over time it is the cumulative average of all
these 100%'s and 0%'s that give you the 70%.

Back to roulette:  Before each spin there is a 50% chance that it will land
on red or black (green's being excluded).  After each spin, the spin was
either 100% black, or 100% red.  Given 2 possible outcomes, over time each
outcome will approace 50% probability.  If you have 3 blacks in a row, the
odds of the next spin being red or black are still 50/50.

Your system for trading, and gambling, may indeed make you money, but not
for the reason's you've sighted.

Jeff

----- Original Message -----
From: "Michel Amelinckx" <Michel.Amelinckx@xxxxxxxxxx>
To: <metastock@xxxxxxxxxxxxx>
Sent: Thursday, April 13, 2000 12:10 PM
Subject: RE: Money Management Stops


> Sorry but I by this "every time you have a losing trade the odds of your
> next
> trade goes up" I meant the PROBABILITY of next trade goes up. You always
> have 50% odds.
>
> > If the success rate is 70%, it's true that there is about a
> > 99% chance of
> > having 4 losing trades in a row.  However, once you've
> > already had 3 losing
> > trades, the chance of the next trade being a success is still
> > only 70%.
>
> No I don't agree, a system 70% prof. and having 3 consecutive losing
> trades - the probability that the next trade will be a successful is 99%.
> If you have a system that is 55% correct of the time. If you wait for 4
> consecutive losers you have almost an 95% probability that the next trade
> will be successful.
>
> Same thing with roulette, they hate me in the casinos because if I play
> roulette I play on red and black.  I wait till red (black)past 3 or 4
times
> in a row and then play on the other colour. And the longer you wait, like
5
> or 6 times on red (black) the higher the probability the next will be the
> other colour. Although 6 times the same colour is very rare. And this they
> don't like in casinos.
>
> Greetings
>
> Mickey
>
>
> > -----Original Message-----
> > From: owner-metastock@xxxxxxxxxxxxx
> > [mailto:owner-metastock@xxxxxxxxxxxxx]On Behalf Of Randy Harmelink
> > Sent: donderdag 13 april 2000 17:24
> > To: metastock@xxxxxxxxxxxxx
> > Subject: Re: Money Management Stops
> >
> >
> > You can't use statistics that way.  An increase in
> > probability only occurs
> > if the events are dependent.
> >
> > For example, suppose you are trying to draw an ace of spades
> > from a deck of
> > cards.  If you continue to draw and discard cards that aren't
> > the ace of
> > spaces, your probability of drawing the ace of spades
> > increases on each
> > draw.  But if you put each drawn card back into the deck and
> > reshuffle, your
> > probability of drawing the ace of spades on a given draw will
> > never change,
> > no matter how many times you fail to draw it.
> >
> > If the success rate is 70%, it's true that there is about a
> > 99% chance of
> > having 4 losing trades in a row.  However, once you've
> > already had 3 losing
> > trades, the chance of the next trade being a success is still
> > only 70%.
> >
> > Otherwise, it would be easy to develop a system to beat a
> > roulette wheel.
> > <G>
> >
> > ----- Original Message -----
> > From: Michel Amelinckx <Michel.Amelinckx@xxxxxxxxxx>
> > To: <metastock@xxxxxxxxxxxxx>
> > Sent: Thursday, April 13, 2000 7:58 AM
> > Subject: RE: Money Management Stops
> >
> >
> > > And because you have such a great number of profitability,
> > did you know
> > that
> > > every time you have a losing trade the odds of your next
> > trade goes up.
> > > 70% prof - after 2 consec losing trades - probability next
> > trade will be a
> > > winner is 91%
> > > 70% prof - after 3 consec losing trades - probability next
> > trade will be a
> > > winner is 97%
> > > 70% prof - after 4 consec losing trades - probability next
> > trade will be a
> > > winner is 99%
> >
> >
> >
>
>