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Well my initial pass of the trading
books/people/seminars/advice/websites/newsletters/my losses all
indicate your point: that one's system may be simply flipping a coin
to pick stocks but it will work with good money management.
Conversely, the world's best system is likly to fail without good
money management (and a bad system will always fail even with mm).
I'm practicing Elder's method (complicated a bit thru the use of
options for leverage), but there's got to be more... So, where's the
thread on money management?
--- In equismetastock@xxxxxxxxxxxxxxx, superfragalist <no_reply@xxxx>
wrote:
>
>
> Well, I guess we're going to share different opinions on this issue
> tonight. Trading IS made unnecessarily complicated--that's true.
> Unfortunately that is often due to the lack of education on the
> subject.
>
> Learning to trade is a journey from the excitment of thinking
you're
> going to make a lot of money, to trying to find the grail, to
> reinventing every wheel, to realizing that all you're going to find
> is something that works some of the time, to creating your own
system
> and then becoming confident in the fact that you know it works for
> you. You can't do that sitting in a room in front a computer screen
> playing hit and miss video poker all day, and then watching
> television the rest of the night.
>
> Too many people get into this, and then won't bother to learn
> anything about anything. They want plug-in play trading. They ask a
> few humdrum questions on here about how to program some magical
setup
> or indicator that they heard was the one that was going to make
them
> bundles of cash. Oh well.
>
> What the book failed to point out is that all the top traders read
> and study everything written by other top traders, and they talk to
> each other. They don't ask each other dumb-butt questions like
what's
> the one BEST book I should read---that's the first question out of
> the mouth of someone who isn't going to succeed.
>
> Discipline starts with an education. If you don't have the
discipline
> to study the business of trading--the whole business, not some
guru's
> seminar--then you don't have the discipline to stick to a system. A
> system is a range of things, including position sizing and money
> management, which is the least discussed topic on this website.
Those
> two things are far more important than what indicators you use. How
> many people on here know what optimal f is, how to calculate it,
have
> a program to calculate it, know the drawbacks to using optimal f or
> how to overcome them? Everyone tries to optimize their indicators
but
> how many people on here know that money management techniques can
be
> tested just like indicators and that certain types of money
> management strategies can impact trading profits from identical
> systems by as much as ten times.
>
> There are many, many ways to approach trading, and until you learn
> what they are about and find the system that is right for you, you
> aren't going anywhere but off to find a new hobby.
>
> KISS isn't a synonym for ignorant. Simplicity comes from expertise.
> Great musicians make playing look easy. Great traders make trading
> look easy. That simplistic ease they approach their craft with is
not
> backed by a lack of knowledge.
>
> Basically you formulated your opinion while you were reading a
> trading book? I hope that book didn't convince you to stop reading
> other books!
>
> And I do agree with Andrew that Van Tharp is not a guru of
anything,
> but it's a good place to start because he handles a lot of general
> myths right out of the box. Don't pick a guru like Elder and think
he
> has all the answers, or that because his system works for him, it's
> going to work for you. Read all the gurus, blend it together,
> customzie to fit and then apply the system. After you have your
> system, keep reading--not because there is something better and you
> have to find it, but to keep your brain alive and thinking.
>
>
>
>
>
>
>
>
>
>
>
> --- In equismetastock@xxxxxxxxxxxxxxx, Pam and Ken Johnston
> <milocat@xxxx> wrote:
> >
> > I hate to contradict Superfragalist because its obvious from his
> posts that
> > he knows that about which he speaks but I have to offer a
> completely
> > different opinion. Trading is made unnecessarily complicated by
> most
> > people. I remember reading a book about top traders and one of
the
> > interviewees made a refreshingly different observation about
> trading,
> > essentially he said that the good news was that finding a good
> method to
> > trade that produced excellent results over time wasn't very
> difficult. The
> > bad news was that having the discipline to stick to any given
> method was way
> > beyond most people.
> > I would forget about 100 different books and psychological
> consultants.
> > Find a simple method that makes sense to you(otherwise you will
> abandon it)
> > and resolve to stick with it. Astrocycles-time extraction-fibo
> squares etc
> > are likely no better than moving averages-the tough part is
picking
> a method
> > and staying the course.
> > I doubt that there is any facet of human existence where the KISS
> principle
> > is more applicable than trading.
> > ----- Original Message -----
> > From: "superfragalist" <no_reply@xxxxxxxxxxxxxxx>
> > To: <equismetastock@xxxxxxxxxxxxxxx>
> > Sent: Monday, January 10, 2005 9:44 AM
> > Subject: Re: [EquisMetaStock Group] Should I follow indicators?
> >
> >
> > >
> > >
> > >
> > > Yeah, I have a suggestion. You should read somewhere around a
100
> > > trading and systems development books, and then if you plow
> another
> > > few thousand hours into understanding what you've read,
> experimenting
> > > and figuring out how to trade with what you've come up with,
then
> > > you'll be close, really close.
> > >
> > > There's nothing anyone on here is going to post that will help
you
> > > more than the above mentioned paragraph.
> > >
> > > If there was one good indicator--or trading method--we'd all be
> using
> > > it. We ain't. Indicators fit people and personalities. It's all
in
> > > what you can use, and no one on here, or anywhere else, can
define
> > > that for you.
> > >
> > > Go to amazon buy every book they have on trading and sytems
> > > development and you'll be off to a relatively mild start, but
> > > generally in the right direction.
> > >
> > > Read Van Tharp's Trade Your Way to Financial Freedom first.
That
> will
> > > get rid of a lot of your misconceptions like entries are
> important.
> > > Read the other 100 books next, and then read Van Tharp's again.
By
> > > that time you might have a prayer of getting it.
> > >
> > > If you want easy--go bowling!
> > >
> > > Sorry, but them's the realities.
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > > Yahoo! Groups Links
> > >
> > >
> > >
> > >
> > >
> > >
> > >
> > >
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