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Stan and Kaye,
I like everything below except the paper-trading
comment.. Here's my personal opinion in paper-trading,
your mileage may vary..
If you can't make (fake) profits in a paper-trading
or back test exercise, you will definitely not
succeed with real money.
I agree that most back testing is suspect/hogwash when
used to sell trading systems. And I agree that
paper trading is not the same as real trading. But
I've been able to save a lot of money by proving
during paper trading that some concepts will not
work in real trading.
Paper trading allows me to test a higher volume of
trades, on a more diverse collection of trading concepts
during a shorter time-span, than real trading does.
It accelerates the learning process, and reduces risk.
One of the priorities of a new trader is to make
his/her trading capital last through the learning
process. Testing trading ideas in the real market
can blow your capital quickly, so paper-trading
can help with this by eliminating bad concepts
before you test the better ones in the markets.
But a concept which is validated by paper-trading
may not work in the real world, no escaping that.
Do your homework, paper trading is one way to do so.
All of the successful techniques I use were tested
on paper first.
Here is another good book: The Disciplined Trader,
by Mark Douglas.
I've typed up several pages of good advice (basic
truths about trading) for beginners, that have received
good comments from beginner and experienced traders.
Send me email if you want them, or search the archives
of the RealTraders email list for prior messages.
They convey some important basics which I learned the
hard way.
-Neal.
At 01:21 PM 5/29/98 -0400, you wrote:
>I recommend the following books about trading (as opposed to technical
>analysis): "Computer Analysis of the Futures Market" by LeBeau and Lucas;
>"Street Smarts" by Connors & Raschke; "Trading for a Living" by Elder. If
>you want to learn about Technical Analysis, try "Technical Analysis of the
>Futures Markets" by Murphy. Avoid other peoples' systems; don't try paper
>trading; and concentrate fully on how much you have at risk (and limit
>yourself to a specific dollar risk in every trade) instead of concentrating
>on how much you can win.
>
>
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