|
PureBytes Links
Trading Reference Links
|
What about "Reminiscences of a Stock Operator"?
----- Original Message -----
From: "Gerald Marisch" <gm@xxxxxxxxxxxxx>
To: "Timothy Morge" <tmorge@xxxxxxxxxxxxxxx>; "Jerry Gress"
<thegress@xxxxxxxxxxxxx>
Cc: "Omega List" <omega-list@xxxxxxxxxx>
Sent: Wednesday, July 12, 2000 11:00 AM
Subject: Re: Real Life Stories
> Want "real life" stories?
>
> Read "Market Wizards" and "The New Gatsbys".
>
> The former is about "real life" pit trading "big boys" and the latter is a
> collection of experiences. Maybe a little embellishment here and there,
but
> both are good, enjoyable reads...
>
> And you just may pick up one or two trading "golden nuggets" here or
> there........
>
> ----- Original Message -----
> From: "Timothy Morge" <tmorge@xxxxxxxxxxxxxxx>
> To: "Jerry Gress" <thegress@xxxxxxxxxxxxx>
> Cc: "Omega List" <omega-list@xxxxxxxxxx>
> Sent: Wednesday, July 12, 2000 10:20 AM
> Subject: Re: Real Life Stories
>
>
> > Jerry:
> >
> > My response may not be what you are looking for, but here goes:
> >
> > I had been trading for about 18 years when I finally decided to go on
the
> floor
> > of the CME. My wife actually suggested it, because she kept hearing me
> talk
> > about how the pits are slowing disappearing. Her thought: I'd been
trading
> on
> > the phone with the CME and CBOT all these years. Would I feel like I
> missed
> > something if I hadn't spent some time trading in the pits?
> >
> > Once I began the registration process for getting a CME seat, I spent
the
> next
> > six weeks or so with a visitor pass to the pits and I tried to spend the
> whole
> > trading day in the pits. For me, there was so much noise and action
going
> on
> > that I needed to acclimate myself to the pit environment. By the time my
> seat
> > came through, it was clear that the pits were a very different place to
> trade,
> > relative to my past trading environments. It was extremely easy to be
> 'swayed'
> > into positions by the noise and enthusiasm of the pits.
> >
> > To solve this issue for me, each morning at breakfast at the Merc club
> [CME
> > members restaurant], I put down a game plan for the trading day in the
> various
> > commodities I planned to trade that day. The most important thing I
> learned was
> > that to trade in the pits without a plan was much worse than trading in
> the pits
> > with a *bad* plan. Pick a plan of action for the day and then do your
best
> to
> > execute it. I would print out swing charts and then run my retracements
> and
> > projections, support and resistance. Then I'd put these levels into a
> table that
> > was easy to read and I marked the important levels in red with a
> highlighting
> > marker. On the top of that table, I printed very clearly the two or
three
> things
> > I planned to accomplish that trading session in that commodity--so I
might
> have
> > written down that in my swing trade analysis, I would be looking for a
> place to
> > sell. And once I got short, I would be looking for XX as support and YY
as
> my
> > stop-loss level.
> >
> > Of course, there were mornings when the plan was useless in the first
> fifteen
> > minutes of trading--a large gap opening, for example, or a surprise in
an
> > economic number released at 7:30. In that case, I left the pits and went
> back to
> > the office of my clearing firm and ran new charts and made new tables
and
> > developed a new plan. I *did not* walk right behind the pits and use the
> readily
> > available CQG and FutureSource machines for a quick look and feel--I
found
> > quickly that that was like taking sugar or a drug that spurred me to
trade
> with
> > poor analysis. To get to my clearing firm's office, I had to go down the
> > escalator and then up the elevators. I found that the ten or fifteen
> minute
> > action of leaving the floor and getting into an office cleared my mind
and
> > allowed me to re-think the markets.
> >
> > What did I look at when I was literally in the pits? You don't have to
> look at
> > the boards for prices. Everyone standing around is shouting and using
hand
> > signals. If you are trying to read prices off of the board, it usually
> means you
> > are disoriented. About the only time I would use the price boards was
when
> I was
> > trading something that was being driven by a different commodity. For
> example,
> > if I was in the Dmark pit and the DM was rallying based on a really
strong
> yen,
> > I would keep my eyes on the yen prices on the board. At that time, the
yen
> pit
> > was not particularly close to the DM pit [several pits away] but you
could
> > always hear when the yen made a new high or low--the noise is
unmistakable
> in a
> > running market.
> >
> > Other than looking at news releases as they are flashed up on the
boards,
> I
> > didn't find much use for them. I did not watch the Qcha in the S&Ps, for
> > example; but then, I was never a scalper.
> >
> > I had a great time in the CME pits. It isn't for everyone--in fact,
after
> six
> > months or so, I found that I was walking into the pits and then
executing;
> then
> > I leave the pits until prices got near my stop or profit levels. That's
> pretty
> > much what I do all day in my trading office, so I got rid of my seat.
> Trading
> > for six hours in the CME pits takes an incredible amount of stamina and
> energy.
> > I think most people think the locals stand around at a party, waiting to
> steal
> > money from you when you place an order. It's really hard work. If you
get
> the
> > chance to go on the floors of the exchanges, go! There's no experience
> like pit
> > trading.
> >
> > Best,
> >
> > Tim Morge
> >
> > Jerry Gress wrote:
> >
> > > Hi Tim,
> > >
> > > I always like reading the stories of the pits.
> > >
> > > When you were in the pits what was the number one board display did
you
> look
> > > at?? Besides the 'noise' , hand signals, runners, shouting of the big
> > > players, what did you look at that off floor traders can have access
to?
> > >
> > > Regards,
> > >
> > > Jerry Gress
> > > Stockton, Calif. USA
> > > trader@xxxxxxxxxxxxx
> > >
> > > ----- Original Message -----
> > > From: "Timothy Morge" <tmorge@xxxxxxxxxxxxxxx>
> > > To: "Ron" <ron560@xxxxxxxxxxx>
> > > Cc: "Omega List" <omega-list@xxxxxxxxxx>
> > > Sent: Tuesday, July 11, 2000 10:27 AM
> > > Subject: Re: DATA Discrepency BE AFRAID!!!
> > >
> > > > Ron:
> > > >
> > > > If have ever visited the futures exchanges--or better yet--pit
traded
> for
> > > a
> > > > period of time, you'd see that the prices we get from data vendors
> [and
> > > the data
> > > > the exchanges send out] are only fairly crude representations of
where
> the
> > > > market is. Remember, except for the totally electronic exchanges, we
> are
> > > seeing
> > > > prices that are derived from a group of clerks standing outside the
> pit,
> > > typing
> > > > away as fast or slow as they wish. Often, I'll do an order in a pit
> like
> > > the
> > > > Nasdaq futures [where I have direct phones to the pit] and after I
> make
> > > the
> > > > trade and confirm the trade and price is moving away from where I
made
> the
> > > > trade, my broker will be shouting at a pit 'recorder' to get the
price
> on
> > > the
> > > > *blanking* screen.
> > > >
> > > > I had a seat on the CME for a stretch of time. Trading in the
currency
> and
> > > S&P
> > > > pits for any period of time there will give you a better feel for
the
> > > 'noise'
> > > > contained in the data most of us use. You clean it the best you can
> and
> > > trust
> > > > techniques you use that are successful over time. Data streams from
> > > different
> > > > sources may not match--especially if they are using different data
> plants.
> > > >
> > > > What do you do in this case? You'll have to watch both data streams
> with
> > > your
> > > > indicator and then choose which you trust and which is successful.
> This
> > > may be
> > > > the lesson that shows you just how subjective most indicators are.
> > > >
> > > > Be careful out there! This is real money!
> > > >
> > > > Best,
> > > >
> > > > Tim Morge
> > > >
> > > > Ron wrote:
> > > >
> > > > > Please consider the following example:
> > > > >
> > > > > DTN Feed_IBM 60min_Stochastic Crossover
> > > > > A crossover buy is generated using DTN data.
> > > > >
> > > > > Quote.com Feed_IBM 60min_Stochastic No Crossover
> > > > > No crossover in Quote.com data using same stochastic parameters.
> > > > >
> > > > > What do you do? Both feeds have been working fine all day and tick
> > > counts
> > > > > are within 95% of each other but obviously there is a discrepancy
in
> the
> > > > > data between the two feds. Its very hard to get to independent
feed
> to
> > > match
> > > > > data exactly, especially on the lower time frames.
> > > > >
> > > > > Since no two feed are the same does it make sence to test systems
on
> one
> > > > > data source and trade it using another. No matter how reliable
your
> data
> > > > > source is for historical data there is no guarantee that your real
> time
> > > data
> > > > > matches the intrinsic characteristics of your historical data
> source.
> > > Infact
> > > > > most often the performances will NOT be the same for the same
> system.
> > > This
> > > > > highly limits the type of systems that can be traded in real-time
> and
> > > tested
> > > > > historically. SO BE AFRAID!!!
> > > > >
> > > > > This data problem has been bugging me for a long time and unless
you
> > > have
> > > > > direct feeds from exchanges and full control over the data
> distribution
> > > and
> > > > > filtering process you may be trading based on artificially
adjusted
> > > data.
> > > > >
> > > > > So where do you draw the line.
> > > > >
> > > > > All comments appreciated. Thanks
> > > >
> > > >
> >
> >
>
|