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Adrian,
See the imbecile's reply below
----- Original Message -----
From: "Adrian Pitt" <apitt@xxxxxxxxxxxxx>
To: <realtraders@xxxxxxxxxxxxxxx>
Sent: Thursday, July 04, 2002 7:53 AM
Subject: RE: [RT] What happened to the Hurst cycle?
> Norman,
>
> For someone of your experience I'm surprised you would say this...anyone
> who understands markets trading risk and possibilities knows your wrong.
>
> Can you tell me which studies show that short term trading lead to
> greater risk? I'd be interested to see how well based they are. I have
> little doubt though they are based on shaky foundations.
>
> You say each time you take a trade you take a risk...and yet you then go
> onto say that holding a position is less risky even though your actually
> in the market for longer? There is a contradiction here.
>
> Then you completely change the whole scenario. Who on this list has the
> capital 1/1000 the size of George Soros? You'd have to be an imbecile
> to suggest he could trade all his capital on short term moves....please
> tell me your not an imbecile Norman. Purely by his size he is FORCED to
> trade the bigger move.....wow..hardly earth shattering news there.
>
> This does NOT though invalidate the principle that small to medium sized
> players can't jump in and out in short term moves and in fact control
> their risk to an even greater extent by doing so. It has already been
> well established time and time again for example that small equity fund
> managers outperform large equity fund managers....once again..hardly
> earth shattering news.
>
> Yes...BIG money is made by riding BIG moves....that includes big money
> as in LARGE $$ amounts and also in relation to capital...but even larger
> amounts are made when you trade short term moves and compound those
> profits many times over in a year. A ST trader can make 100%+ regularly
> on his capital working full time in the markets....an investor
> cannot....not consistently. These are simple facts...based in reality
> and logic and maths...nothing complicated. Yes...it does create more
> brokerage..but brokerage rates are only a factor to the very shortest of
> term traders. Slippage is far more important. These are facts..once
> which you MUST know Norman as haven you been trading markets for over 20
> years??
>
> Adrian,
I think you are right, I am am imbecile. I believed those articles in
Stocks & Commodites mag about the risk of ruin. They said the more you trade
the greater your risk is of going broke. You may want to study up on the
difference between risk and exposure. They are two different factors and two
of the most misunderstood concepts in the area of money management. On the
other hand, you would be a fool to take any advice from an imbecile.
Cheers,
Norman
P.S. I started trading in 1972. I ain't smart enought to figure out how many
years that is. Maybe you can?
>
> >
> > Jim,
> >
> > I was going to stay out of this until your last statement ".
> > The real value of Hurst's work is to show that profits are >
> > maximized by short term trading." Most of the studies I have
> > seen indicate that the more you trade the greater your risk
> > of ruin. Each time you trade you take a risk. The more you
> > trade, the greater the risk. Very few of the really big
> > traders - investors such as George Soros or Warren Buffett
> > made their money doing alot of short term trades. The big
> > money is made riding the big moves and not getting in and
> > out. Some of the saviest traders I met during my Chicago days
> > made their big money on a few big moves. The short term
> > trading was just rent money. I propose to ammend the above
> > statement to read, "...that brokers profits are maximized by
> > short term trading."
> >
> > Regards,
> >
> > Norman
> >
> >
> >
>
>
>
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>
>
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>
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