How To Think Correctly

[henry766]

good point cyof , and whats more you do that for a few weeks and you don't have to give much thought to money management or risk becuase you've already made more than your money back , and you also don't have to give much thought to psychology , just have to keep doing what your doing is all.

 

[CYOF]

That you found little or no value in paper-trading and/or testing does not mean that there is little or no value in them. Most beginners don't know how to do either.

In any case, expectancy has clearly become your grail, and you seem quite zealous in pursuing it. Perhaps everything will work out as you expect (no pun intended).

Db

Fair comment - each trader will have to discover for themselves, and as I have stated I have not done this yet, but I will not know until I try.

What I have given is my opinion, based on my experiences to date. I see value, others may not see the same value. I can do no more at this stage. Each reader will have to make their own mind about what they want to do for themselves.

In relation to the Expectancy thread, I will copy relevant posts over later, as I have to get some wok done between these posts

 

[henry766]

bit out of sync , above was in reply to cyof's 1.3 profit factor daytrading results!!

 

[dbphoenix]

Do you trade pairs dbphoenix? it's an interesting area ( in my view).

Nope, just the NQ. It's simple and I don't have to think about it much. But then I've been doing this a lot longer than most and have gotten lazy.

Db

 

[henry766]

Enough said , but do you think your trades would win on pairs ?

 

[CYOF]

Expectancy (proficient expectancy) is directly proportionate to Ability.

All else is guesswork.

As I said Socrates , I like your posts.

You are like the wise man who says little (well, at certain times that is :cheesy: ) but watches everything, waiting for that moment to make one simple point, that is of course correct.

But how does one improve on ones ability?

As every effect has a definite cause -surely it is wise to know the cause well?

 

[henry766]

the reason i ask is that if pair trades work half as well as single stock trades ( TA wise) there are so many potential pairs that one would be spoilt for choice when it comes to finding perfect patterns /trades.

 

[darkwanderer]

The title of this thread I find amusing. Correct by whose standard? This is a load of BS, excuse my french.

Either you can trade or you can't. It is like any other job. Some are good and some are c'rap at it. All this psychobabale is a waste of time. Very few people can make money trading because it requires intuition that only some people have the potential to develop. You can be a complete lunatic (and not think 'correctly') and make a living trading. It is a job, no point making a big deal out of it. If you can't do it, find something esle you can do. There are a lot of things you can do to make money. Trading is just a boring occupation like many others. You may be rich because you trade, but who gives a s'hit? I go to the same supermarket I used to 5 years ago when I had a full time job I hated, I still go to the toilet and stink, I still drive, sit in traffic, sleep about 7 hours a day, breath the same air. My life is pretty much the same except I can travel more comfortably. Am I happier now than when I was struggling? No.

All of this makes no bloody difference. Try it and see if you can do it. It doesn't matter if you win or lose. I mean that in the deepest sense. It makes absolutely NO DIFFERENCE AT ALL. One day you will die and will find all this BS as if trading is the best thing in the universe is stupid. Give it a shot if you want to. You will find out in about 2-3 years if you can do it. If you can, then you got a new job. If not, do something else. It doesn't mean you are a failure. It just means you tried ONE THING and it didn't work out. There are di'ckheads and b'astards in trading, as well as good people, like any other walk of life.

A successful trader is someone who just makes a living trading, rather than flipping burgers or sweeping the street or presenting a case in court.

Thinking 'correctly' doesn't come into it. Like any other job, you need some talents and skills specific for trading. Some people have them and other don't. END OF STORY. No reason having a bl'oody heart ache about it and listening to some ridiculous, laughable nonesense from d'ickheads talking absolute tosh about how they are on a different level and live with certainty and all that c'rap.

D*ckheads? You got sucked in like a helpless little lamb. Shame you couldn't rise above it. But, i guess character traits like that reflects in your trading, FX.

 

[dbphoenix]

Expectancy (proficient expectancy) is directly proportionate to Ability.

Expectancy is directly proportionate to the formula one uses and how he defines his terms. Ability is more accurately reflected in the equity curve, particularly over time.

Db

 

[new_trader]

As I said Socrates , I like your posts.

You are like the wise man who says little (well, at certain times that is :cheesy: ) but watches everything, waiting for that moment to make one simple point, that is of course correct.

But how does one improve on ones ability?

As every effect has a definite cause -surely it is wise to know the cause well?

CYOF, I find this bordering on insulting. Re-read all the posts and you WILL SEE how one can improve ability

Suddenly, you aren't talking expectancy anymore

 

[CYOF]

In the early days I started trading a system that had a long term average net profit of around 0.5 points per trade. The system generated around 15 trades per month so I was expecting to make 0.5 x15x50 = $US375/month per ES Contract if I followed the system RELIGIOUSLY. Not bad, trade 10 contracts and I could make a decent living. But this also meant I had to ignore the fact that the more I traded, the more I began to recognise which trades were likely fail and which were likely to succeed. I was right more often than not, but my experience was being held hostage to a system with expectancy. When I tested the system with more historical data I was horrified to discover that there was a period between equity peaks of over 500 trades. This meant it took over 2 years trading this system everyday...everyday...everyday...just to get back to where I had last been on the equity curve. Needless to say, I don't trade that system anymore. If you still think "Expectancy" is everything, good luck to you.

NT,

Copy this over to the Expectancy Thread, if you like that is, and we will continue from there.

I am going to do up an excel sheet, into which we can put the figures for evaluation.

It might be next week, but I will do it the first chance I get.

At the moment it is only discussion, lets put the thoughts into actions and see what happens.

 

[henry766]

"Expectancy (proficient expectancy) is directly proportionate to Ability."
for this to be true of everyone , everyone would have to be the same , there are some of low ability and with no confidence , some with great big belief and expectation , with little to support it , some of great ability and also great big egos ( and expectation ) , and visa v , so unless one believes everyone to be made the same way , this cannot be true , one of those things that sounds good , but think about it , ... just pompous rubbish .

 

[dbphoenix]

the reason i ask is that if pair trades work half as well as single stock trades ( TA wise) there are so many potential pairs that one would be spoilt for choice when it comes to finding perfect patterns /trades.

Unfortunately, beginners make a great many assumptions based on what they read, and often draw a great many conclusions as well. A lot of money is lost this way.

There's no substitute for experience. Formulate a hypothesis. Test it. Get past the guru-of-the-moment. The reality is in price and price movement, not in what one thinks or feels about it. You don't need anybody in order to determine that reality and profit from it. What's required is time, effort, patience.

Db

 

[new_trader]

NT,

Copy this over to the Expectancy Thread, if you like that is, and we will continue from there.

I am going to do up an excel sheet, into which we can put the figures for evaluation.

It might be next week, but I will do it the first chance I get.

At the moment it is only discussion, lets put the thoughts into actions and see what happens.

CYOF, I respectfully decline the invitation. I am nowhere experienced enough to be of benefit to anyone. Apart from that, I get the impression you want someone to hand you a profitable trading strategy on a silver platter. I hope you are not offended. Good luck to you.

 

[SOCRATES]

"Expectancy (proficient expectancy) is directly proportionate to Ability."
for this to be true of everyone , everyone would have to be the same , there are some of low ability and with no confidence , some with great big belief and expectation , with little to support it , some of great ability and also great big egos ( and expectation ) , and visa v , so unless one believes everyone to be made the same way , this cannot be true , one of those things that sounds good , but think about it , ... just pompous rubbish .

Yes, ,exactly, because it does not apply universally, it applies selectively.

What is more, it does not lend itself to be manipulated in the way you would like, sorry.

 

[dbphoenix]

I am nowhere experienced enough to be of benefit to anyone.

I disagree. Anyone who's actually done the work can be of benefit, at least to beginners. Too bad you weren't posting a journal when you began your journey

Db

 

[dbphoenix]

What is more, it does not lend itself to be manipulated in the way you would like, sorry.

Of course it does. All one has to do is massage the definitions, if not the data, if not the formula.

Db

 

[CYOF]

CYOF, I find this bordering on insulting. Re-read all the posts and you WILL SEE how one can improve ability

Suddenly, you aren't talking expectancy anymore

As I keep saying, I will speak what is on my mind, no matter what.

What I read from Socrates post is that:

Originally Posted by SOCRATES
Expectancy (proficient expectancy) is directly proportionate to Ability.

Your results - your Expectancy figure - will be in direct proportion to your ability as a trader. The greater your ability, the greater your expectancy will be. I see nothing wrong with this statement - are others reading it differently, and if so please explain, as this is how I read it?

All else is guesswork.

This is also correct in my view - if we do not know our Expectancy figure (or where exactly we are with our trading results), then we do not have a true reflection of our ability.

Anything else is guesswork - no?

Maybe I do think differently than anyone else, but this is how I think.

Would anyone else like to evaluate the statement, and we let Socrates reply?

 

[dbphoenix]

Suddenly, you aren't talking expectancy anymore

No, we've taken a further detour into the realm of belief, and the frequent disconnect between the theoretical and the real. Best to let it lie.

Db

 

[henry766]

Thats handy socrates , your "generalisation only applies selectivley" , bit like this one , traders end up winning in the end , true if applied selectivley , otherwise it's pompouse rubbish .