Wicked_Daddy
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So for those reading this thread and contemplating the same issues of win/loss and the never ending search for expertise, I offer the following piece of info I found this morning to be quite revealing...
My brokerage offers a bunch of tools and educational videos as well as an on-going live stream of advice and insight from their group of FX strategists. They even have a signals service you can sign up for that will pretty much tell you what to do so you can "follow the experts". I'm not going to divulge who they are because that is both unimportant to this lesson and I don't need any flack from my brokerage. Besides, I like their tools and service, the rates are decent and I think they attempt to provide more than most. I also think most brokerages provide similar services.
Today, while the EU was finding its way into a rhythm, I visited the trade signals page of my brokerage. They (the brokerage) are new to me and I was curious. It had a list of previous, closed trades. So I took a sequential 20 trade section of the total displayed - a random sampling of the expert's picks. This included many different pairs, shorts and longs. I did a quick analysis of their success rate and here is what I found out of this block of 20 trades:
Profitable trades: 8 (40%)
Losing trades: 12 (60%)
Total pips earned: 564.6
Total pips lost: 663.9
Net pips: -99.3
To be fair, I went back and chose a different 20, then a combination of the 2 sets with some overlap. The results each time were in the same ballpark as above. Some of the losers were really big too, as if there was no stop protection. But perhaps the stops were just set really deep.
The moral of the story? These strategists are suppose to be experts, pros that the novice and more advanced traders should learn from. Their picks should be above the 75% success rate and their money management should be tighter than a frog's butt. Clearly, that is not the case. Why? Honestly, I could not say. But I'm also not that surprised. They are humans anyway, with emotions, and judgement flaws, etc. They make great instructional videos though. Perhaps it's a "Do as I say, not as I do" proposition.
But don't be dismayed, as if you'll never be successful at trading if even the pros can't get it right. Every year my wife and I pick the winning teams each week during the NFL football season and we keep score against each other. The winner at the end of the season gets bragging rights on being the house football expert. She kicked my butt this year. ESPN has a page during the season in which a dozen or so "experts" pick the winners each week as well. These guys are sports writers, sports newscasters, former coaches, players, etc... Experts. Every year since we've been playing both my wife and I have done better at picking winners than, almost all of these experts (there is one guy who really knows his stuff). There is a computer that makes picks as well based on every available statistic. We always do better than the computer. Experts?
So it always come back to the same thing that has been said in many books, this forum and etc.: Be responsible for your own learning. Listen, read and absorb. Seek truth. Test that truth. Test everything until confident in what you have learned is effective. Then execute without doubt while looking for changes that require adjustment and testing. Choose how you will acquire your wisdom. There are 3 ways:
- By reflection, which is the most noble
- By imitation, which is the easiest and least fruitful
- By experience, which is the most bitter
Good luck. But more importantly, good trading.
My brokerage offers a bunch of tools and educational videos as well as an on-going live stream of advice and insight from their group of FX strategists. They even have a signals service you can sign up for that will pretty much tell you what to do so you can "follow the experts". I'm not going to divulge who they are because that is both unimportant to this lesson and I don't need any flack from my brokerage. Besides, I like their tools and service, the rates are decent and I think they attempt to provide more than most. I also think most brokerages provide similar services.
Today, while the EU was finding its way into a rhythm, I visited the trade signals page of my brokerage. They (the brokerage) are new to me and I was curious. It had a list of previous, closed trades. So I took a sequential 20 trade section of the total displayed - a random sampling of the expert's picks. This included many different pairs, shorts and longs. I did a quick analysis of their success rate and here is what I found out of this block of 20 trades:
Profitable trades: 8 (40%)
Losing trades: 12 (60%)
Total pips earned: 564.6
Total pips lost: 663.9
Net pips: -99.3
To be fair, I went back and chose a different 20, then a combination of the 2 sets with some overlap. The results each time were in the same ballpark as above. Some of the losers were really big too, as if there was no stop protection. But perhaps the stops were just set really deep.
The moral of the story? These strategists are suppose to be experts, pros that the novice and more advanced traders should learn from. Their picks should be above the 75% success rate and their money management should be tighter than a frog's butt. Clearly, that is not the case. Why? Honestly, I could not say. But I'm also not that surprised. They are humans anyway, with emotions, and judgement flaws, etc. They make great instructional videos though. Perhaps it's a "Do as I say, not as I do" proposition.
But don't be dismayed, as if you'll never be successful at trading if even the pros can't get it right. Every year my wife and I pick the winning teams each week during the NFL football season and we keep score against each other. The winner at the end of the season gets bragging rights on being the house football expert. She kicked my butt this year. ESPN has a page during the season in which a dozen or so "experts" pick the winners each week as well. These guys are sports writers, sports newscasters, former coaches, players, etc... Experts. Every year since we've been playing both my wife and I have done better at picking winners than, almost all of these experts (there is one guy who really knows his stuff). There is a computer that makes picks as well based on every available statistic. We always do better than the computer. Experts?
So it always come back to the same thing that has been said in many books, this forum and etc.: Be responsible for your own learning. Listen, read and absorb. Seek truth. Test that truth. Test everything until confident in what you have learned is effective. Then execute without doubt while looking for changes that require adjustment and testing. Choose how you will acquire your wisdom. There are 3 ways:
- By reflection, which is the most noble
- By imitation, which is the easiest and least fruitful
- By experience, which is the most bitter
Good luck. But more importantly, good trading.
