The "Holy Grail" Quest.....

[Gekko78 10]

Hello everyone ,

 

No this is not a post about an indicator I know of that will make you rich. This is more of a collection of thoughts I just wanted to share ....feel free to comment or not just throwing it out there.

 

I am no stranger to trading , while I might be considered a rookie by some definitions as I have been trading since 2006 , I also am no stranger to trading forums such as this one.

 

One thing that they all have in common is that there are always people "searching" for the one thing that will make trading simple , easy and take only 5 minutes a day all for the low low price of $99.95!!

 

I , and I am sure many of you have to , seen such advertisements through email and on the web of people claiming they have a system that produces monstrous results and only requires 5-10 minutes of screen time a night reminds me of an infomercial for stay at home moms who try and make money doing medical billing.

 

Of course 99% of these fail to live up to any of the hype they claim . Ultimately they blow up accounts and cause traders to leave the market never to return because they think it is to hard ( which is where the 95% of traders fail comes from)

 

Now for the few that actually stick around after they have lost everything and try again , they move on to the next "system" hoping this one will be different. Maybe they found the one that only a select few that signed up for an exclusive email knows about. They are so excited that the doors have be reopened for them for only 24hrs and that's it!

 

They purchase said software only to see this one fail as well. So why do we keep buying them??

 

Well , we as humans , are greedy by nature .....it's ok there are different levels of greed but basically we are. We want all the rewards but want to do as little of the work as possible so we are sucked into the salesman's pitch......

 

Everyone is searching for the "set it and forget it" robot that will allow them to beat the market and beat the pros at their own game.

 

The problem with these systems , other than the fact that they do not ever work , is that YOU did not create them . Even by some remote chance that one did work it is highly unlikely that it will work for you since it had to be programmed by someone and their level of risk tolerance , profit targets and judgment are more than likely different from yours so you will second guess the robot or not fully trust it because you do not know everything it looks for.

 

My belief is that there is a trading robot out there that can beat ANY robot you can buy and the good news it that you already own it......It requires no purchasing , no money back guarantee and the doors never close unless you close them .....what is this robot??

 

It is your own mind......yes the piece of hardware/software, whatever you want to call it , is more powerful than any other robot on the market today .....it is the ultimate neural network ......all you have to do to use it successfully is actually use it. You need to develop your won method , created by you , back-tested by you , forward tested by you....only then will you have a system that you fully trust.

 

 

Now again you could say , " ok well I will just look for a system that another trader uses the he created and so forth and I will use that no problem" When the problem is that again it falls under the "someone else's decisions other than you" category and you will second guess yourself.

 

For example , the method I use produces pretty good results for me , again I say FOR ME , because I made it myself , I tested it with real money and I have seen its strengths and weaknesses I know what makes it work . If I just gave it away the chances of it working good for others it pretty low since you do not know what any of my criteria was when I made it, you would just see the results and that was all you would care about.Then you would start trading it and it would probably fail for you then you would call me a scammer or something like that even though it works for me.

 

 

So let your search for the 100% trading method end here , stop looking for something you already have .......start learning what makes you comfortable in trading . Stop looking for the magic indicator that will tell you the future.....there is not one. All indicators lag as the need price to calculate them.

 

Using lagging indicators in trading is like stepping outside in the rain and saying " I think it is going to rain today"

 

I have 2 things on my chart at any given time and they came with my trading platform FREE.....they are also on every other platform I have ever seen including MT4 , tradestation , TOS even on the free websites like stockcharts.com

 

I use them as a guide. Study PRICE first then indicators second ......

 

I am not trying to sound holier than thou or that I am perfect because I am not , I have losses to ........I am trying to save you the journey of 1000 miles that leads nowhere....

 

 

Attached you will see a picture of the chart I use to trade with . Nothing fancy , just 2 things and that's it........ Trading can be hard but it does not to be

Thanks

 

Gekko :missy:

Edited January 28, 2013 by Gekko78

[cjforex 10]

Another consideration with respect to a holy grail, and blowing up accounts is the reliance on a single approach. With a single approach traders are inclined to bet too heavily per trade.

 

Since all systems, and I mean all systems draw down, when betting heavily, the drawdown, even minor ones can be deadly.

 

When you can place trades, and each individual trade has no significance to you (because the trade size is very very small) and you can spread your risk among many trades, and many approaches, two things happen:

 

1. Your account drawdown becomes smoothed. This is because the drawdown of one approach is usually mitigated by the draw-up of one of your other approaches.

 

2. That $99 system actually has a chance. Every system has good times, bad times, and kick you in the teeth times. The question is can you ride out the bad times so the system can realize the good times. Only if it has a small portion of your account, and if it is among other systems that can mitigate it.

 

The last crumb of this diatribe is management.

 

There is a BBC show I think is called Traders. It's on YouTube. It's where they do an experiment and hire 10 people off the street, and train them to work in a trading room. 3 part series I think.

 

Watch it. Then BECOME the manager.

 

They constantly evaluated each trader. Gave some traders more money, gave others less. They constantly adjusted, and they started small so no trader could kill the account. Emulate it.

 

So whether you have the ability to create your own "employees" or you need to buy them for $99 each, get them. Lots of employees. Then BE the manager.

 

Don't bet the farm on some new employee of the street.

Edited January 29, 2013 by cjforex

[cjforex 10]

It's not just small traders who make the error of over reliance:

 

allaboutalpha.com/blog/2013/01/23/the-superstition-of-mean-reversion-jpmorgan-edition/

[tomerok 10]

 

Attached you will see a picture of the chart I use to trade with . Nothing fancy , just 2 things and that's it........

 

Gekko :missy:

 

Actually i see 3 things on your charts...... price......

 

I think the biggest problem was and always be most people prefer shortcuts

could be culture, could be upbringing, could be they are just plain lazy

 

some of them even go through so much trouble and effort in order to take the shortest road

and never stop to think that if they would have put the same effort in just walking the path,

they would have already been there or at least did not waste some much time in chasing something that does not exist.

 

Tomer.