dojirock wrote:aliassmith wrote:dojirock wrote:I had a lengthy discussion with a group of friends in which some of them are traders. It was about statistical edges to use in trading. A number of them keep moving from one method to another, in search of the holy grail. My point to them was, before risking any real money, to do their own statistics and journaling to discover what the edge is. Some in the group just believe everything they read and have been losing alot of money. My example to them was if I told them they could get rich by just trading the higher count of momentum bars, once it surpasses the previous run of momentum bars. I have no idea and actually doubt it would be a statistical edge, but until they take the the time to journal and do the math, they are just throwing their money away. It was something i just made up to prove a point. I referenced you Tro, in the conversation by telling them I highly doubt that you would ever just trade based on someones word. That you have thousands of hours in finding statistical edges.
I wouldn't trade by someone's word until I trade it for awhile using demo or small size.
Even if it is an edge they will still mess it up without practice.
for sure... unfortunately many of them wont be trading for long before they move on to something else... just a prediction..
My trading instructional process is actually to start with basic trading then moving on to trying various methods. Once we try several methods we evaluate how the person did with them. We pick the one that "did the best" then focus only on that method for a good 6 months.
One reason I see people are jumping around is because they see "grandma" on youtube making 100% a day in her Lamborghini. You can switch grandma out for anything, but you get the point. Too many people think that is real and want to believe it because they are under capitalized and need hope.
What are some baselines to consider?
***Can you perform better than the index (DOW, S&P 500)
***Can you outperform real estate (Rental income and wright off)
***Can you outperform funds (Hedge or Mutual)
How about do something small like make 5R in a month.
Maybe from the beginning they should consider how they would trade $100,000, $300,000, or $1 million.
Trading is a business with a lot of upside yet most don't compare it to anything tangible. The youtube guy took a year to build his business up to $250,000 and put a lot of time into it. The Amazon dropshipper has to put together many moving parts and success doesn't happen overnight. Starting a McDonalds takes a few million to start and training to make 20% return on that capital.
Being properly capitalized today is easy compared to years ago. I have tested some things out so I can share them with people I know in real life. All I will say is you don't need to make 100% a month if you have real skills.
