What's worse than losing?

[EyePeaSea]

Great quote from a book (anyone recognise it - the name escapes me at the moment):
"What's the worst thing you can do to a man who has lost everything? Give him back something he had, that's broken."

So, the trading equivalent for me is not failing, but getting oh so close to succeeding and then have that holy grail skip off into the distance again.

I've worked on quite a few systems over the last three years. I've had huge fun building on my programming skill and data analysis, which is enjoyable and satisfying (and it kept me out of the pub). And the general trend is that each gets a little closer to meeting my goal.

Today was an auspicious one for me. I just needed two small wins to bring me up to three consecutive months of profit. Not huge profit, but on the right side of zero. Then, bang - two losses. *Haven't had two losses in one day since I started this system in October. Financially, it wouldn't really have been different if the losses had come along tomorrow. But psychologically, 3 months of profit did seem a big milestone and to have missed that by one day is sickening.

Very disheartened at the moment. But I hope that tomorrow I'll feel a bit more like "Hey, 2 months and 30 days is good, let's make it 6 months next!". But at the moment, it's all a bit bleak.

Ian


* I'm laying, and only a handful of trades each day, so even a single loss is a bit setback.

[Iron]

So, the trading equivalent for me is not failing, but getting oh so close to succeeding and then have that holy grail skip off into the distance again.

The holy grail is like perfection - it doesn't exist!

What you need to look at IMHO is whether:

A. You have a logical and consistent approach.
B. You stake sensibly relative to your bank.

If you can answer 'yes' to both of those questions, then there's a good chance IMHO that you'll eventually get to where you want to be, especially if you tweak your approach in light of your experiences.

It took Edison many, many attempts to invent the light bulb. Don't expect working out how to take money from a group of clued up people who want to take your money to be any different.

I think sometimes people see successful traders post a big figure for five minutes' work, and think 'Wow! Piece of cake! I'm going to hop on board the gravy train too!'. Unfortunately, it isn't that easy...

Jeff

[EyePeaSea]

Hi Jeff,

Thanks for the wise/experienced and sensible comments. For all my other failings, "get-rich-quick" and "it's-easy", aren't (generally) the mistakes I make

I'm using stakes that I can afford to lose and my plodding methodical approach would give an OCD councillor a headache.

Every system I've failed at, I've learnt something from. Whether that's how to analyze things better or just understanding why odd things happen in the markets.

To use your anecdote - I bet Edison didn't just invent a nice bright bulb. He probably started off with a bulb that burnt really dimly and then went pop. But each new bulb got a bit brighter and lasted longer.

I know *why* I lose trades - wild and short term fluctuations in odds make my code think that a workable trend is occurring (which is what my system looks for). But sometimes, they are just that - 'Wild'.

Take Granville Island (Catterick today @ 15:55). Odds started climbing and they jumped to 1000 for 6 seconds before he went on to win. My system jumped in with both feet (or rather, my wallet), and lost.

But an idea occured to me just before I started this reply (it's nice it not happening at 3am, which normally is the time I have these ideas).

If I'm looking for trends, why not look on both sides of the book? Odds on one side can jump, but perhaps if I balance it by looking at both sides, I'm less likely to be fooled?

It took about 6 lines of new code to implement that in my analysis program (looking at historical data). And the results are promising.
Old system in January. 50 trades won, 4 lost. Net loss
Amended system in January. 33 trades won. 0 lost. Net profit

Ian

[Iron]

Take Granville Island (Catterick today @ 15:55). Odds started climbing and they jumped to 1000 for 6 seconds before he went on to win. My system jumped in with both feet (or rather, my wallet), and lost.

Do you normally trade in-play? Unless you're an in-play expert, I wouldn't. That could be why you're struggling to make a breakthrough.

For a start, because of the lack of liquidity there will often be a big gap between the lay and back prices, meaning you may have to pay a large premium if you suddenly have to bail and take the best available price.

Jeff

[EyePeaSea]

Yes, all in-play since October. I'm certainly not an expert in any sense. If I have any strength, it's in gathering and analysing data on the behaviour of other people. I work on market movements which are driven by people who know far more than I'll ever know, including people with the ring-side view. The tricky bit for me is to spot movements that are real trends. Trying to go with 'lots of people with small bets' rather than 'few people placing big bets'.

The risk to me is market manipulation causing spikes. For me, manipulation is where people move the price to give them an advantage in the market in terms of their overall position, rather than moving the price to reflect how the race is going. That's not a criticism of that approach, I'm just saying it's a pain in the rear for me.


The more things I do to flatten out those spikes, the better.

Liquidity is an issue, which is why even if this system works out for me, I won't be quitting the day job. But I track liquidity in my data and so I'm reasonably confident on how far I can scale up.

The beauty of keeping all the data (both sides of the book and liquidity, in 1 second snapshots) is I can try lots of different permutations. The estimated improvement in my last post was just ignoring Lay odds that were more than 100% larger than the current Back odds. I need to analyse all the data with different %ages to see what works best. Sadly, I only started recording in-play Back odds in January, so I'll have a few more months before I'll have a good idea on how well the change might work.

Again, for me, success is only needing to tip the odds in my favour by a few percent, it doesn't have to be perfect. Look at the MIT students and card counting - they just swung the odds by around 2% and did very well


Ian

[PeterLe]

...

I've worked on quite a few systems over the last three years. I've had huge fun building on my programming skill and data analysis, which is enjoyable and satisfying (and it kept me out of the pub). And the general trend is that each gets a little closer to meeting my goal.

Today was an auspicious one for me. I just needed two small wins to bring me up to three consecutive months of profit. Not huge profit, but on the right side of zero. Then, bang - two losses. *Haven't had two losses in one day since I started this system in October. Financially, it wouldn't really have been different if the losses had come along tomorrow. But psychologically, 3 months of profit did seem a big milestone and to have missed that by one day is sickening.

Very disheartened at the moment. But I hope that tomorrow I'll feel a bit more like "Hey, 2 months and 30 days is good, let's make it 6 months next!". But at the moment, it's all a bit bleak.

Ian


* I'm laying, and only a handful of trades each day, so even a single loss is a bit setback.

Morning

Ian, I wouldn't beat yourself up too much.
There are a lot of people who have been running automated systems for many a year finding it really tough (myself included) . I was looking on another forum last night and a lot of people are seeing the same things, to the point where they have abandoned their strategies. It seems all the things we have all posted about in recent weeks being the reason.

I can see from your post that you have been doing this for the last three years, so maybe you caught the seam of gold in H1 2011? If so, you can compare current with then.

Having said that; the markets are what the markets are, so whilst its OK to be able to compare with those past years, unfortunately they have gone and we are where we are.

Anyway, thought Id mention it, especially for anyone new out there pulling their hair out; it is a tough gig at the moment.
Id been keen to know if anyone is finding the opposite?!

Regards
Peter

PS I tried running on Betdaq yesterday too after a posting about a broke book. In the whole of the afternoon, I took a small loss of about £14. Which I consider break even or thereabouts
I fired in thousands of bets during the afternoon with no issues, (in previous years I got blacklisted by BQ for doing so). So thats a positive

[EyePeaSea]

Hi Peter,

Unfortunately, the data I collected back when I started isn't anywhere near comprehensive, so I can't do meaningful comparisons. And as you say - we are now where we are with the markets.

It does seem that the last 3-6 months have been tougher (going on comments in this forum). I've had some success, although definitely down over the 3 years. But being 'close', whilst not quite cracking it, does keep me positive. I think it's so easy to become disheartened for people just starting out.

Today is a big day for me. Major upgrade to my code and a tweak to the system. And it's my birthday tomorrow, so if the gods are watching, then maybe they'll give me an early present.


Regards

Ian

[kelpie]

One thing far worse than losing is if you had a previous commitment to a winning system that would have won - but for your intervention

[mugsgame]

Nothing

[PeterLe]

One thing far worse than losing is if you had a previous commitment to a winning system that would have won - but for your intervention

Kelpie, just expand a bit on that one. Not quite sure what you mean?

[kelpie]

Kelpie, just expand a bit on that one. Not quite sure what you mean?

Losing is of course painful if your system caused it.

But much more painful than losing to a system you designed is if you had a system that would have worked... except you changed it yourself, in play or whatever.

ie, you could have won despite yersel!!

[EyePeaSea]

One thing far worse than losing is if you had a previous commitment to a winning system that would have won - but for your intervention

Is that some sort of quantum mechanics type thing? The very act of participating in a system changes the outcome? I guess your actions can change how other people bet, so if you're trading on price movements, rather than the eventual outcome, then yes, perhaps that does happen. And that would be worse. Like being thirsty but knowing that the bottle of coke in your hand will dissapear the second you take the top off.

[marko236]

The more people that use bots the more silmiler systems will be used, which could lead to you's all fighting over tiny amounts of money.

Nothing will beat watching the market and trading yourself.

[Lyle]

Great quote from a book (anyone recognise it - the name escapes me at the moment):
"What's the worst thing you can do to a man who has lost everything? Give him back something he had, that's broken."

So, the trading equivalent for me is not failing, but getting oh so close to succeeding and then have that holy grail skip off into the distance again.

I'm not sure they are the same thing are they? having a broken treasure returned to you, and coming close but not close enough to a treasure ...

I have been in a similar position before. Well, I suppose we all have. I went years always catching a sight of The Grail (like damn Lancelot in the tent!) before is faded into the distance again. Thankfully these times paid off and I lucked out this time last year. Big time actually. Bought the Old Lady some pearls from mesenso.com and we skipped off to Cape Cod for a month. Alas, since then, the Grail is ever ellusive once more.

Either way i take your point, and hope things are on the up now.

[Zenyatta]

Looking as if you're winning huge then losing it all back again. Making someone think they're a huge winner then suddenly snatching it away from them; 'snatching defeat from the jaws of victory'.

Case in point: Joe McGuire, unluckiest punter in the UK, Scoop6 last week. He had 5 out of 6 legs. In the final leg, his selection 'Escape to Glory' was kicking on at the finish and he was certain he was going to scoop 10 million pounds and he had indeed finally 'escaped to glory' in his life. The horse was at 1.01 In-Play ; he was certain he'd got it. Suddenly, and horrifically, all his dreams were shattered at the post when his horse was beaten into 2nd ('snatching defeat from the jaws of victory') and 10 million pounds went down the gurgler.

http://www.mirror.co.uk/news/uk-news/jo ... er-3561831