Here's why you're failing to learn how to trade:

[SweetLyrics]

I can only go back to May 2018, so I don't know if it's yearly. But for me, & my style of trading, there seems to have been a deep shift (july onwards). Some edges have been completely eroded - but new ones have emerged in their place. My fear is their longevity & the status quo reasserting/mushing

Or maybe you are like the proverbial blind men feeling the elephant.

I suspect that most of these 'edges' are just products of randomness. I could probably design a system based on backing horses whose names begin with a particular letter and show you peaks and troughs that look like the system had an edge which was then eroded by the market catching on to it.

[Black Ladder]

SweetLyrics your taking the piss. Obviously some Security Guard on the night shift thinking he can spend his, or her evenings trolling. Your on the wrong platform ...

[arbitrage16]

A topic that could have spawned conversation and debate around thinking in probabilities, the reticular activating system, or deeper considerations on neuroeconomics has, as per my initial response, been derailed by Simon as he alerts everyone to his struggles over finding his grand narrative.

For everyone else, understanding that there are actors like Simon in the market is of great use. A certain level of narcissism is required to turn every thread into a topic about themselves and this is a useful indicator of the ego of many traders, an ego so entrenched that they refuse to believe that ‘anything can happen’ (that Simon confuses this with randomness is also a big clue). So as Simon convinces himself that nothing is coming through that cross-over because his data suggests it can’t - “the market’s in a laying mood today” - stay flexible and open to the possibility of that £5k back order coming in and taking the price 5 ticks past the cross-over and into a healthy steam. Count your money as egoic traders like Simon add more data to their data pile.

A couple more things to say, and then I’m out on this one. To Simon, “I drink your milkshake, I drink it right up.”

For everyone else, look for clues in the difference between what people say and what they think they mean. With Simon, it’s clear that by lumping a coin toss and roulette into the same tired metaphor, he completely misses the principle. Big tip here; you aren’t the gambler, you’re the casino.

And when dealing with people like Simon, remember William James “A great many people think they are thinking when they are merely rearranging their prejudices.”

[SweetLyrics]

SweetLyrics your taking the piss. Obviously some Security Guard on the night shift thinking he can spend his, or her evenings trolling. Your on the wrong platform ...

No, I think you are.

This isn't Trade2Win.

If you want to engage in cheap personal insults because someone's opinion offends your ego, take it elsewhere.

[SweetLyrics]

Indeed, but it's not always easy to determine who is rigorously seeking the truth and leaving their ego at the door, and who is fearlessly following the facts wherever they might lead (although I'm pretty sure that the vast, vast majority of people almost always follow the former path - just a hunch based on 44 years of being on this planet).

An interesting question is: 'How do I know I am being objective, and not just talking myself into believing what is comforting?'.

And when dealing with people like Simon, remember William James “A great many people think they are thinking when they are merely rearranging their prejudices.”

[Euler]

Nobody knows where a busy, volatile market will be in 5 minutes' time, for example.

Nobody.

I do. It's perfectly possible to map and model volatility.

[Euler]

This thread is a microcosm of the market. Arguments on both side, but the there are little truths in everything. Like the market nobody, is specifically right in isolation. But also, if you worked for six years to solve a complex problem how can you expect people to understand in a couple of sentences.

It's perfectly possible to prove the market is efficient and inefficient at exactly the same time, so I've more of less given up trying to get into point scoring arguments. I just get on and do it. If people want to ask sensible questions I'll give an answer to the best of my ability in the limited time I have. But if you choose to point score, you are headed down a path of no return and are welcome to it.

I've always found modelling really useful. It shows characteristics that you may not have seen, but also allows you to describe them, which in turn allows you to predict them. Some strategies don't require that much modelling. But if the market shifts and you have modelled it, you can adjust or anticipate what happens next. If you don't model, your strategy dies and you have no idea why.

Every week I look at the prior week's data to see how it performed and compared to existing data. I always find that a valuable exercise.

I could trade very effectively without some of the work I've done. But doing it allows me to keep pushing forward and do new things and add another 0.10% to a strategy. But I realise that doesn't appeal to everybody.

[Euler]

I do think that people do get themselves tied up in knots when trying to trade. There is SO much misinformation out there that it's not a surprise. Too much focus on appealing to people to glamourise trading and so on, leads people to jazz up basic principles to the point where they stop becoming useful. Or on the other end of the scale they dumb them down, creating the same problem. I think the level of misinformation is at an all time high at the moment, so it's something I aim to address next year.

The key principles behind trading are quite simple, but there are many things to trip you up. By it's nature trading is counter intuitive and plays tricks on your mind, so even if you know the basics, it doesn't mean you will necessarily go on to trade effectively. That's the hardest bit.

[SweetLyrics]

You make a prediction that a horse will steam in.

A minute later, it starts acting up and drifts out.

How do you account for that?

Nobody knows where a busy, volatile market will be in 5 minutes' time, for example.

Nobody.

I do. It's perfectly possible to map and model volatility.

[Euler]

Trying to collapse a probability to a yes / no answer is a classic mistake.

[Euler]

My view is that they're not static (or this would be easy) and they're not random (or this would be impossible).
So therefore they must evolve (timeframes may vary). Whether that evolution is between new states of predicability or a constant change is too big a topic for this thread, and I don't want to lose focus from what was a really good posting by arbitrage16.

Spot on

[SweetLyrics]

So when you say you can predict where the market will be, are you referring to the sort of activity it will display, rather than the price?

Trying to collapse a probability to a yes / no answer is a classic mistake.

[Euler]

Both

[SweetLyrics]

I think that a lot of people waste countless hours trying to crack the 'Peter Code' - the secret formula that they think will allow them to predict the market with effortless ease and watch the money roll in.

I suspect that this is the reason Simon won't drop his search for the Holy Grail. Merely earning a decent income from Betfair by simple scalping (say) would feel like he was short changing himself, so instead he ends up going round and round in circles and achieving nothing (sorry Simon, but I do mean this constructively).

It might be worth doing a video to try to persuade people not to pursue that path.

Both

[Kai]

I think that if you allow someone to rub you the wrong way then they've already won, you're always going to be on the losing side no matter what

Why not rise above such petty squabbles, that's the only way that you can really "win". I don't think I have a problem with someone having the complete opposite opinion/approach of my own, I don't feel the need to forcibly impose my opinion on someone else. Besides, when has anyone ever in the history of internet said : "You know what, that last paragraph you wrote really struck home for me so I'm going to drop all of my core beliefs that I spent years building and I will instantly adopt your approach because it is clearly superior in every way." You've got people imposing their religious and cultural beliefs unto one another in the Brexit thread and getting into all sorts of pointless arguments, this is no different really.

The more force you use in your arguments the more resistance you will encounter, and vice versa, that's just human nature. It's always easier to find flaws in others than in yourself but when you make a thread called "Here's why you suck at trading:" then you can't exactly hope for a healthy discussion, especially if you're going to drop some names and call people out in the opening post. Sorry to say but this would be a good thread and a good discussion if it honestly didn't look like just a trap set for Simon to inevitably reply so that he could be pointed a finger at for ruining yet another perfectly good discussion.

Why do people even care so much about how others perceive the markets? Talk about a distraction If it's helpful for you then absorb it, if not then ignore and discard it, it's very simple I think. People are just trying to understand the markets and find an edge, each in their own way, even the newbie Luke is just doing his best trying to understand everything. You can either focus on the positives and find things that you have in common with people or you can tunnel on the negatives and find things that divide you.