Downside to automation

[mariobets]

Hi guys,

Just starting here so bear with me:) Maybe this will sound obvious to most of you but aren't you missing out opportunities for higher yield in a race if you're just using automation? Same with losing more money. If you have a set of rules in place then of course you could protect yourself (to some extend) from the volatility of the market. But there isn't really 100% proof method of automation is there?

So my question would probably be, where do you find that balance between returning home after full day of automated trading and seeing a loss, and not having to sit on every single market?

ps. obviously as i newbie i wouldn't start with automation as i think it's important to get as much of screen time as possible, before you really start to understand how the markets work.

Thanks,

[dannycutts]

I rather spend the summers outside enjoying life than sat in my office... there is a compromise

[Niko]

The hardest thing for me was balancing the fear of going into the red with a strategy and letting it run, knowing that it should (mostly) come back to green

[jimibt]

The hardest thing for me was balancing the fear of going into the red with a strategy and letting it run, knowing that it should (mostly) come back to green

that's where WATCHING automation is a no-no as you literally could reach for the manual green (i.e. RED) button thro sheer undisciplined panic. in short, set/.@~#./forget -once you've tested thoroughly.

[Niko]

The hardest thing for me was balancing the fear of going into the red with a strategy and letting it run, knowing that it should (mostly) come back to green

that's where WATCHING automation is a no-no as you literally could reach for the manual green (i.e. RED) button thro sheer undisciplined panic. in short, set/.@~#./forget -once you've tested thoroughly.

Agree, I wasn't so much testing the strategy but fixing the loss. Once I know the loss amount as long as the green is higher, it's good for me. Is hard to crack though (well it is for me!!)

[jimibt]

The hardest thing for me was balancing the fear of going into the red with a strategy and letting it run, knowing that it should (mostly) come back to green

that's where WATCHING automation is a no-no as you literally could reach for the manual green (i.e. RED) button thro sheer undisciplined panic. in short, set/.@~#./forget -once you've tested thoroughly.

Agree, I wasn't so much testing the strategy but fixing the loss. Once I know the loss amount as long as the green is higher, it's good for me. Is hard to crack though (well it is for me!!)

sometimes (many times!) it's also about ensuring that altho the loss is higher than average than the wins, that overall the game plan accommodates x losses in xx races etc... this is usually how most of my rules pan out where you typically have 1 loss in 10 but manage to balance the staking/profit such that the loss is absorbed comfortably. some rules can take MANY weeks to determine if it's even feasible to move to this next step... definitely a moving target and one where backtesting (where possible) in conjunction with daily records will get you there SLOWER but more assuredly.

[spreadbetting]

Hi guys,

Just starting here so bear with me:) Maybe this will sound obvious to most of you but aren't you missing out opportunities for higher yield in a race if you're just using automation? Same with losing more money. If you have a set of rules in place then of course you could protect yourself (to some extend) from the volatility of the market. But there isn't really 100% proof method of automation is there?

So my question would probably be, where do you find that balance between returning home after full day of automated trading and seeing a loss, and not having to sit on every single market?

ps. obviously as i newbie i wouldn't start with automation as i think it's important to get as much of screen time as possible, before you really start to understand how the markets work.

Thanks,

Manual trading versus botting is always going to be a trade off between the two somewhere along the line, you'll never get a 100% method in either. You just have to try to exploit the strengths of each approach, obviously with bots they can churn markets around the clock without getting tired but will always miss certain things that may be happening you can't code in. I doubt many successful botters look at the p&l at the end of each day though, you just have to accept variance in results is a part of botting.

[ruthlessimon]

To me, automation is best for very rigid strategies - generally those that have very short time spans (i.e. scalping & arbitrage - highly mechanical, to a point.. ). An algo will always beat a manual trader for speed & accuracy. However, as we lengthen the time horizon (i.e. 5min trades), the variables shift from quantitive to qualitative. Creating a bot that encompasses all the various 'reading techniques', pretty much becomes "almost" impossible to achieve. But like spread suggests - there is never a 100% pure quant, & a 100% pure qual - a good trader incorporates both. & by having both you have a unique edge that can never be eroded