That is one big radical change in approach!!! But entirely understandable. How did you end up with choosing that route?
Having said that, I am not sure I fully understand what route we are talking about here! Evidently, you are looking to go the maths/programming route? That will surely be an interesting expedition but I wonder how far it can go? Is that not the domain of the big funds/bänks etc with huge computing capacity, data access and teams of varied theme specialists? For example, is not the profit objective of studying price inefficiencies derived from arbitrage type trading, which is characterised by huge positions for small movements?
I can understand your interest in these fields, but I am not sure of where the profit opportunities are created for [I]retail [/I]traders…or are you looking at eventual employment in this field?
But I am probably perched totally up the wrong tree here, feel free to put me straight!
Keith, thank you, and you are right: hedge funds rent a rack in the.exchanges for direct access, whereas we have to go through brokers, so even with a robot we (retail traders) cannot compete…
I think this is more of my own need to step away from subjective attachment to trading: designing a model means that once it is tested to the best of my knowledge I will take a ‘hands off’ approach, both literally and emotionally.
The important thing here is learning how to analyse data using Python, Excel, etc. like Phaz was saying… How I will be able to make money out of it is another matter…
I just re-read through your earlier posts, PMH, and perhaps only now realising how much of a change you are really making here. I kind of assumed that you were just looking at a different approach to the same thing, but I see it actually runs a whole lot deeper than that.
I have absolutely no knowledge/experience of those things you are pursuing now and will remain silent on it!
Good luck with your ventures and I hope to read one day how well it has paid off for you and your family (afterall, these decisions and commitments impact on all family members)
I think I am trying to look at this route to understand how computers could aid me, and by taking
the small computational finance course and coding course I am learning what is the way that one
can exploit machines to process orders and create models that require less human intervention
in terms of entering/executing trades.
There is no guarantee that I will find something profitable or even trade again, so this is truly my last attempt. With professional firms having computers located at exchanges and with much faster access to pricing at the source, by the time price comes to the retail trader’s computer it has a lag that puts a trader at a disadvantage.
From learning and reading, and starting to practise coding, as well backtesting existing models, I can hope to understand what computer-based trading can do for a retail trader. It is far too early on to load myself with making any decision, or to try answering questions until there has been enough learning time. What I hope to do is to be more discerning about the KIND of learning that I will be doing. I have no expectation of success at this point, and real money has been lost, so any new venture will have to paid in human capital through time spent demo practising, given that the financial capital is unavailable.
There is no point me debating things of which I have no knowledge, so I will just finish here and thank you again for listening to my lonely voice echoing in the distance!
I don’t think that is the right answer, PMH, you are too valuable here. Contrary to some other comments above, I have valued your input with other trading-related topics. You create interest and a community here. We do not need to always be nose-down and blinkered in our own trades and successes/failures, there is plenty of room for related stuff and some humour, too.
When I came here I was a novice to forums only having previously spent time on one specific thread on one other place. It was a great pleasure to quickly make friends with people like you, Lexys, Turbo and others. I see you as the “heart and soul” of this site, a person always with something fresh to offer that encourages thought, education and even entertainment.
Lets face it, this forum has little to offer in the way serious education about trading. Most of the experienced posters only appear here to admonish or correct and rarely post anything that is of educational value for Newbies (with the exception of Lexys, who is in a class of her own). So you are the great catalyst here that binds many people. That is an important role and I really hope you continue with that.
I am only a reader here now and I really hope that I will be able to follow your offerings in the future - as well as your progess however your plans mature…
Am very impressed with your honesty and candour in this post and video. I suspect there are lots of blown accounts over the years, but I’ve not come across very many admissions, certainly ones so detailed and honest, such as yours. Big kudos.
Also, from a psychological perspective, this act of vulnerability is an important step in moving on (especially hard as a male in this seemingly bravado trading culture). And, ultimately, as a sign of character and for personal development, it is (IMO) far more important than some mistakes and a blown account.
My only suggestion would be to take some time completely away from forex to recover. We (generally) experience losses particularly hard, and with a complete wipe out like this, you probably experienced it as a big loss, emotionally. The risk in not taking some time away is that you’ll continue to be implicitly affected by it, without really knowing that it is impairing your judgement.
From a risk perspective, with the style of investing you were following, I would absolutely suggest regular adverse scenario testing. Take the top 5 adverse events from the last 20 years to hit forex and throw them against your portfolio. How does it respond? What would happen? Could you stomach it? Then double the impact of those and do the same.
Although you referred to this event as a black swan, it’s not really. These events are predictable in that we know they’ll happen, we just don’t know when. I’ve spent most of my career focusing on 1 in 100 year events, these are nothing like that. These are are maybe 1 in 5? 1 in 3? With the swiss franc last year and this one recently, evidence that these types of risk are realistic and should be expected. Particularly if you’re holding positions for long periods of time you’re inherently exposed to these risks and need to be aware of them, how they’ll impact you and be deliberate in how you accept or mitigate them.
Good to see you’ve got your average loss value lower than your average win, a positive move. Do you know why your ratio of losing trades is so much higher than your wins? Flipping a coin would get you 50/50 but your only getting 30/70.
That was well said Manxx , so well that i don’t have anything to add. PipMeHappy is well liked and respected on this thread. Keep doing your great work and thankyou.
“For an individual to think that they are going to create a computer program to trade successfully reminds me of a child thinking that they will build a space ship in their bedroom over the weekend. Pure fantasy.”
Sadly I have come to realise that with time being short I have less time for trading as I thought, and as much as I tried
to stay up late to fit it all in, it is a huge ask of me at this time. Given new demands on my time, also to do with being a dad to a young baby, I really think that my project of learning to code etc. has to be left alone…
Ps: I am still dabbling… Currently only trading one pair in a strong uptrend, and ignoring everything else. Fear Of Missing Out can be a huge distraction, so I am just focusing on trading one instrument, getting some consistency.
But entirely understandable. How did you end up with choosing that route?
Evidently, you are looking to go the maths/programming route? That will surely be an interesting expedition but I wonder how far it can go? Is that not the domain of the big funds/bänks etc with huge computing capacity, data access and teams of varied theme specialists? For example, is not the profit objective of studying price inefficiencies derived from arbitrage type trading, which is characterised by huge positions for small movements?