What Is Your Trading Edge?

Beginner Questions
1

When I read the New Market Wizard, one of
the traders said to make money, you need
an edge over competition.

So I ask you, what advantage do you bring
that will give you an edge. What do you
already have that is better then other traders

My edge will be

  • My system will be based on Darwin’s natural selection
    Constantly evolving to changes in the market.
  • Logical use of back-testing
  • My skill in programming will come in handy if I need to
    create automated scripts (VBA) to save time trading
    "I am making an assumption that trading software has
    such scripts"
2

if you want to use VBA scripts or something similar then you may be referring to something like an EA (expert advisor) which can be programmed into the Metatrader platform. I also hear the FXCM broker has a new platform that allows programming and that it is better than Metatrader.

Personally I view the concept of ‘edge’ as specific trade set ups that have a higher probability of winning than loosing. Price is not random. It does predictable things. If you look at charts long enough you’ll spot things like that.

3

I’d modify that to “trade set ups that have a positive expectancy”, The win rate isnt that important.

Programing skills are useful, I’d probably go as far to say as they are definate requirement, but without an edge you are dead in the water.

As for my edge, its no secret, exploiting fat tails.

4

Oanda has a Java API for automated traders. I believe it costs $$$, though…

5

I havn’t heard of ‘fat tails’ well not in reference to forex anyway LOL, I must have missed that thread.

I’m a programmer by profession, but that’s industrial stuff. Not much good at VB or C+ or java or what ever language it is. Now give me an IBM AS400 and an RPG compiler and we’re in business!

Oh, I saw more of your hints on another thread. zooming out on the 15m sounds very much like what I did when I first got into forex. The patterns I did spot didn’t seem that good for trading so maybe I should go back for another look.

6

The mql4 programming language for metatrader is reletively easy to learn I learned it from scratch in three months with no previous programming experience, except for a little dabbling in vb6 which is entirely different

7

This is off topic but with FXCM you can use lua or C#

9

It’s true. Price penetrates Bollinger Bands far too often. 2 standard deviations from the mean is equivalent to about 2.15% of the sample. You won’t find that on a price chart.