@DarkPoolTrading:implied volatility has been trending down since its peak in 2009 making lower highs, as the market discounted each individual bout of volatility more quickly than the previous one. the market even reached a point where the attendant correlations associated with the risk /on-risk-off (roro) trade disappeared. however, china weakness, the taper, emerging market instability, and weak u.s. economic data, spiked volatility and spooked the markets. whether the present volatility turns out to be summarily dismissed (once again) remains to be seen. the factors and themes that drive the markets always change in some fundamental way (cyclical/secular) - the question is, have the markets themselves changed (structural). you pose an excellent and relevant question that has important implications for traders. we may be looking at a discontinuous structural change in the connection between geo-political events and market outcomes (and an entirely different market paradigm has begun to emerge), OR this could be a cyclical event, and the market sees a reversion back to the low volatility/ roro trade.
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Last edited by tigertrader; February 6th, 2014 at 11:20 PM.
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@budfox: no matter how you look at it, you have to learn before you earn. this pertains to any performance related endeavor. the structure of the learning process is of critical importance. most learning efforts fail because there are too few cycles of "performance-feedback-goal setting-corrective effort, for the time invested in the period of study, and no clear progression guiding the content of those cycles. there has to be a structured process of expertise development to guide one from the novice stage, to competency, and on to expertise, which includes market knowledge, mental and emotional preparation, methodology, and money management. and, it must be relevant to the current trading environment- not yesterday’s.
this forum operates on some level where useful information is transferred from the knowledgeable to the uninitiated, but all too often it functions more like a support group. people believe what they want to believe, see what they want to see, and hear what they want to hear. they tend to avoid information that contradicts what they already think or believe, tend to seek out other like-minded people, and rarely venture out from their comfort zone. this herding behavior is evident in the collective participation in individualized threads and its participants' dogmatic adherence to it's precepts. a cult-like phenomena fosters a "follower mentality" that inhibits one from reaching reasoned conclusions based on a reasoned process, and from having an "open mind". it only serves to reinforce a self-limiting behavior and a parochial view, that is not much different than the one-sided, collective sentiment of market participants.
the result is that 80% of the ideas that are freely exchanged on this site are invalid. they are misguided, anachronistic, simplistic, irrelevant and often just plain wrong. the dilemma is, how does one separate the wheat from the chaff. logic would dictate, and it is confirmed from my personal experience, that the best place to seek knowledge is from someone who is extremely knowledgeable and experienced. so for starters, i would question the quality of the sources of the advice you are seeking, and look to those individuals who have already, successfully accomplished what you seek to achieve.
even after +40 years trading professionally, i still seek to improve my trading, through the acquisition of market and trading knowledge, especially in the areas where i feel i am ignorant. i accomplish this by exposing myself to people that are even more experienced and more knowledgeable than myself, experts-in-the-field, if you will. at the same time, i continue to be a student of the markets and trading. it is no different than being a doctor, lawyer, or accountant; knowledge quickly becomes obsolete and must be kept up-to-date, so i strive to read all the topical and relevant material i can find. the problem is you can never know the accuracy of the information you receive, nor the motivation of the provider. behind any source, may hide self-interests, ignorance, or bias. the value of any piece of information you read or listen to, must be questioned, and the noise must be filtered out. this an acquired skill unto itself, (like being a good researcher) that come with experience, and trial-and-error.
i realize this is very theoretical sounding and not very practical in nature, but it is not without its reason. learn to think critically(on your own) and don't be a follower. the way you choose to learn and acquire expertise in trading is as important as the actual process. so, give it careful thought and approach it logically - develop a plan and then execute the plan. forget about popular opinion and don't take anything at face value. organize and filter your ideas and determine what is relevant, but allow conflicting ideas to generate new conclusions. keep in mind, that in theory, there is no difference between theory and practice, but in practice there is.
Last edited by tigertrader; February 8th, 2014 at 03:13 PM.
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...people believe what they want to believe, see what they want to see, and hear what they want to hear. they tend to avoid information that contradicts what they already think or believe, they tend to seek out other like-minded people, and rarely venture out from their comfort zone. all this serves to accomplish is to reinforce a self-limiting behavior....
Absolutely right, tiger, people are very defensive about what they believe and won't allow any information that contradicts...
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@supermht: researchers found that people are about twice as likely to select information that supports their own point of view (67 percent) as to consider an opposing idea (33 percent) and 3 times as reluctant to consider differing perspective when it pertains to politics and religion. one could only imagine what the percentage is when it comes to money and trading!
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Thank you for taking the time to respond to my post, the reason I asked you is that you seem to be extremely experienced and skillful. I love reading your posts, they are very entertaining.
I am definitely willing to learn before I earn, the issue is what should I learn? What is the grade one material? the grade two material? There really is no structure to learning how to trade. I think a lot of the problem with novice traders is that they dont know where to turn for education of the markets, ie. should they learn ACD, market profile, etc.
I think its harder to become a trader than a doctor, or lawyer; If you want to become a doctor or lawyer you go to med/law school and they train you the skills to become a successful doctor/lawyer. There are highly experienced doctors/lawyers who can guide you.
There are no (or very few) credible (credible = not a scammer) formal academic instituitions that can effectively train traders. The only ones I can think of is Topsteptrader and Anton Kreil.
So this is the main issue I am having, knowing what are the next steps to improving as a trader. Learning how to trade from browsing google is informative, but not always effective.
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I am currently in the middle of listening to the embedded webinar and it is fantastic. If the other ones linked below are it are only half as good...it will be an incredibly fruitful investment of my time.