But then wouldn't that mean discretionary trading is also useless act?

Discretionary trader here.

I'll state a few reasons why I believe automation will never work for a retail trader:

1. Direct competion (hence, no win) with institutional quants.
2. Exorbitant costs in terms of comission.
3. Bots trading off the news (instant change of market behaviour while your algo is relying on lagging indicators).

And, to add, I don't know a sigle successful sytem trader on the retail side, while there's a lot of proven disctretionary traders that I know of.

Not meant do discourage, just a few subjective points to consider.

Thanks.

Not to divert attention from the thread topic but I had to say, there is definitely growing trend with men who are now avoiding marriage all together because of the reasons you mentioned.

Its worth is questionable given amount of mental circus you have to do to just live your life a little.

Your post was great to read, thanks! I also support Binon in his journey, its time consuming, but its worth doing it, so keep up, its good as long as you are honest to yourself.
/In before all the wives attack me

What LastDino says is true. It seems that many discretionary traders believe I am referring to HFT. I am not at all. All I am referring to is creating automated strategies, in my case using BlackBird, to create trading scenarios, exactly as an indicator-based discretionary trader would do, then allowing the computer to automatically enter the trade. Depending one one's objective, these bots could be trading 1-minute bars (not me) to daily bars. In my case I am using 2500 tick charts on MNQ or 1000 tick charts on MES futures contracts. If the last 2500 tick bar meets the entry criteria, then the trade management software, Blackbird in my case, executes a stop limit order 2 ticks above the high of the signal bar.

Just like discretionary trading, I have established the rules of the trade beforehand. The major difference is that while discretionary traders can use judgement and visual input to make their trades, computers cannot. But using computers can have some advantages.

• Since the computer has no judgement, you must fully establish your trade parameters prior to the trade. All traders should be doing this, but many don't, although they think they do.
• Since the trade parameters are established prior to the trade, there is no emotion involved in the decision making.
• The computer can react to market signals faster than we can manually.
• The computer does not second guess the execution strategy, but of course you can. It still requires discipline.
• The computer will not make errors unless they are programmed into the strategy
• The computer cannot fudge the results in live trading by bending or ignoring the established rules of the trade.
• The computer will not modify trade management parameters like stop or profit targets unless you tell it to. If course you can override the computer, but it requires knowledge of forethought.

One negative to computer trading vs. discretionary trading is that a human can recognize patterns while a computer cannot. This is a disadvantage vs. an knowledgeable discretionary trader. I see it as actually an advantage over the novice discretionary trader, since it has been shown that the human mind tends to see patterns where none exist.

Since I am not attempting HFT, or even scalping, on my timeframe speed of execution, location of the sever, and the ability to trade on news feeds is no more important to me than any discretionary trader on the same timeframe.

I keep telling her that 1 year to develop profitable automated strategies is not a particularly long time, but she feels the process is taking too long, and she feels I should be more productive and profitable by now. She is ready to see results.

I'm pretty sure of the answers I will get, so please indulge me and help me convince her that I am not NECESSARILY wasting time. Since we know no other traders personally, and I have no mentors, I am pretty much learning this on my own, so there is no other source for providing reasonable expectations. Thanks for your help.


Rick

@Bionan

Hi Rick,

I think your underestimating how long it will take to make a automated strategy. I worked for several years and the best I could get was break even. From what I have seen from being here on FIO for 9+ years this is the norm. Very few if any ever make it. From what I observed outside of FIO you need to be well funded with a team of coders to make it long term. IMO - your time and effort could be better spend learning a different trading skill. Personally I would suggest options. If you know how to read a chart you can make money in options.

Robert

Thanks for the recommendation, Robert. I am open to all ideas, and can incorporate more than one idea. I have traded options before, and there are certainly more intricacies than simply buying or selling a futures contract. Are you referring to trading calls and puts based on the underlying chart, writing calls, or more complex combinations?

Thanks-
Rick

Just a thought, but I think some of you may have the wrong wife.



mlm

The idea is to trade small and trade often and create a money stream.

I'm happy bachelor, but yeah, its difficult to get wife or even girlfriends who agrees to all this, if you managed it then good on you