How to develop an edge? - Psychology and Money Management | futures io social day trading
futures io futures trading


How to develop an edge?
Updated: Views / Replies:3,012 / 28
Created: by rhuz Attachments:3

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 3  
 
Thread Tools Search this Thread
 

How to develop an edge?

  #1 (permalink)
Padawan
DF, Mexico.
 
Futures Experience: None
Platform: Sierra Chart
Broker/Data: IB/DTN IQ Feed
Favorite Futures: Futures and Stocks
 
rhuz's Avatar
 
Posts: 285 since Apr 2014
Thanks: 354 given, 397 received

How to develop an edge?

Hi friends.

I always read everywhere i have to develop a methodology that works for me and fits my personality. The thing is, i don't even know what that means. I'm currently reading Van Tharp and Brett books and they explain for example that according to my life experiences i have developed a bias, a way of looking at the market. But i think the problem with me lies in that i can not recognise that bias. I know my personality out of the markets (like shy, introverted and stuff)because i've read some books about personality to help me, but i don't know what thinks to look for in terms of market. I would appreciate so much if you could help me with some resources (books, websites, webinars, blogs, people, etc).

I think all the material out there is focused on people who already have a methodology and just need the confidence on executing it (post methodology discovery). But at the moment i haven't found anything pre methodology discovery.

So far the only thing i know is that i don't believe in technical indicators.

Thanks.
Rhuz


Last edited by rhuz; November 25th, 2014 at 04:49 PM.
Reply With Quote
 
  #2 (permalink)
Quick Summary
Quick Summary Post

Quick Summary is created and edited by users like you... Add FAQ's, Links and other Relevant Information by clicking the edit button in the lower right hand corner of this message.

 
  #3 (permalink)
Elite Member
Melbourne, Victoria, Australia
 
Futures Experience: None
Platform: TWS, NinjaTrader
Broker/Data: numerous
Favorite Futures: index and currency futures, stocks, options, warrants
 
kickmic's Avatar
 
Posts: 265 since May 2011
Thanks: 42 given, 336 received


cool post - this is more of a "place holder" to remind me to come back and elaborate when I have the time, meanwhile...

"edge" is thrown around a lot - so much so that I'm not convinced everybody deeply understands what it means. Firstly, be sure you know what it really means. Douglas does a great job of breaking it down


ignoring indicators, just looking at other peoples journals who are kind enough to post where their entries and exits are on charts is a great place to start.
losing characteristics include:
  • a bunch of trades where positive and negative outcomes are of similar amounts, or worse, losers are larger than winners
  • trading against the trend, trying to repeatedly pick tops, or bottoms
  • over trading - not trading near the edge - but lots of entries and exits within a predominant move
  • the most important point - no testing to see the presence of an edge by looking at the outcome of a whole bunch (say 20-40) trades at a time

Reply With Quote
The following user says Thank You to kickmic for this post:
 
  #4 (permalink)
Elite Member
Quebec
 
Futures Experience: Intermediate
Platform: NinjaTrader wt Rancho Dinero's profiling tools
Broker/Data: Stage 5 trading/AMP/CQG
Favorite Futures: ES, NQ, YM
 
trendisyourfriend's Avatar
 
Posts: 3,697 since Oct 2009
Thanks: 3,041 given, 4,496 received

If you can take advantage of the mistakes of other traders on a consistent basis then you are on your way to find an edge. The next step is to find how these mistakes materialize on a chart and then begin to train your brain to recognize them as they emerge on the right side of the screen. Finally the hardest part, putting your money on the line and root-out the mental blocks you'll surely discover.

Reply With Quote
The following 4 users say Thank You to trendisyourfriend for this post:
 
  #5 (permalink)
Trading for Fun
Gainesville, Florida, United S
 
Futures Experience: None
Platform: TWS
Broker/Data: IB
Favorite Futures: Stocks
 
Posts: 66 since Dec 2010
Thanks: 30 given, 104 received

Below is a passage that I recently posted to another thread. It should be lessons 1-100 on what to NEVER do in attempting to developing an "edge." It's like poison candy to starving children, for some reason.
------------------------------------------------------------------------------------------------------------------------------------
Another snippet from "Gambling Theory and Other Topics" by Mason Malmuth.

"Any competent statistician will tell you that one should first form a hypothesis and then collect data to either (statistically) confirm or reject the hypothesis. The way NOT to go is to collect data first and then look for patterns or trends to exploit. The reason that collecting data first is flawed is that with a large body of data, pseudo-patterns, which are logically flawed, will appear."

Peace,
Paige

Reply With Quote
The following 3 users say Thank You to Paige for this post:
 
  #6 (permalink)
Membership Temporarily Revoked
Calgary Alberta/Canada
 
Futures Experience: Advanced
Platform: TDWaterhouse
Favorite Futures: stocks (long term)
 
Posts: 934 since Feb 2014
Thanks: 180 given, 777 received


rhuz View Post
Hi friends.

I always read everywhere i have to develop a strategy that works for me and fits my personality. The thing is, i don't even know what that means. I'm currently reading Van Tharp and Brett books and they explain for example that according to my life experiences i have developed a bias, a way of looking at the market. But i think the problem with me lies in that i can not recognise that bias. I know my personality out of the markets (like shy, introverted and stuff)because i've read some books about personality to help me, but i don't know what thinks to look for in terms of market. I would appreciate so much if you could help me with some resources (books, websites, webinars, blogs, people, etc).

I think all the material out there is focused on people who already have an edge and just need the confidence on executing it (post edge discovery). But at the moment i haven't found anything pre edge discovery.

So far the only thing i know is that i don't believe in technical indicators.

Thanks.
Rhuz

and @kickmic


Quoting 
ignoring indicators, just looking at other peoples journals who are kind enough to post where their entries and exits are on charts is a great place to start.


Hahahaha....my "edge" is that I do understand several indicators and their interactions. And yes, I exploit that knowledge as much as possible.

To me if you have to ask what your "edge" is you have not really developed a your trading strategy. It is not something that you can be taught. Why are some sports figures more successful than others? Why are some business men more successful than others? Why are some contractors/architects world class and others are mediocre?.... the list could go on....

I doubt very much that the most successful had to ask others how to be top of their craft. Book learning and seminar watching take you to a certain level but to gain an edge you must see something you are better than the normal....and you exploit it to your benefit.

You have not found that inspiration yet it seems....no one can direct you

Reply With Quote
 
  #7 (permalink)
Market Wizard
Boca Raton
 
Futures Experience: Advanced
Platform: Variety
Broker/Data: Optimus Futures, LLC
Favorite Futures: Futures
 
mattz's Avatar
 
Posts: 2,059 since Sep 2010
Thanks: 1,933 given, 2,783 received
Forum Reputation: Legendary

There is no "edge".
A real edge comes from you knowing something that others don't, and how many can claim that?
Never think that anyone is smarter than the market.

If you develop a set of skills as a trader, you analyze your chosen market and notice
certain market behaviors that you act upon. This is your method.
Investigate how to execute your method relentlessly. execution is king(!) and sadly very under-appreciated.

You learn to deal with the ups and downs of your strategy once you test it.
Expect drawdowns, big ones, sometimes huge ones. Nothing is linear.

At some point go live and don't become a perpertual social butterfly paper-trader. When you will trade live you will get appreciation for liquidity, commission effect on strategy, your moods in lieu of real money traded and length of time for each trade. This will all lead to better implementation of your strategy.

Lastly, don't say you don't believe in something just because there is a consensus. People trade different time frames where different tools help in a variety if ways.
I hope this helps.

Matt

There is a substantial risk of loss in futures trading. Past performance is not indicative of future results.

PM with any questions about optimusfutures (800) 771-6748 (561) 367 8686. THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES TRADING.

Last edited by mattz; November 25th, 2014 at 03:56 AM.
Reply With Quote
The following 4 users say Thank You to mattz for this post:
 
  #8 (permalink)
Elite Member
Melbourne, Victoria, Australia
 
Futures Experience: None
Platform: TWS, NinjaTrader
Broker/Data: numerous
Favorite Futures: index and currency futures, stocks, options, warrants
 
kickmic's Avatar
 
Posts: 265 since May 2011
Thanks: 42 given, 336 received


mattz View Post
There is no "edge".
.

i don't think of edge like this at all.
a set of circumstances, scenarios, patterns, call it what you will align prompting the trader to make a trade.
the trader who really is exercising his/her edge accepts the outcome of the trade as uncertain. However, the trade is made on the basis of having made the same trade (including the risk management and profit management strategy) hundreds of times before, and that over a large sample base produces a positive outcome.

the edge ceases to exist when the outcome over a large sample base no longer produces a positive outcome, hence the need for continued review of groups of trades.

I interpret the original post as learning an approach to the market that when repeated over a large sample base produces a positive outcome.

Reply With Quote
The following user says Thank You to kickmic for this post:
 
  #9 (permalink)
Market Wizard
Switzerland
 
Futures Experience: Intermediate
Platform: Investor/RT
Broker/Data: IB / DTN
Favorite Futures: Futures
 
Posts: 4,128 since Feb 2012
Thanks: 3,780 given, 7,655 received
Forum Reputation: Legendary

Edge

Edge simply means:

Know Thy Market!

This is the best way to describe the moment where you can guide your vehicule without the help of others.
To find this edge needs quite some "training". And time.
But to find a system that fits your personality - this is quite another chapter:
Define for yourself how much time you can and will invest for a trade. Now and in the future.
Then you define which daytime is best for you personally when you regularly want enter / exit your market.
Inspect carefully then what happens in that time within the market - movements, directions, volumes etc.
By then you are not far to make the right decisions to press some points out for yourself.
And you may put your own system to do right this.

Good Findings!
GFIs1

Reply With Quote
The following 2 users say Thank You to GFIs1 for this post:
 
  #10 (permalink)
Padawan
DF, Mexico.
 
Futures Experience: None
Platform: Sierra Chart
Broker/Data: IB/DTN IQ Feed
Favorite Futures: Futures and Stocks
 
rhuz's Avatar
 
Posts: 285 since Apr 2014
Thanks: 354 given, 397 received


My mistake for using the word edge (i already edited it), i think that caused a lot of confusion.

What i as trying to say is that i need help developing my methodology(and no, i'm not asking for yours). Have a clue on things like, what to look for in my personality so i could consider a trend system or a mean reversion for example or if i'm a patient person maybe scalping is not for me. I was looking for things more like this.


Quoting 
But to find a system that fits your personality - this is quite another chapter:
Define for yourself how much time you can and will invest for a trade. Now and in the future.
Then you define which daytime is best for you personally when you regularly want enter / exit your market.
Inspect carefully then what happens in that time within the market - movements, directions, volumes etc.
By then you are not far to make the right decisions to press some points out for yourself.
And you may put your own system to do right this.

Not like this.


Quoting 
Hahahaha....my "edge" is that I do understand several indicators and their interactions.
To me if you have to ask what your "edge" is you have not really developed a your trading strategy.

That's just what i was saying.


Quoting 
There is no "edge".
A real edge comes from you knowing something that others don't, and how many can claim that?
Lastly, don't say you don't believe in something just because there is a consensus. People trade different time frames where different tools help in a variety if ways.

I think the edge exist but is not what everybody thinks, if i don't have an edge i simply can't make money. The edge could be in my mind, in my ability to read the market or anywhere else but i have to be comfortable with it. And in terms of knowing something that others don't the only think i believe i have to know and others don't know is myself/themselves. That's how i will develop and strategy that i will feel comfortable trading.

For the indicators part for @Underexposed indicators are what you use and that's your bias or way of thinking so that's what works for you. For @mattz i don't say that about indicators just because others say so. I say it because indicators based on price are lagging and at the end is just another way of looking at price, that's my bias or way of thinking and i don't think that indicators are what drives price up, down or sideways. People use them, it's fine that's what works for them.

Thanks all for your comments.
Rhuz


Last edited by rhuz; November 25th, 2014 at 04:57 PM.
Reply With Quote

Reply



futures io > > > How to develop an edge?

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Jigsaw Trading: TBA

Elite only

FuturesTrader71: TBA

Elite only

NinjaTrader: TBA

Jan 18

RandBots: TBA

Jan 23

GFF Brokers & CME Group: Futures & Bitcoin

Elite only

Adam Grimes: TBA

Elite only

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
How to develop T4 Custom Indicator jsk123 CTS T4 3 November 6th, 2014 08:50 AM
How to Develop/Build/Prove an Edge Futures Operator The Elite Circle 12 July 26th, 2013 06:04 PM
Is Iran Trying to Develop a Missile That Could Hit US? Quick Summary News and Current Events 0 February 3rd, 2012 08:30 AM
Webinar: How to develop a methodology mattz The Elite Circle 37 December 30th, 2011 04:56 PM
Wanted: Programmer to develop optimizer Zoethecus NinjaTrader Programming 1 May 12th, 2010 06:26 PM


All times are GMT -4. The time now is 04:51 PM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-13 in 0.17 seconds with 20 queries on phoenix via your IP 54.90.92.204