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Gambling (with life)


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Gambling (with life)

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  #21 (permalink)
Mumbai, India
 
 
Posts: 371 since Jan 2019
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When I started out it was due to curiosity, it quickly became something that "I thought I could do on side". And dear god I was wrong.

I don't blame anyone for that, trading teaches you lot about life, about people, about money and most importantly about yourself. I discovered many many things, its akin to traveling places and learning new things.

First few years were great up and downs, the only saving grace was that I kind of started early and as a still student in my post grad course I didn't really have much money to lose to begin with. You heard it right, what saved me was having small pockets and not some ingenuous realizations.

Luckily I also got placed in related activity/organization, though rather complex process, that gave me look into other-side of the trading world, the big shots, many times my jaws were hanging due to shear amount of money I was seeing (digitally), there were numbers that I couldn't even read out in single glance. Later I left that job to pursue my "side" thing as full thing, I had also developed source of passive income for survival. Last 2-3 years have been full time tracking and trading, my current lifestyle allows me to do that.

For this purpose alone I also sidelined activities that are socially deemed most important, like that of building family early, at least in my culture if you are already not married by 30-31 and have decent enough fixed earning and own roof on head then you are considered to be -bad apple-. Even your neighbors dog judges you, completely unrelated people will harass you, give you their opinions "about you", give you looks that are akin to looking at a failure of human being. Whats funny here is that I've masters in Business management on top of having Mechanical engineering degree, I also have bunch of other certified courses under my belt that should've set me on decent path, at least according to them. Now in their eyes I'm just wasting my time, and most of these peoples haven't even went through graduations of their own. You learn here that only certificate that really matters is amount of money that you are collecting, that's the only certificate of success in the eyes of society.

I carry on, with meager profits, with meager trading earning and my humble but comfortable lifestyle. You know what keeps me on? My drive to succeed in something I enjoy doing. I may or may not start a family, I may or may not become billionaire or CEO/MD of some company. But I'm internally happy that I had guts to pursue what I liked, despite all odds, for some weird universal law of return, trading is also slowly but surely improving.

Gambling away life? I dunno, it sure looks like it, I would even say it to be true 100% if goals were still not reachable after almost 5 years (2 as uni student and 3 as responsible adult), but that is not the case, goals are slowly getting achieved.

I dunno who said it first, but there is saying here, "You are truly only wasting your life if you are not enjoying what you are doing"
I agree, its okay even if its gambling, I believe most people that duck it out in this profession have at least this much mental toughness, maybe thought process differs, but they have the same will.

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  #22 (permalink)
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Great conversation to tackle because you are right, most are gamblers.

I started off that way, looking for the easy cash these training people tell you is yours for the taking, and I experienced all of the issues you see in this site and more, up one day down the next.

I decided a long time ago to “normalize” this into a foundational business and treat it just like any other services business. After several bumps in the road I started automating, refining and applying continual improvements to a Nasdaq futures trading strategy that I operate on TradeStation. One market, One trade style…. Like so many of the others, my systematic trading product has been designed, engineered and over time has been fine tuned into a slick little tool that takes “me” out of the equation (as mentioned above). Until we can be honest with ourselves and realize that our emotions will drive us into bankruptcy, you are right…. Gambling.

10 years later I let my system run during the day, re-optimize on the weekends and just stay out of the way….. But again to be honest, if I am watching the market when my systems enters a trade, even today sometimes I will read the tape or price action and determine that I should interfere and exit or hold a position. I am always WRONG, almost 100% if I left it alone it usually works out.

Until a trader understand his biggest roadblock in this business is themselves and their emotions… you are right, its gambling.

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  #23 (permalink)
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I think there is something more to add to this discussion: are you really smart enough to make some money trading?
Some years ago I went to a trading event in Madrid (Spain) and I met a group of non professional traders, all of them were old men that traded through some CFD companies based in Cyprus, most of these companies were complete scammers.
These people did not speak a single word of English and thus had limited access to top-notch trading education.
They were plumbers, barbers and a couple of cooks.... honestly do you think they have enough formal education to understand Expected values, normal probability distribution or stuff like that?

There was also one guy, who had a clear mental deficit. He was clearly not "normal". Of course nobody can tell this person on his face that his intellectual abilities are not made for trading. During the trade fair he opened a couple of trading account with some brokers.

I think that trading is an intellectual activity and since only 1-5% or traders make money, it is fair to assume that those who make money are somewhat smarter than the average, or at least have more formal education in math or finance related material.

How honest can we be about our mental abilities? can we admit to ourselves that we are not smart enough?
What if we were like the guy with a mental deficit, nobody will ever tell us and we could jeopardize ourself and our family.

I suggest a couple of "proxies" to gauge our intellectual abilities:
1) IQ test
2) univeristy/school grades
If you were among the worst students in your class you were probably not smart enough or disciplined enough. What makes you believe that with trading you will be different?

I know this is not politically correct. But we cannot be all in the top 1% of the IQ bell shape.

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  #24 (permalink)
Mumbai, India
 
 
Posts: 371 since Jan 2019
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SamJames View Post
I think there is something more to add to this discussion: are you really smart enough to make some money trading?
Some years ago I went to a trading event in Madrid (Spain) and I met a group of non professional traders, all of them were old men that traded through some CFD companies based in Cyprus, most of these companies were complete scammers.
These people did not speak a single word of English and thus had limited access to top-notch trading education.
They were plumbers, barbers and a couple of cooks.... honestly do you think they have enough formal education to understand Expected values, normal probability distribution or stuff like that?

There was also one guy, who had a clear mental deficit. He was clearly not "normal". Of course nobody can tell this person on his face that his intellectual abilities are not made for trading. During the trade fair he opened a couple of trading account with some brokers.

I think that trading is an intellectual activity and since only 1-5% or traders make money, it is fair to assume that those who make money are somewhat smarter than the average, or at least have more formal education in math or finance related material.

How honest can we be about our mental abilities? can we admit to ourselves that we are not smart enough?
What if we were like the guy with a mental deficit, nobody will ever tell us and we could jeopardize ourself and our family.

I suggest a couple of "proxies" to gauge our intellectual abilities:
1) IQ test
2) univeristy/school grades
If you were among the worst students in your class you were probably not smart enough or disciplined enough. What makes you believe that with trading you will be different?

I know this is not politically correct. But we cannot be all in the top 1% of the IQ bell shape.

That's for sure but I would also like to add that its probably more EQ than IQ that matters.

When you get really into trading, you realize that its about doing lot of simple things right than doing lot of complex things right. Usually your lack of control on yourself is whats your undoing.

I know quite a lot of intelligent people, but very few who have developed understanding of their base nature and learned to control themselves. Lot of them trade too, but very few of them manage to be "consistently profitable", guess the overlapping group of people?

Ultimately, if I had to put down one thing that is absolutely most crucial is ability to stay "disciplined", not giving in to greed or fear. With advent of technology lot of people do that with automated trading, and this is why you will see even more people coming into picture, even more people gunning for "easy money making strategies which they can code", often they don't do enough research of their own and fall in the pitfalls, usually these people are quite intelligent, just not with enough EQ.

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  #25 (permalink)
Tel-Aviv Israel
 
Experience: Advanced
Platform: NT
Trading: ES
 
Posts: 54 since Dec 2019
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Trading is not gambling but a real business as @Jeff5801 said above.

If you do not have the base (edge, funds, emotional IQ) for this business, YES you gamble.

Retail traders need to deal with 2 major obstacles - competitive advantage= trading edge and the emotional burden. (funds are always available but not replacing the first 2 elements above)
From my experience (Trading for over 12 years. Junior partner at a small hedge fund) and talking with many traders, its too hard to deal with for the long run with out the 3 and therefore many new into this market sadly fail.

High probability winning method and as much automated signal generating/buy/sell placing orders make day to day trading a lot easier. That is our way to deal with our emotions -eliminating the greed/fear/hesitation/over thinking.

If we are able to develop a method high win/loss that shows a positive outcome over hundreds of trade with acceptable DD, the auto trade will make us winners. (see the casino game theory and try to find a casino that closed due to losses generated at the game tables- I never heard of any)

The reason most traders DO NOT go this way is due to lack of trade method to show the + numbers at the end of the day/week/month/year. System that will eliminate the fear/greed and will just follow the original trade parameters at all cost - each one of them - day in day out.

A great input that helped us in our day in day out trading are the points we took from Mark Douglas videos.
They clearly point to us how to move from a trader that plays the Roulette to be the owner of the casino.
The best advice we give to any new trader is to follow Mark's logic and trade only after you archived all part of his phases in creating your trading method. Really free gold.

https://www.youtube.com/watch?v=QgaTlTfQnZI&feature=youtu.be

Good luck.

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  #26 (permalink)
San Francisco CA USA
 
 
Posts: 40 since Jan 2020
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I would agree with DoubleUCapital, at least a little bit. Trading is both a real business and gambling. Gambling of course is not really what you want to be doing if you don’t have a system or strategy that puts the probability in your favor. However, gambling can also be a real business. If you’re gambling with the probability of success on your side then gambling is definitely real business. You can buy stock in companies that specialize in gambling, those are real businesses. If your trading, and doing it intelligently, you are gambling and running a real business. If you’re just picking your trades willy-nilly your gambling and being stupid.

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  #27 (permalink)
Tel-Aviv Israel
 
Experience: Advanced
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Trading: ES
 
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When you gamble you HOPE to win.
In the business of trading you do not hope to win. You know your win/lose ratio and you just follow your model to execute the trades. it's a real business.
No business exist on hope.

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  #28 (permalink)
San Francisco CA USA
 
 
Posts: 40 since Jan 2020
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DoubleUCapital View Post
When you gamble you HOPE to win.
In the business of trading you do not hope to win. You know your win/lose ratio and you just follow your model to execute the trades. it's a real business.
No business exist on hope.

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What about professional poker players make millions of dollars at the game, is that gambling or that something else?

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  #29 (permalink)
Tel-Aviv Israel
 
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You have the answer in your question. PROFESSIONAL.
It's a business. They have win/lose ratio and they do not hope the market will go their way.
Same as professional traders. Not hope but statistical knowledge.

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  #30 (permalink)
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Sarasota FL
 
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When "gambling" and "trading" are discussed, there's always an issue of definition. What are you going to regard as just gambling, and what is responsible management of risk?

Or, you could think of it in terms of a spectrum, with good management of risk at one end and just rolling the dice at the other, and then there would be gradations in between.

But remember that the initial intent of the thread was something else, essentially gambling addiction:


Big Mike View Post
I think that if it's viewed as a hobby, and money spent on your trading is being spent in a responsible way that doesn't jeopardize yourself or your family, then basically it's all in good fun at the end of the day -- and probably, a lot of people fall into this category.

Then there are those of us who are professionals and treat it like a business. For the purpose of this thread, we aren't taking about this category.

But... Then there are some who are literally gambling with their life. Their savings. Their families. Their kids college funds. They are maybe taking on debt. Maybe they are hiding this from their family. In fact, maybe they are hiding this from themselves.

...

I hope that you will open up and share here in this thread. Lean on the community, talk about your struggle. Maybe come clean and admit there is a problem.

This is where the issue becomes not just how to trade better, but whether actual gambling behavior has taken over someone's life, and they need help.

Bob.

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