PositiveDev's trading journey

[Perishabull]

I feel that I'm at bit of an impasse with trading at the moment, I had intended to just take quite a short break from it after seeing the previous trading strategy wasn't suited to part-time trading. The plan was to have explored some new ideas by now, the break has turned out to be longer than I'd thought, I've had a few other things happening meantime, including a promotion.

 

Mrs PositiveDeviant goes to a guided meditation class and I went along on sunday out of curiosity and we were taught a visualisation technique to use to find an answer, so my question was concerning what I needed to do next regarding trading and during the visualisation the word "Apply" appeared inside a book on a table in front of me, we were told someone may appear sitting next to us at the table and speak or help in some way, and whilst someone appeared they didn't do or say anything at all. Afterwards this made sense since it's not someone else that needs to "apply". I took the lack of action by the person that appeared, combined with the word in front of me to be an implied message from them - Apply yourself.

 

I'll have a brainstorming session at some point soon, I'm sure that will give me some new directions for my trading.

 

I've also just recently started using something called Brain Workshop, a game based on scientific research. Recent scientific studies show that improvements can be made in fluid intelligence - the ability to creatively solve new problems. This is something quite new in science since it's been a long established "fact" that fluid intelligence is a fixed parameter that cannot be altered via training. The original study by Suzanne M Jaeggi - ;

 

(Here's a short extract)

 

 

"Improving fluid intelligence with training on working memory

• Susanne M. Jaeggi*,^†,^‡,
  
• Martin Buschkuehl*,^†,^‡,
  
• John Jonides*, and
  
• Walter J. Perrig^†
  

Abstract

Fluid intelligence (Gf) refers to the ability to reason and to solve new problems independently of previously acquired knowledge. Gf is critical for a wide variety of cognitive tasks, and it is considered one of the most important factors in learning. Moreover, Gf is closely related to professional and educational success, especially in complex and demanding environments. Although performance on tests of Gf can be improved through direct practice on the tests themselves, there is no evidence that training on any other regimen yields increased Gf in adults. Furthermore, there is a long history of research into cognitive training showing that, although performance on trained tasks can increase dramatically, transfer of this learning to other tasks remains poor. Here, we present evidence for transfer from training on a demanding working memory task to measures of Gf. This transfer results even though the trained task is entirely different from the intelligence test itself. Furthermore, we demonstrate that the extent of gain in intelligence critically depends on the amount of training: the more training, the more improvement in Gf. That is, the training effect is dosage-dependent. Thus, in contrast to many previous studies, we conclude that it is possible to improveGf without practicing the testing tasks themselves, opening a wide range of applications.

 

• 
  

Fluid intelligence (Gf) is a complex human ability that allows us to adapt our thinking to a new cognitive problem or situation (1). Gf is critical for a wide variety of cognitive tasks (2), and it is considered one of the most important factors in learning. Moreover, Gf is closely related to professional and educational success (3–6), especially in complex and demanding environments (7). There is considerable agreement that Gf is robust against influences of education and socialization, and it is commonly seen as having a strong hereditary component (2, 8, 9). Gf can be compromised as seen in the effects of certain manipulations that threaten one's group membership (10). But can Gf be improved by any means?""

 

 

 

 

Further info on dual n back training here http://www.gwern.net/DNB%20FAQ

 

I definitely feel that things are working better "upstairs" since I started the dual n back training. Although it's tough, it seems to be worth persevering with. Susanne Jaeggi, the principal author of the above paper features here;

 

 

One of the side effects is that I am dreaming A LOT more and I had a really fun lucid dream on Tuesday morning.

[Perishabull]

One of the side effects is that I am dreaming A LOT more and I had a really fun lucid dream on Tuesday morning.

 

 

Hmmm, seems like there could be some other side effects too, similar to what others have reported...

 

 

[Perishabull]

 

Have you tried listening to White Noise while trading?

 

 

Interesting

[drbubb]

My RV is "kicking ass" again this week: I'm batting 75%, 3X - 6X the random result.

 

The Viewings were done with White noise in the background, and a more precise technique

 

/see: http://www.greenenergyinvestors.com/index.php?showtopic=16686&st=40

[Perishabull]

For anyone more interested in the Dual N back study, you can try out the task it's based on here http://www.memory-im...k-training.html

[Perishabull]

Links between fluid intelligence and creative thought explored in the following paper;

 

http://scottbarrykau...lvia-Beaty-.pdf

 

 

a b s t r a c t

 

The relationship between intelligence and creativity remains controversial. The present research

explored this issue by studying the role of fluid intelligence (Gf) in the generation of

creative metaphors. Participants (n=132 young adults) completed six nonverbal tests of Gf

(primarily tests of inductive reasoning) and were then asked to create metaphors that described

a past emotional experience. The metaphors were rated for creative quality. Latent variable

models found that Gf explained approximately 24% of the variance in metaphor quality

(standardized beta=.49), consistent with the view that creative ideation engages executive

processes and abilities. The effect of Gf remained substantial after including personality (the

Big Five factors) in the model. The discussion considers implications for the debate over intelligence

and creativity as well as for the cognitive abilities involved in metaphor production.

© 2012 Elsevier Inc. All rights reserved.

[Perishabull]

Found an interesting website www.absolutereturns.com;

 

"Absolute Returns, founded in 2007, is an independent managed futures and alternative investment performance database for both individual investors and brokers. Managers report to our database directly.

 

You can look at various funds, CTA's etc, it's quite interesting looking at their historic equity curve and their disclosure docs that details the strategy employed.

 

 

 

Here's one that stands out;

 

 

 

The background of the manager also stands out;

 

"Sanford J. Grossman earned his B.A. in 1973, M.A. in 1974 and PhD in 1975, all in Economics, from the University of Chicago. Since receiving his doctorate, he has held academic appointments at Stanford University, the University of Chicago, Princeton University (as the John L. Weinberg Professor of Economics, 1985-89) and at the University of Pennsylvania's Wharton School of Business. At Wharton, Dr. Grossman held the position of Steinberg Trustee Professor of Finance from 1989 to 1999 (a title now held in Emeritus) and also served as the Director of the Wharton Center for Quantitative Finance (1994 - 1999).

 

In addition, Dr. Grossman was an Economist with the Board of Governors of the Federal Reserve System (1977-78), and was a Public Director of the Chicago Board of Trade (1992-96). In 1988, he was elected a Director, in 1992 served as Vice President, and in 1994 was President of the American Finance Association.

 

Dr. Grossman's research has spanned the analysis of information in securities markets, corporate structure, property rights, and optimal dynamic risk management. He has published widely in leading economic and business journals, including American Economic Review, Journal of Econometrics, Econometrica and Journal of Finance. His papers include "The Existence of Futures Markets, Noisy Rational Expectations and Information Externalities"; "On the Efficiency of Competitive Stock Markets Where Traders Have Diverse Information"; "On the Impossibility of Informationally Efficient Markets," with Joseph Stiglitz; "An Introduction to the Theory of Rational Expectations Under Asymmetric Information"; and "The Costs and Benefits of Ownership: A Theory of Vertical Integration," with Oliver Hart. Dr. Grossman's original contributions to economic research received official recognition when he was awarded the John Bates Clark Medal by the American Economic Association at its December 1987 annual meeting. The Q-Group awarded him first prize in The Roger F. Murray Prize competition for the paper "An Analysis of the Implications for Stock and Futures Price Volatility of Program Trading and Dynamic Hedging Strategies." The Editorial Board of the Financial Analysts Journal awarded him the 1988 Graham and Dodd Scroll for "Program Trading and Market Volatility: A Report on Interday Relationships." Dr. Grossman received a Mathematical Finance 1993 Best Paper Award for his article "Optimal Investment Strategies for Controlling Drawdowns." Dr. Grossman received the 1996 Leo Melamed Prize by the University of Chicago Graduate School of Business for outstanding scholarship by a professor. In 2002, Dr. Grossman was recognized by the University of Chicago with its Professional Achievement Citation. Most recently, he was awarded the 2009 CME Group-MSRI Prize in Innovative Quantitative Applications.

 

Currently, Dr. Grossman applies his rigorous scientific approach to improving and developing systematic investment strategies and risk controls for QFS."

 

 

 

$811 Mill assets under managemnt, minimum investment $250K. Counts me out.

[Perishabull]

It would appear Mrs PositiveDeviant may have had some recent fortune, on her travels she found a shop where she wanted to buy a frame, there was also a box with old coins in the shop, she tried to haggle for a better price for the frame, the shop owner wouldn't budge on price but said she could have one of the old coins from the box, she agreed with this, paid £10 for the frame and took a coin that caught her eye.

 

This is what she got;

 

 

 

I'll post on the gold thread to see if anyone can help with identification...

[Perishabull]

I've spent the last 9.5 hours trying to develop a different way to analyse securities, it's been a real slog. It may not be new (since you don't know what others are up to) but it certainly has to be at least 3 standard deviations away from the mean, the mean being the somewhat typically archaic methods that the mass market uses. Searches on Google turn a blank. What I'm try to do is find a way to exploit the human tendency to look at things in pairs, or in contrast to one another. It's a natural direction for people to take, in terms of their thinking and I'm sure that it must have left a gap in the market that can be exploited.

 

 

 

Some probably think this is not normal behaviour for a saturday, maybe I should be watching a group of men kick an inflated leather ball amongst themselves with the object of scoring a "goal" or perhaps swinging a club with the object of getting the ball in the hole, or playing with a cue with the object of getting the balls in the holes.

 

The truth is the financial markets are far more competitive than those silly games, and a whole lot more interesting.

[Perishabull]

[drbubb]

 

 

Does it fit together?

It seems not, to me

[halight]

 

 

 

 

Well done mate!

[John Doe]

 

 

That's smashing PD!

[Perishabull]

Thanks guys!

 

 

I recently met Captain Richard Frances Gordon, former NASA astronaut and one of only 24 people who have travelled to the moon. He was part of the Gemini 11 and Apollo 12 missions.

 

There he is, in the middle;

 

 

 

 

 

He gave an excellent talk, one I'm sure he's given many times over, and his final message was about risk. He explained that many people are afraid to take risks, discourage their children from taking risks etc but that is how people come to achieve great things, by taking risks, so his parting message was to parents of children, encourage them to take risks, as it's only by doing that, that we can achieve anything and it's ok to fail since sometimes you need to fail at something to learn enough to conquer it the next time. He did a spacewalk during his November 1969 mission but he failed at the task he'd been given, simply because they hadn't though of designing something to hold his feet to leave his hands free to carry out a task in space. Consequently he had to hold on with one hand and try and use the other to complete a 2 handed task! He referred to himself as a failure for that particular element but NASA learned from that for future missions and implemented new designs to account for these difficulties.

 

I found his talk quite inspiring, there was a big que at the end so that everyone could get a piece of him, either a picture or signature (or both!).

 

I just shook his hand, told him his talk was great, and thanked him.

 

The mission insignia;

 

 

Of course my wife wanted a picture with him, (I don't think she would appreciate me posting on a public forum so I've "amended" the picture).

 

Oh yes, Captain Richard Gordon liked my wife alright! Still an eye for the ladies at 83!

 

[Perishabull]

 

 

Does it fit together?

It seems not, to me

 

They are beach finds, they don't match up. I've also collected lots of blank ones, just white, I'm going to make a sculpture out of those by fitting them together. Not quite sure exactly what I'll do with them, I've never attempted any art before but I'll think of something, when the time is right.

[jerpy]

He gave an excellent talk, one I'm sure he's given many times over, and his final message was about risk. He explained that many people are afraid to take risks, discourage their children from taking risks etc but that is how people come to achieve great things, by taking risks, so his parting message was to parents of children, encourage them to take risks, as it's only by doing that, that we can achieve anything and it's ok to fail since sometimes you need to fail at something to learn enough to conquer it the next time.

Of course my wife wanted a picture with him, (I don't think she would appreciate me posting on a public forum so I've "amended" the picture).

 

 

Hi P.D ever read Robert Kiyosaki? He goes along similar lines from a tough-ish upbringing, albeit he didn't walk on the moon!

 

Have a bit of an issue with his Real Estate ideas at times, but the principles of teaching kids financial lessons early come through in some of his books aimed at kids, along with the game CashFlow for Kids he often plugs. Anyway the books were of interest to me, mainly because he has a good angle on how they educational system tries to condition kids against risk and conform i.m.o. Yet Robert explains encouraging them to take risks will reward them better in the future.

 

If you know this and I've bored you, apologies.

[halight]

Hi P.D ever read Robert Kiyosaki? He goes along similar lines from a tough-ish upbringing, albeit he didn't walk on the moon!

 

Have a bit of an issue with his Real Estate ideas at times, but the principles of teaching kids financial lessons early come through in some of his books aimed at kids, along with the game CashFlow for Kids he often plugs. Anyway the books were of interest to me, mainly because he has a good angle on how they educational system tries to condition kids against risk and conform i.m.o. Yet Robert explains encouraging them to take risks will reward them better in the future.

 

If you know this and I've bored you, apologies.

 

Iv read his too Rich dad poor dad books. I enjoyed them and I also agree with teaching our children financial education and also teaching them about Risk.

[Perishabull]

Thanks riggerbeautz, yes I have read Kiyosaki's rich dad poor dad, great book.

 

I'm exploring the idea of trading spreads right now, so for example long NASDAQ futures / short DOW futures, that sort of thing.

 

During my previous efforts trading there were a few things I picked up from watching the markets regularly, that I may be able to capitalise on.

 

Let's find out.

 

 

Clearly there are a different set of risks and opportunities compared to the type of trading I was previously engaged in so I'll need to study this for a while, probably once I've developed a basic strategy I will test it out on a simulated account first, to see how I get on. There are some attractive aspects, such as your position being hedged all the time, even if it's not a full hedge, and no stops would be involved, so the entry probably would not need to be so finessed as compared to my previous strategy (Strategy II), although I would probably still set emergency stops well wide of the market, just in case something adverse happened, certainly on the long leg of the spread anyway.

 

Here's one I made earlier - up so far.

 

 

E-MIni NASDAQ futures

E-mini Dow Futures

[Perishabull]

Ok well that was my first spread trade, and it worked very well, essentially I went long the NASDAQ, and short the Dow, making the equivalent of 10.25 NASDAQ points out of the spread. I usually count in points, rather than $ since it allows you to focus on process and results rather how much is made or lost.

 

 

NASDAQ / DOW spread trade (SIM)

[Perishabull]

Turns out that Mrs PositiveDeviant is going to be famous across the Middle East and North Africa...........................well at least for a few minutes anyway. Some of you may recall that she took part in a NASA project called Planethunters.org, and as a result found a new exo-planet. Due to this she has received some interest from journalists and whatnot, there was a documentary made about her and another scientist who found a planet using gravitational microlensing. Anyway that was a while ago, today a Saudi Arabian journalist for BBC Arabic, Aneesa Al Qudaihi came round our place, along with his cameraman to interview her for a technology show that apparently goes out to 25 million across the Middle East and North Africa, it called '4Tech'. It's about the technology behind Planethunters.org and the citizen scientist movement. I'd never heard about '4tech' until recently, but of course it's broadcast in Arabic. I would imagine it's probably similar to the BBC's western tech show called 'Click'. I'm sure many of you will have seen that, I sometimes catch it of a Saturday morning.

 

I had another engagement today so came home 30 mins too late to be able to meet him, a shame, he was talking with MrsPD about how he covered the Arab Spring, having travelled widely throughout the Middle East, the internal situation in Iran, Iran's relationship to Russia etc.

 

[drbubb]

Nice photo -

And a good experience to put in the memory bank

[Perishabull]

Hi folks, I am a little late in posting this but Jeff Quinto is holding a webinar regarding overcoming fear in trading over at www.BigMikeTrading.com. It's free to register and starts at 9.30pm tonight (ie 45 mins). The link takes you to the page to register.

 

http://www.professio...rmentoring.com/

 

If you are interested in trading futures you need to listen to this guy, he's very good, very sage advice and guidance. He also features on the CME group website. There are masses of charlatans when it comes to trading but this guy isn't one of them. The few things he said to me back a year ago really spurred me on and helped a lot. I had a mentoring session with Jeff about a year ago and recommended him to "Big Mike", seems like Big Mike finally got round to inviting him on...

 

PD

[drbubb]

Looks like the lady lost her head.

But that's okay, if she is shy

[Perishabull]

PARALLELS

 

I remember this time last year very well indeed. On the 5th November last year I was indoors back-testing a trading strategy, looking out the window I could see one of my neighbours, a law professor, was outside having some beers and a bonfire with some of his students, setting off fireworks etc.

 

That strategy was found wanting, it didn't work, I traded it, made a little but not enough to make it worthwhile. I find myself going through another process now, not dissimilar to last year, where I'm looking at potential new approaches to the market. It feels like I've come full circle but I'm now on a different parallel.

 

 

 

More recently I've been working on a new way to analyse prices, whether it be stocks, futures, currencies or whatever, it had been at the back of my mind for a long time, and I wasn't sure exactly how to execute it since, to my knowledge, it hadn't been done before and there's some maths involved, not really my strong suit. And I wasn't really sure whether anything would come of it, the only way to find out was to create it and start using it. Anyway recently I figured out how it could be done and over the last few days I finished the work, and started analysing using the new tool I've made. What I found was that it can display relationships between prices that may not be well known in the markets, at least outside hedge funds anyway. There's no way I'm likely to find out if it's already been done or if someone else is doing the same thing or whatever. That doesn't really matter anyway since unless I can capitalise on it then it is ultimately pointless. In fact probably a better way to describe it is a method of tracking where the value is actually moving to. The complex part is that even where I've found a defined relationship there are several different futures/currencies involved, so now I've actually found what appears to be a clear edge, coming up with a trading strategy that captures it, may not be easy. It was a complex to create this new tool, it may be even more complex to get something out of it.

 

But then earlier today something very curious happened, I suddenly realised that there is a completely different way I can trade, a totally peripheral idea to the one I've just spent all that time working on, and the first indications look quite positive. I've always thought that the best way to look at markets is from the side, and that seems to have been whats happened here. I've spent time creating something completely new, that I need to do more research on to see if I can use it to create profitable trades, and I now something completely different and interesting has come out of it.

 

It's an interesting journey, this path that I've taken, maybe today was a signal for me to take it to a new level, a new parallel.

[Perishabull]

A nicely executed spread trade earlier on (SIM). Long Nasdaq futures, short DJIA futures;

 

NASDAQ futures

DJIA futures

 

 

The NASDAQ leg was slightly down whereas the DJIA was down by quite a lot more, a well timed exit.

 

 

Gain on 10 points (SIM). I'll keep trading SIM until I'm at a point where it looks like the sort of propect I want to trade live.