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Old 22-01-2005, 11:43   #79
waxwing
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I quite enjoyed reading the last few pages .. well some of it

I agree with those of you who are saying that we need to strike a balance between focus on the emotional and the intellectual component of trading a system.
Both elements must be important. But (was this already mentioned?) maybe the key point is the connection between the two. If you have a system defined entirely quantitatively (and therefore fully mechanizable and completely objective - any trader or any computer will trade it the same way) then the only thing between you and success is full confidence in that system. If you can demonstrate success over a very large historical timeframe of testing and, more importantly, understand the reasons for that success, then you can build that confidence. The more such confidence you have, the less you will be troubled emotionally by your P/L.
So I'm trying to say there's an inverse relationship - the more you understand, the less you panic.
And that's why I don't think it's just a matter of buying a system or downloading it off the 'net. If you have no idea what the system is really doing, then you'll always be fighting your emotions because you'll never have confidence that the market's character hasn't changed today and turned the system into a loser - in a totally opaque way.
A person who understands their own system will see it breaking down early, pull out and redesign - in an ideal world
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Da konechno slozhno - no yeshyo vozmozhno ...

Last edited by waxwing : 22-01-2005 at 11:46.
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