Category: trading knowledge

One of the most important aspects of trading is the buy and exit prices. How do you enter and exit a trade? We all know commissions can eat into the

Almost all traders ignore survivorship bias, either on purpose or lack of knowledge. Why is it important to understand survivorship bias? It’s important because it overstates backtested results and leads

Brett Steenbarger is a famous trading psychologist who has written the bestseller The Psychology Of Trading. In the book, Steenbarger referred to personality traits that tend to distinguish good from

Anyone reasonably interested in trading and speculating has probably heard about Ed Seykota. He was first featured in Jack Schwager’s Market Wizards. It’s the most memorable interview in the whole

Proprietary trading might not be so different than retail trading. I was a proprietary trader from 2001 until 2018 in three different companies. How was it, and how does it

I have been a customer at Interactive Brokers for the last 11 years, and on and off many years prior to that. Not only have I been a profitable customer

Mankind has come a long way in problem solving and technical advancements, but most of us still suck when it comes to financial planning and managing our investments. We have

Edward Thorp is by many regarded as “the first quant”, at least one of the first who successfully used quantitative models for risk-taking. He became famous when he wrote the

If you have spent considerable time developing a strategy, it’s frustrating if it performs poorly in live trading. What is happening? Why does it perform so poorly when it worked

The first principle is that you must not fool yourself and you are the easiest person to fool. – Richard Feynman When your money is at risk, you easily get

Correlation, which measures the relationship between two datasets, is an essential variable for a trader. How your positions move in relation to other positions is crucial to understand and manage

Are you looking to start trading but are unsure what steps need to be taken? Or have you dipped your toes in the water but are struggling to find the

Quant trading, an abbreviation for quantitative/quantified trading, is growing in popularity because of the possibility of having the computer do all the work and reduce emotions and behavioral mistakes. This

Trading and investing are entirely different ballgames. Both have the same aims, to grow your wealth, but they have various time commitments, risk profiles, and outcomes. Trading has been around

There are many reasons why someone might like to become an automated trader. Freedom, independence, wealth, and scalability are a few reasons why someone starts trading, but we suspect the

Jim Simons recently stepped back as the chairman of Rennaissance Technologies, the asset management group that manages the most profitable fund ever: The Medallion Fund. Simons is the founder, biggest

Always inverse, says the famous investor Charlie Munger, Warren Buffet’s friend and business partner. What is inverse thinking? This is when we turn a problem on its head or look

Most traders focus on finding an edge in the market by developing good and robust trading strategies. But many neglect one other very important factor for good returns: understanding your

Yesterday, the 3rd of September 2020, witnessed a pretty big drop in the stock market with Nasdaq leading the decline with a drop of 5.07%. Out of interest, I looked

In a previous post, I wrote about a trader’s mindset. You have to battle the markets, of which you have no influence and control, but more importantly, you have to

Background: An EU/EEA regulation called MiFID requires brokers to categorize their clients as either “retail” or “professional” in order to determine the correct level of investor protection and transparency. MiFID

No matter how good strategies you have, they are most likely worthless if you can’t execute them properly. What looks like a piece of cake in a backtest, is completely

This article is off-topic, but in my opinion quite important: International regulators, led by the EU and the USA, are increasingly taking steps to clamp down on money laundering and

My previous post on how I screw up by second-guessing my strategies made me change my trading habits (for the better). I have taken two actions for my day trading:

Chapter 4 in Victor Niederhoffer’s book Education Of A Speculator starts like this: There are so many ways to lose, but so few ways to win. Perhaps the best way