The Holy Grail of Trading

In this video Stuart McPhee talks about the search for the holy grail of trading. Most people are searching the holy grail of trading, they think that they are going to find the answer and all their dreams will come true. Back in 1999 he was trying the going back system, which was testing all kinds of different of combinations. It takes only half an hour to develop everything you need to develop to trade well for the rest of your life. He believes that back then he was looking for that holy grail because he thought it cannot be that difficult.

Stuart says that you don’t need to go to search it because this concept does not exists, never has and never will. Everybody goes for that holy grail, you cannot say to someone not to go for it because there is a period in everyone's life when he will search for holy grail. When you are in this period, at least do not try to really over optimize your system because the more you optimized the system based on historical events the less effective it was in the future. Historically speaking, it should return very good results, but the more you try to optimize something in your mind it gets less effective than you can imagine.

Traders and investors have always dreamed of magical formulas or Holy Grails enabling them to beat the market and reap huge profits. Pursuing Holy Grails only ends in disaster. For example, among the garbage you will find out there: black boxes or secretive computer systems where the rules are hidden. Black box systems lose in the real world. They are useless. The absolute key is a proper overall education. Try to stay clear from the idea of trying to over optimize a system. The benefit of back-testing is that you can back test a system and get some new results to go. This is a profitable system, so when you trade through this system you can take some variables to look at and re-think your strategy.

Stuart McPhee quotes from this video:

  • Trading is like any other profession. You need to learn the basics, then develop and hone your skills through application. You are only going to succeed if you commit yourself to the task, as the only thing stopping you being highly profitable is yourself!
Submitted by YouTube Trader on Fri, 04/09/2010 - 21:03

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