http://trading-u.com/blog/2011/05/the-relationship-between-probability-and-trading/ Forex & Futures Trading Education Tue, 27 Mar 2012 21:07:30 +0000 hourly 1 http://wordpress.org/?v=3.1 http://trading-u.com/blog/2011/05/the-relationship-between-probability-and-trading/comment-page-1/#comment-731 Barry Huddleston Mon, 02 May 2011 21:42:47 +0000 http://trading-u.com/blog/?p=3363#comment-731 If what you believed wasn't true would you want someone to tell you? Having read Taleb's book I agree that there is the unknown that can interupt a perfect trading record. My record of 530 trades in a row over 14 month was broken because of something I didn't see coming. With the right system you can be 100% certain that a position will be in the money and profit can be taken, however many times the unknown element is the traders own stupidity. What they didn't see coming, they were not anticipating. They lost control. Risk has to be controlled and a good system will not only produce pips but it will also keep the trader out of bad trades and trades that don't have any chance of making a profit. My latest record of 310 positive trades in a row was broken, not because of the system, or unknown elements, or because of some statistical certainty. It was broken because probability doesn't take into account the human element of emotion. If what you believed wasn’t true would you want someone to tell you? Having read Taleb’s book I agree that there is the unknown that can interupt a perfect trading record. My record of 530 trades in a row over 14 month was broken because of something I didn’t see coming. With the right system you can be 100% certain that a position will be in the money and profit can be taken, however many times the unknown element is the traders own stupidity. What they didn’t see coming, they were not anticipating. They lost control. Risk has to be controlled and a good system will not only produce pips but it will also keep the trader out of bad trades and trades that don’t have any chance of making a profit. My latest record of 310 positive trades in a row was broken, not because of the system, or unknown elements, or because of some statistical certainty. It was broken because probability doesn’t take into account the human element of emotion.

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