Territory of probability - page 9
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The "randomness"/"non-randomness" of this or that as applied to probability theory makes me shudder every time.
Gentlemen, everything in probability theory is always random! It does not consider the world to be other than random. And the area of TV's raison d'être lies in the "laziness" of making precise measurements. It's when you don't want to take them that probability theory APPLIES. One can calculate the landing point of a lunar module on the Moon with the help of TV, but one cannot do so because one needs to know the exact (with a given error, which is also calculated using TV) place of landing. Let's say to the third decimal place. The accuracy specified is defined by necessity of reduction of labour input into calculations and applicability of the obtained value.
In general, everything in the world is not random, to the limit of quantum dimensions - it is about 15 cm.
The "randomness"/"non-randomness" argument makes me cringe every time when it comes to probability theory.
Gentlemen, everything in probability theory is always random! It does not consider the world to be other than random. And the area of TV's raison d'être lies in the "laziness" of making precise measurements. It's when you don't want to take them that probability theory APPLIES. One can calculate the landing point of a lunar module on the Moon with the help of TV, but one cannot do it as one needs to know the exact (with a given error, which is also calculated using TV) place of landing. Let's say to the third decimal place. The accuracy specified is defined by necessity of reduction of labour input into calculations and applicability of the obtained value.
In general, everything in the world is not random, up to the limit of quantum dimensions - it is about 15 cm.
Why is 0.5 considered for equal stops? Probably because"the probability of a stop or a take being triggered is PROPORARY to their size"?
But the probability of a quote falling below zero is also zero (imagine a hypothetical stop-loss of tens of thousands of points) In connection with this fact, what should we do with this level? Should we correct it or ignore it due to its insignificant influence?
Why is 0.5 considered for equal stops? Probably because"the probability of a stop or a take being triggered is PROPORARY to their size"?
But the probability of a security price being below zero is also zero (imagine for a second a hypothetical stop of tens of thousands of points) Because of this fact, what should we do with this level? Should we correct it or ignore it due to its insignificant influence?
It is indeed an interesting point, with a long position and stops of several thousand pips, the IR is greater than zero, and you can't argue with that
Just because the price doesn't go below zero doesn't mean it's positive MO. You bought at a price of 1,000. After 10 years, the price became 50. The price has not dropped below zero, but your IR is negative at -950.
Why is 0.5 considered for equal stops? Probably because"the probability of a stop or a take being triggered is PROPORARY to their size"?
But the probability that a quote will fall below zero is also zero (imagine for a second the hypothetical tens of thousands of points) In connection with this fact, what to do with this level? Should we correct it or ignore it due to its insignificant influence?
Practice says otherwise. My average profit is, on average, 2 times the average loss. While the ratio of profitable trades to losing trades is 45/55.
In general, the stop/stack ratio is equal to (probability of loss)/(probability of profit).
All these mantras are caused by the delusion that the market is random. Yes, indeed the probability of the next change up or down tends to 50/50, but because the tick is usually no bigger than the spread, this micro world is not suitable for earning by classical TA methods. The only thing that works there is insider trading based on delays in information for different participants. If we analyse, say, the last 200 candlesticks, and in the case of a signal we are in an hours/days position. The human psychology is working there, and it is inertial and subject to the herd effect, which allows us to see stable trends.
If I buy for 1000, then after 10 years the price may be 3000, or even less than 1000 - but not less than 0. I still believe that the probability of winning under such ideal conditions and time=infinity is theoretically greater than the probability of losing. You can only lose 1000 and win 3000 or more. In fact, who cares, it has nothing to do with reality anyway.
It's a lot easier to go from 1,000 to zero than from 1,000 to 3,000 or 10,000.
Rugged perl...