Do you need the names of financial instruments to fully analyse and trade? - page 2
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It seems to me that a trader who only works "according to the schedule" is deliberately depriving himself of a lot of valuable information. There is already an abundance of information in the market, to put it bluntly.
The news, for example, has a strong influence - no one is likely to argue with that.
The author puts the question correctly.
"Will your analysis become difficult? For example, those who are used to trading EURUSD will not find that name. Which financial instrument would they choose to trade?"
I.e., what are the reasons to trade this or that instrument other than subjective ones? There is a sea of dates, why and how would a speculator choose an instrument, if he does not see the label of the subject of trade?
Some fundamental properties of an instrument are not calculated every time by the trading algorithm, but are taken into account when developing the algorithm.
And there is no way to recognise them at a glance. If you make a traded instrument unavailable, it will take me a long time to get used to the others.
What do the names of financial instruments (other than FAs) give you that their price history cannot? -Nothing! And here is why:
For example, if you know the names EURUSD, GBPUSD and EURGBP you know that these symbols are linearly related: log(EURUSD) - log(GBPUSD) = log(EURGBP). There is no more information about these symbols.
Can we find financial instruments that are linearly related, if their names are not known? Sure, you can, it is very easy.
So, the information contained in the names of financial instruments is fully contained in their history. In other words, the names are not necessary at all.
Is it possible to find majors among unnamed financial instruments? Of course you can, and again it is elementary. Since the majors are a non-permanent linear relationship between each other.
Recycle does all this easily. The example in its description where a cross is added to the majors is illustrative in this regard.
You don't need the names of financial instruments at all to trade a portfolio. Portfolio construction is a purely mathematical task that does not take into account time series names in any way.
If one trades GBPJPY using its high volatility feature. He didn't get the property of high volatility from the name. He simply measured it (consciously or not). You can measure volatility on all unnamed financial instruments and find your volatile GBPJPY. What is more, you can synthesize a super volatile financial instrument from unnamed instruments and trade it much better than "GBPJPY".
In general, do your maternal research on all financial instruments at once. And choose the right one based on the research, not based on the names.
What do the names of financial instruments (other than FAs) give you that their price history cannot? -Nothing! And here is why:
For example, if you know the names EURUSD, GBPUSD and EURGBP you know that these symbols are linearly related: log(EURUSD) - log(GBPUSD) = log(EURGBP). There is no more information about these symbols.
Can we find financial instruments that are linearly related, if their names are not known? Sure, you can, it is very easy.
So, the information contained in the names of financial instruments is fully contained in their history. In other words, the names are not necessary at all.
Is it possible to find majors among unnamed financial instruments? Of course you can, and again it is elementary. Since the majors are a non-permanent linear relationship between each other.
Recycle does all this easily. The example in its description where a cross is added to the majors is illustrative in this regard.
You don't need the names of financial instruments at all to trade a portfolio. Portfolio construction is a purely mathematical task that does not take into account time series names in any way.
If one trades GBPJPY using its high volatility feature. He didn't get the property of high volatility from the name. He simply measured it (consciously or not). You can measure volatility on all unnamed financial instruments and find your volatile GBPJPY. What is more, you can synthesize a super volatile financial instrument from unnamed instruments and trade it much better than "GBPJPY".
In general, do your maternal research on all financial instruments at once. And choose an appropriate one based on studies, not based on names.
And I was thinking, what is the purpose of the open subject? Turns out to be an advertisement for the banal removal of tonsils through the anus.....
Question to the author: would you write some sort of script that would overwrite the instrument names from the broker. I think a lot of people would love to switch to your Recycle.....
And I was wondering what the point of an open thread was? Turns out to be an advertisement for the trivial removal of tonsils through the anus.....
Question to the author: would you write some sort of script to overwrite the names of the instruments from the broker. I think a lot of people would love to switch to your Recycle.....
Your comment is unfortunately dictated only by personal animosity. Not suffering emotion to the detriment of common sense:
I have not been able to find a toolkit to at least find linear relationships between many fintechs at once. Perhaps I was not searching very well. I ended up implementing it myself.
The meaning is not in the implementation, but in the idea of finding a linear relationship in the market and the possibility of its realization.
What the tool names give us is the declaration of some linear relationship between some financial instruments. No more than that. There is a simple method of finding such relationships simply based on the history of quotes. You can find linear correlations not only in FOREX but also in other markets. You can find linear correlations on any BPs at all.
For example, if you have 10 different TRs. You can run them in the tester and get 10 BP changes of Equity. Then analyze these 10 TP for linear relationship. And on the basis of the analysis talk about the degree of independence of one TS from another. You can optimally distribute the balance between 10 TS on the basis of quantitative characteristics of relations, to trade them simultaneously.
Moreover, the topic is created not for the analysis of linear relations, but for understanding the necessity of studying all available financial instruments. And make preferences based on research, not on popularity or a nice name.
For example, many traders use GBPJPY for breakout of channels, because this pair is popular for this kind of trading. But the reasons of this type of trading lies not in its popularity, but in its high volatility. If we investigated the volatility of available instruments. It would be found out that SILVER is much more volatile than any other FOREX instruments. GBPJPY itself is not the most volatile of FOREX. Accordingly, the results of trading channel breakout strategies on SILVER would be much better.
I do not encourage to do it my way. Or use my CodeBase tricks, I don't need it. Just think about whether you have used all the features and why you are doing it this way and not that way.
hrenfx:
...you have to research all the financial instruments available. And make preferences based on research rather than popularity or a pretty name.
For example, many traders use GBPJPY to breakout channels, because this pair is popular for this kind of trading. But the reasons of this type of trading lies not in its popularity, but in its high volatility. If we investigated the volatility of available instruments. It would be found out that SILVER is much more volatile than other FOREX instruments. GBPJPY is not the most volatile of FOREX instruments. Consequently, the results of trading strategies of breakout channels on SILVER would be much better.
... Just think if you have used all possibilities, and why you have done it this way.
Seconded!
The topic is provocative, but the manifesto is correct!
+5!
;)
Your comment is unfortunately motivated only by personal animosity. (- don't be silly...) Not suffering from emotion to the detriment of common sense:
I have not been able to find a toolkit to at least find linear correlations between many fin. instrumens at once. Perhaps I was not looking very hard. I ended up implementing it myself.
The meaning is not in the implementation, but in the idea of finding a linear relationship in the market and the possibility of its realization.
What the tool names give us is the declaration of some linear relationship between some financial instruments. No more than that. (- what does "declaration" mean? There are real correlations between certain categories of instruments; I cited them in your previous thread, I won't repeat them.... These dependencies are based on the very nature of these tools.....) There is a simple method for finding such correlations simply based on the history of quotes. You can find linear correlations not only in FOREX, but also in other markets. You can find linear relationships in general on any BP. (It is necessary to have a logical relationship between instruments in order to use correlations.... If I find a correlation close to 1 between the rate of 10-y_T-b and the amount of beer drunk by my alcoholic neighbour, it does not mean that there is a correlation,... there is a coincidence, but no more than that; if you think you can trade on such coincidences,....???? - TS "Trading by Odds")
For example, if you have 10 different TS. You can run them in the tester and get 10 BPs of changes in Equity. Then analyze these 10 TP on the linear relationship. And on the basis of the analysis talk about the degree of independence of one TS from another. You can optimally distribute the balance between 10 TS on the basis of quantitative characteristics of relations, to trade them simultaneously. (Is this an allusion to the fact that besides optimization by history you may include optimization by parallel instruments?)
Moreover, the theme was created not to analyze linear relationships, but to understand that we have to study all available financial instruments. And make preferences on the basis of research, not on the basis of popularity or a beautiful name.
For example, many traders use GBPJPY for breakout of channels, because this pair is popular for this kind of trading. But the reasons of this type of trading lies not in its popularity, but in its high volatility. If we investigated the volatility of available instruments. It would be found out that SILVER is much more volatile than any other FOREX instruments. GBPJPY is not the most volatile of FOREX instruments. Accordingly, the trading results of channel breakout strategies on SILVER would be much better. (So you think that those who need the most volatile instruments have not thought to study the volatility of silver? Or maybe they are suckers?)
I'm not encouraging you to do as I do. (Tell me how you do.... Not in the form of abstruse theories, but in a simple way...) Or use my CodeBase stuff, I don't need it. Just think, have you used all possibilities and why you do it this way and not that way.
When one talks about the AUDUSD and GOLD rate correlations as logical (not mathematical) - Australia being one of the largest gold producers, this logic is all at the FA level. This logical relationship is interpreted subjectively in trading. You can simply either agree with it or not. That is why it is subjective. When they talk about mathematical correlations, it is objective. Relationships can be different. Correlation is one of the tools (not ideal) to find such relations. When it is spoken about false correlations it is difficult for me to quote better from the wikipedia:
Не являясь доказательством причинно-следственной взаимосвязи, корреляция тем не менее может служить инструментом для выдвижения гипотез о наличии такой взаимосвязи. Ложные корреляции тоже могут быть полезны в процессе исследований, заставляя искать «общую причину» хорошо коррелированных явлений. Наконец, сама статистическая зависимость, даже не являясь причинно-следственной, может быть полезной. Так, первый предутренний восход Сириуса позволяет с хорошей точностью предсказать разлив Нила (что может быть ценным для сельского хозяйства), хотя и не является причиной этого разлива.
When one talks about the AUDUSD and GOLD rate correlations as being logical (not mathematical) - Australia is one of the biggest gold miners, that logic is all at the FA level. (- What are you talking about...? How much of Australia's GDP is gold mining? What would happen if Australia dumped all its gold reserves on the market? Gold will go down - investors will start getting rid of gold - they will start investing in funds (including US funds as the largest) - funds will start appreciating - the dollar will start appreciating - resources imported into Australia will start appreciating - Australia's trade balance will be balanced by inflows of dollars from selling gold and outflows from buying expensive resources - the Australian at least can maintain parity.... So AU has not changed, G has fallen; what is the relationship?) Such a logical relationship is interpreted subjectively in trade. You can simply either agree with it or not. That is why it is subjective. (- It's not a question of subjectivity.... They are all objective processes; the only thing to consider is that the value of any asset is affected by dozens of factors, both long term and momentary. And these factors can simultaneously push the value of the asset in opposite directions; it is the job of analytical departments of investment funds and banks to isolate the impact of all these factors, i.e. what is commonly referred to as FA) When they talk about mathematical relationships, it is objective. (- If in roulette, if black gets out 70 times out of a hundred times, does it mean that betting on black is a guarantee of a successful game? No, because in the next hundred times black may fall only 20 times... If we find parameters showing good results on the history, it does not mean that these parameters will be profitable in the future. If we find that on history, 80% of the time, the Norwegian krone's rise has followed a fall in the corn futures, it doesn't mean that in the future, 90% of the time, the Norwegian's rise will coincide with the corn's rise......Why? Because there is no meaningful real correlation between Norwegian and corn.....) Correlations come in many forms. And correlation is one tool (not perfect) for finding such relationships. When it comes to pseudocorrelations, better than a quote from wikipedia is hard for me to cite:
(Sirius rising is a temporal factor. Sirius is not the cause of the Nile spill, but it shows the time when the spill should happen...)