Thank you for Lance for always bringing things back to a disciplined structure that you can live with in any market. Your commitment to give back to the trading community is greatly appreciated.
Appreciate the actionable content. After years of trading with mixed results, realizing I had no true strategy. Looking forward to seeing more on this topic. Thanks, Lance.
So glad to here this, because a lot of my trades are based on reading the tape and I can't always find a quantifiable reason I took the trade and so many people talking about rules based strategies has me doubting my edge from time to time.
Excellent topic and excellent advice! One of your colleagues on Chat with Traders, said that it’s not a requirement to understand what your edge is prior to trading the discovered anomaly. I would love to hear your opinion : how important is it to understand why the edge exists.
Good explanations. Glad you didn't fall into the trap of saying the same thing everyone else does. Being original and have your own system is more important
Most people talk about sticking with certain strategies but infact market keeps changing from time to time,the strategies that worked wonders for you last year may necessary not work this year and this is the challenging part about trading for beginners,that's why it really takes many years for a trader to really get a grip of the market and make consistent profits from it
Lance. I found a progressive strategy that works a lot when it works. It that makes sense. Depends on how the stock trades to provide enough set ups in a row. Your video here is literally priceless. One of the best I have seen. Now I know how to find a strat the right way. Thanks.
Lance, when you say the only way to truly tell if you have edge is over time, what do you consider to be a reasonable measurement period? I've heard people say 3 profitable months in a row. Any thoughts?
Great question!! Those people and above commenter sadly are incorrect. There is NO single right answer. IT ALL DEPENDS ON FREQUENCY OF TRADES AND EXPECTED WIN RATE OVER A CORRESPONDINGLY LONG ENOUGH AMOUNT OF TIME! 3 profitable months isn’t statistically significant if you made only 1-2 trades per month. Similarly, 20 trades isn’t meaningful if there is fat tail skew hidden there. Selling way OTM options for example, you are likely to win 20/20 times but could lose all your gains on the 21st. This all falls under the subject of confidence intervals in statistics. How confident are you that you have edge given the number of trades taken? The more trades taken over a longer period of time, the more you approach 100% confidence that you truly have edge. If you forced me to give an answer, I’d say that I want to see hundreds of trades to be 90% confident. But thousands of trades to be 99% confident. And tens of thousands of trades to be 99.9% certain. (Again, fat tail skew of the returns though likely determines the actual true answers)
Found my edge and still working out with emotions. Trading setups and analysis are spot on..i just take profits early and watch prices hit my TP and SL at a good ratio.
Hey Lance I trade futures and arbs between them. Your insight about edge is valuable and the only point I think is overlooked w/r/t day trading is scrambling. You don't talk about experienced traders hedging in real time and not just being in or out. Do you use e minis or qqq to get length when your short position is getting hit and getting out is very expensive? Maybe it's just a futures market tool! I have talked to Mike about this. Thanks for posting!
I would almost never hedge and was largely taking what I viewed to be idiosyncratic edge that ideally wasn’t too market dependent. Regardless, most hedges have a cost involved, and I largely would prefer to take higher variance unhedged and have it all wash in the long run without paying cost of hedging.
Good commentary. So the more multiple confirmations that can and do line up in the direction of your intended trade, the higher the probability of success. Thankyou for putting all these subtle nuances into words.
Thank you very very much again! This content is relieving, confirming and encouraging at the same time. You open so many different ways to develop sucessfuly and adaptive, which could fit to many types of personalities with different educational backgrounds. There is so much value both in this and the previous 101. I´m sure it added clarity to many viewer´s personal process in a huge way - for me it did to better understand what I´m actually doing or trying to do and why to stick with it. It is encouraging to hear that experience, intuition gained from this experience and pattern recognition are real things to achieve with the proper work put in. Inspired by your last video from then on I consequently searched trades with individual or sector-based catalysts, but also looked that meet my technical criteria, which I developed by a combination of mimicing, studying and applying in my trading. Most of the candidates really moved and showed good opportunities. I would appreciate it very much, if you could give us an example of a trade with well processed news stacked with a set of technical criteria matching to it. Thanks again!
Do video reading tape live streaming and explain how and why you hold or sell positions based on tape reading. Sometimes we see too much red on tape seems like selling off but stock keeps going higher, how to identify the sellers are coming? Suck quick decision to make! never easy.
Great material and many thanks to Lance B and SMB. Could you do a video on how you determine an Inflection Point and general trading ideas? Much thanks
Can you explain why it would be possible for the market to ever allow a retail trader to have a sustainable edge? In times of AI / algos, if there was a sustainable edge sitting out somewhere, wouldn't it be discovered and gobbled up pretty quickly? For example, HFT firms employing physics PhD's go to the trouble of building warehouses that are physically closer to the exchange because the bottleneck is literally the speed of light. One could say, well that's different, they are playing a different game. But money is money, why would a firm engaged in that type of activity be forgoing the low-hanging fruit of grabbing a relatively easy-to-discover edge, and instead go all the way to the tippy-top of the tree at tremendous cost?
Some edges are too small for the whales. Some edges require human judgement. Some edges require thousands of hours of experience. Some edges can’t easily be programmed.
Really good video, thanks Lance and SMB! Would like it as big playlist covering nuances like actual examples of trades of certain edge in one specific market conditions, then how it changed/diminished due to changing market or people catching on it. Some estimates of minimum time period till we know if we have an edge(unless it's very obvious structural edge)
From a separate reply: Great question!! Those people and above commenter sadly are incorrect. There is NO single right answer. IT ALL DEPENDS ON FREQUENCY OF TRADES AND EXPECTED WIN RATE OVER A CORRESPONDINGLY LONG ENOUGH AMOUNT OF TIME! 3 profitable months isn’t statistically significant if you made only 1-2 trades per month. Similarly, 20 trades isn’t meaningful if there is fat tail skew hidden there. Selling way OTM options for example, you are likely to win 20/20 times but could lose all your gains on the 21st. This all falls under the subject of confidence intervals in statistics. How confident are you that you have edge given the number of trades taken? The more trades taken over a longer period of time, the more you approach 100% confidence that you truly have edge. If you forced me to give an answer, I’d say that I want to see hundreds of trades to be 90% confident. But thousands of trades to be 99% confident. And tens of thousands of trades to be 99.9% certain. (Again, fat tail skew of the returns though likely determines the actual true answers)
@@TheOneLanceB great analogy with options example. I am following methods taught by you and SMB for my intraday trading. Noting down my stats and expectancy. I understood now that I need lot of trials(trades) to converge at my expectancy. Will try and continue on it. Thanks again!
Why all the videos on this channel mostly winning trades, where’s the loses? Are you guys keep beating the market all the time? Seems like loses are not part of your content. A real trader post their loses to. Not sugar coating everything. Be real..
I watched 90%smb videos, that is my Edge! My mindset is trained to observe the stock in a systematic way.
Thank you for Lance for always bringing things back to a disciplined structure that you can live with in any market. Your commitment to give back to the trading community is greatly appreciated.
🙏
thank you.... SMB is the gold standard for trader training
Thank you Lance, after 5 years of trading I find all of your materials helpful. Please keep up the giving back as you offer so much knowledge..
🙏
Thank you Lance. Your videos always shows the gulf between where retail traders are vs prop traders.
Appreciate the actionable content. After years of trading with mixed results, realizing I had no true strategy. Looking forward to seeing more on this topic. Thanks, Lance.
Thank you Lance and Bella for the in-depth video.
So glad to here this, because a lot of my trades are based on reading the tape and I can't always find a quantifiable reason I took the trade and so many people talking about rules based strategies has me doubting my edge from time to time.
Excellent topic and excellent advice! One of your colleagues on Chat with Traders, said that it’s not a requirement to understand what your edge is prior to trading the discovered anomaly. I would love to hear your opinion : how important is it to understand why the edge exists.
Can I ask what is typical % profit per day and per trade? Thanks
Good explanations. Glad you didn't fall into the trap of saying the same thing everyone else does. Being original and have your own system is more important
Most people talk about sticking with certain strategies but infact market keeps changing from time to time,the strategies that worked wonders for you last year may necessary not work this year and this is the challenging part about trading for beginners,that's why it really takes many years for a trader to really get a grip of the market and make consistent profits from it
Lance. I found a progressive strategy that works a lot when it works. It that makes sense. Depends on how the stock trades to provide enough set ups in a row. Your video here is literally priceless. One of the best I have seen. Now I know how to find a strat the right way. Thanks.
Lance, when you say the only way to truly tell if you have edge is over time, what do you consider to be a reasonable measurement period? I've heard people say 3 profitable months in a row. Any thoughts?
I've never heard a timeframe as a criteria, just a number of trades, which is 20 trades.
Great question!! Those people and above commenter sadly are incorrect.
There is NO single right answer.
IT ALL DEPENDS ON FREQUENCY OF TRADES AND EXPECTED WIN RATE OVER A CORRESPONDINGLY LONG ENOUGH AMOUNT OF TIME!
3 profitable months isn’t statistically significant if you made only 1-2 trades per month.
Similarly, 20 trades isn’t meaningful if there is fat tail skew hidden there. Selling way OTM options for example, you are likely to win 20/20 times but could lose all your gains on the 21st.
This all falls under the subject of confidence intervals in statistics. How confident are you that you have edge given the number of trades taken?
The more trades taken over a longer period of time, the more you approach 100% confidence that you truly have edge.
If you forced me to give an answer, I’d say that I want to see hundreds of trades to be 90% confident. But thousands of trades to be 99% confident. And tens of thousands of trades to be 99.9% certain. (Again, fat tail skew of the returns though likely determines the actual true answers)
Yes keep these coming. Narrowing my focus on stocks in play has helped me improve so much! Thanks
Found my edge and still working out with emotions. Trading setups and analysis are spot on..i just take profits early and watch prices hit my TP and SL at a good ratio.
Hey Lance I trade futures and arbs between them. Your insight about edge is valuable and the only point I think is overlooked w/r/t day trading is scrambling. You don't talk about experienced traders hedging in real time and not just being in or out. Do you use e minis or qqq to get length when your short position is getting hit and getting out is very expensive? Maybe it's just a futures market tool! I have talked to Mike about this. Thanks for posting!
I would almost never hedge and was largely taking what I viewed to be idiosyncratic edge that ideally wasn’t too market dependent.
Regardless, most hedges have a cost involved, and I largely would prefer to take higher variance unhedged and have it all wash in the long run without paying cost of hedging.
This is a great video again. Reading one good trade as well. The content is solid from SMB.
Can you make these slides available for download, please?
Thank you Lance and SMB!!👌👌
Good commentary. So the more multiple confirmations that can and do line up in the direction of your intended trade, the higher the probability of success. Thankyou for putting all these subtle nuances into words.
As I'm finally getting into profitability, it's nice to have my biases confirmed by the information in your final slide. 🙃
What is the percentage return on capital that SMB considers for a successful trader?
Looking forward for the next one on this topic. Thank you Lance!
Thank you very very much again! This content is relieving, confirming and encouraging at the same time. You open so many different ways to develop sucessfuly and adaptive, which could fit to many types of personalities with different educational backgrounds. There is so much value both in this and the previous 101. I´m sure it added clarity to many viewer´s personal process in a huge way - for me it did to better understand what I´m actually doing or trying to do and why to stick with it. It is encouraging to hear that experience, intuition gained from this experience and pattern recognition are real things to achieve with the proper work put in.
Inspired by your last video from then on I consequently searched trades with individual or sector-based catalysts, but also looked that meet my technical criteria, which I developed by a combination of mimicing, studying and applying in my trading. Most of the candidates really moved and showed good opportunities.
I would appreciate it very much, if you could give us an example of a trade with well processed news stacked with a set of technical criteria matching to it.
Thanks again!
as always, thanks for this SMB!
Thanks
Thanks Lance, we appreciate the info!
Do video reading tape live streaming and explain how and why you hold or sell positions based on tape reading. Sometimes we see too much red on tape seems like selling off but stock keeps going higher, how to identify the sellers are coming? Suck quick decision to make! never easy.
Nice vid. Appreciate the honesty!
Great video Lance, thank you for sharing your infinite trading wisdom. 👍
Thanks for posting!!
Great material and many thanks to Lance B and SMB.
Could you do a video on how you determine an Inflection Point and general trading ideas?
Much thanks
Great information. Thanks for sharing this.
Well played sir. Once again this is THE best content for trading on the internet. And it is free. I thank you and good luck !
Thank you 🙏
Thanks for the video! Super helpful
thank you lance!
Keep up the great information
Thanks again Lance!
Thank you so much for sharing this
Do you have a good tape reading instruction video?
Might make at some point. Highly requested topic. Ty!
where is the 101 pre-rec video located at?
Great video Lance, thanks, reading the tape whatever you trade is key.
Thanks so much for these vids!
What I would give for an hour of training from you! Bro you are so bad a$$. Thank you for all your hard work and information from these videos. 🙏🏼🙏🏼
Great Advice by Lance again!! Thank you for sharing all the awesome information you give from all the hard work and experience you have
Good video. Thanks lance. But tape reading only 10% of your edge? Mine is at least 80% based on tape
Goes to show that everyone should have their own unique edge and should trade in the style that works for them.
Varies by trader! I know traders that are 100% tape. Many 0%!
brilliant video
Yes make more like these. To the weeds...ONE GOOD TRADE!
Excellent video and very well explained.
Thank you for the videos!
Good day do you guy have anything on Forex trading?
Great content! I appreciate you sharing this valuable information with us.
Thank you Lance : ) : )
Thank you for watching
Very informative. Thank you
Great video
what's a "NAV"?
Another good video
Thank you!
great video..💯
GOAT stuff
wow another gem
Thx for watching :)
Can you explain why it would be possible for the market to ever allow a retail trader to have a sustainable edge? In times of AI / algos, if there was a sustainable edge sitting out somewhere, wouldn't it be discovered and gobbled up pretty quickly? For example, HFT firms employing physics PhD's go to the trouble of building warehouses that are physically closer to the exchange because the bottleneck is literally the speed of light. One could say, well that's different, they are playing a different game. But money is money, why would a firm engaged in that type of activity be forgoing the low-hanging fruit of grabbing a relatively easy-to-discover edge, and instead go all the way to the tippy-top of the tree at tremendous cost?
Some edges are too small for the whales. Some edges require human judgement. Some edges require thousands of hours of experience. Some edges can’t easily be programmed.
Really good video, thanks Lance and SMB! Would like it as big playlist covering nuances like actual examples of trades of certain edge in one specific market conditions, then how it changed/diminished due to changing market or people catching on it. Some estimates of minimum time period till we know if we have an edge(unless it's very obvious structural edge)
From a separate reply:
Great question!! Those people and above commenter sadly are incorrect.
There is NO single right answer.
IT ALL DEPENDS ON FREQUENCY OF TRADES AND EXPECTED WIN RATE OVER A CORRESPONDINGLY LONG ENOUGH AMOUNT OF TIME!
3 profitable months isn’t statistically significant if you made only 1-2 trades per month.
Similarly, 20 trades isn’t meaningful if there is fat tail skew hidden there. Selling way OTM options for example, you are likely to win 20/20 times but could lose all your gains on the 21st.
This all falls under the subject of confidence intervals in statistics. How confident are you that you have edge given the number of trades taken?
The more trades taken over a longer period of time, the more you approach 100% confidence that you truly have edge.
If you forced me to give an answer, I’d say that I want to see hundreds of trades to be 90% confident. But thousands of trades to be 99% confident. And tens of thousands of trades to be 99.9% certain. (Again, fat tail skew of the returns though likely determines the actual true answers)
@@TheOneLanceB great analogy with options example. I am following methods taught by you and SMB for my intraday trading. Noting down my stats and expectancy. I understood now that I need lot of trials(trades) to converge at my expectancy. Will try and continue on it. Thanks again!
Hi does this work on forex?
It was good Lance
Nice
Lance thank you for your efforts…. 😅
Can you just tell us what setups you like and discuss that rather than discussing peripheral topics?
Hey lance, why, despite our immense focus on sleep, do your eyebags look like hamburgers?
Bc you are what you eat.
Why all the videos on this channel mostly winning trades, where’s the loses? Are you guys keep beating the market all the time? Seems like loses are not part of your content. A real trader post their loses to. Not sugar coating everything. Be real..