BC TRADING
Saved by @CodyyyGardner

Are you planning on handing over your money to an algo trading platform?

Maybe you want to subscribe to a strategy or two and make insane returns.

Here's why you shouldn't do it, and save your money instead.

 1/ Maybe you want to have a strategy development company deploy such algorithms on your account with respective brokers.

Or the service itself has strategies that you just subscribe to and authorize your trading account with, and it will automatically trade your money.
2/ When it comes to @Tradetron1 there are a slew of issues.

Let's keep aside the lack of transparency and the total regulatory non-compliance for a moment.

First off, with most of the strategies, the backtests are BOGUS.
3/ Any systematic trader with even a little bit of experience will look at the strategies and tell you which ones are baloney.

Most of them are.

Don't take my word for it. Do your own due diligence.

And, those backtests aren't even for 10+ yrs. Some were done only for months.
4/ Secondly, SEBI has put rules in place on parameters like

- minimum net worth of the company
- qualifications of the fund manager
- minimum number of clients
- minimum amount to start with

and so on, for qualifying people who want to manage other people's money.
5/ There are only 3 structures offered by SEBI where people can manage other people's money.

- Mutual Funds
- Portfolio Management Service (PMS)
- Alternative Investment Funds (AIF)
6/ If the company/person you hand over money to don't have one of these licenses, you're essentially stepping into the grey area.

There's no LEGAL way to manage other people's money outside of these three structures offered by SEBI.
7/ There are few other ways in which you can manage other people's money.

Most popular one:

- Become a sub broker to a large broker
- Get terminal access
- Add clients
- Place trades for all your clients together
8/ In this method, you can open/close/modify orders in clients' accounts. You can't touch their funds.

To do this, you should

- Enter into an agreement with the client that you will be investing/trading their account
- Have an Associated Persons SEBI license
9/ You should also take client's approval for EVERY SINGLE TRADE YOU PUT ON and for EVERY SINGLE TRADE YOU CLOSE.

Even if you don't take permission for one trade also, that's considered fraud.

But that's how most people operate.
10/ Some get clients to automate email approval for each trade.

This is not entirely legal and won't be valid if push comes to stove.

Phone call recording + non-automated emails should be legal.

But nobody does that.
11/ Essentially, since nobody follows the letter of the law/SEBI, they are all taking unauthorized trades as every trade requires authorization.

This again, is the most popular way with which people who have capital of < 25c operate.
12/ Also, when you're a MF, PMS, AIF, there are so many things you CAN and CAN'T do.

There are things you should do regularly in terms of reporting.

You will definitely need a well-qualified compliance officer also.

Small guys aren't ready to invest in all this overhead.
13/ What can small guys do LEGALLY then?

RIA - Registered Investment Advisor.

It's usually a fixed fee format (although there are some who get a % profit based on agreement).

You take the trades on your own.

Usually does well for long term investing & positional trading.
14/ But, even RIA has a lot of regulations, you need to get the certification and proper licensing done.

There are certain limitations as to what an RIA can and can not do.

So many RIAs breach those rules too and act in a grey area.
15/ Now, coming to Tradetron and similar services, ask these questions:

i) Are their strategy creators SEBI registered?
ii) Is the company's entire modus operandi legal?
iii) How are their backtests vetted?
iv) Are the backtests vetted and verified or anyone can post anything?
16/ Ask these additional questions too.

i) What are the underlying technical issues people face? (Lots of people have faced execution issues, slippages, etc.)

ii) How are the backtests conducted? (full test, out of sample, walk forward, and then monte-carlo, etc., is required)
17/ You'll most likely draw a blank from all of them.

For some reason (valid one) I can't see a SEBI registration number on the websites of TradeTron or similar services.

One step further, Tradetron buries this information in their "terms of use" page.
18/ The screenshot above says you have to do your own due diligence on whether the person creating the strategy is SEBI registered or not.

For ex: Is @__paperstreet__ SEBI registered? Nobody knows. Nobody even knows who he is. But so many people are subscribed to his strategy.
19/ Also, if you don't do your due diligence and your money is blown up by someone who isn't SEBI registered, you can't seek any relief from TradeTron.

Refer to the screenshot below.
20/ They wash their hands of any and all responsibility to

i) Screening strategy creators
ii) Screening backtest legitimacy
iii) Screening strategy legitimacy
iv) Making sure creators are SEBI registered and licensed, and that their license/regn hasn't expired.
21/ Now, let's come to the problems with many of those strategies.

Most of the strategies are half baked. Looks like people testing something on stockmock for a year or two and creating that as strategy on tradetron to make money.
22/ Check this thread for a discussion on the most basic thing.

https://t.co/Z7XJDKF0ep

100% ROI in a year with 10-20% drawdown is possible. But not over a period of 10 years.

Cherry picking a good year and posting that as entire backtest result is dangerous.
23/ Tradetron does indulge in favoritism towards few creators, some shady practices, which if you talk to all the strategy subscribers, you'd begin to understand.

https://t.co/nzxW0buQB8

You can see that they have deleted the -ve comments in some strategies.
24/ But, they withhold the right to do that. This again, is buried in "terms of use".

Also, if you face huge slippages and execution issues at their end, they can always wash their hands off any responsibility by saying it's an internet/server issue, and show you these terms.
25/ Now, several users have quoted the following in their reviews/comments.

- Grossly misleading backtests
- Backtest / live trades huge discrepancies
- Some accounts blown out
- Backtests done only for few months
- Huge slippage and execution delays
- Loss due to outages
26/ This is not just particular to tradetron.

You pick any similar service. You check for the following things.

- SEBI/legal registration/compliance of the company
- SEBI registration of strategy creators
- Backtest methodology
- No of years tested for
27/ Also check for the following:

- Backtest / Actual live trades differentiation
- How many years backtest was conducted for
- How long the strategy has been active, and what its actual live returns are (after costs)
- Whether backtests are pre/post comms/spread/slippages
28/ This applies to any and all companies offering to manage your money in some way without your intervention or active effort.

Use this as a checklist and protect your downside first by doing your due diligence.
29/ Secondly, don't be naive enough to believe that you can double your money in a year or two, or that these strategy creators with backtests showing CAGR of 40-50% will get you such returns.

More often these claims are only a bag of farts. You'll be left holding just those.
30/ Third, most often, you'll put money in the hands of such people whose greed knows no bounds, blow up your capital, and realize you'd have done way better had you invested in a regular conservative mutual fund also.

So, save yourself all the trouble and go SIP in MFs.
31/ Two or maximum three mutual fund schemes, with an index fund, invested regularly with discipline using SIP, will create more wealth than any of these fake strategy creators can, for you.
32/ If you must definitely go for such high returns, it's not impossible.

Spend a year or two, learn python, backtest different ideas/systems yourself, and automate them.

Amazon EC2 or Azure + Broker's API, code in python and automate your strategies.
33/ Books, Links, Courses, Data - recommended for doing exactly the above is all in this link -

https://t.co/OoHznZbfTI
34/ I have summarized whatever I know about systematic trading in the following webinar.

Ignore the first and last 20-25 mins (about me in the intro, and about my course and the QNA in the outro) and watch the remaining 3 hours, for a head start.

https://t.co/NjMM50AOE4
35/ To conclude, don't chase quick returns.

You're better off putting money in an index fund and compounding/getting rich slowly.

Don't fall prey to someone else's greed, and lose your money due to your own greed.
36/ Also, remember one thing finally.

With these untested, half-baked platforms, you're being treated like beta testers when their service itself is not proper or reliable.

They should pay you, and not the other way around.

Skip them altogether, save your hard earned money.

More from Shravan Venkataraman 🔥🚀💰

Shravan Venkataraman \U0001f525\U0001f680\U0001f4b0
Shravan Venkataraman 🔥...
@theBuoyantMan
Breakout-retest-breakout

this pattern is among the high probability setups one can trade.

60-70% of breakouts fail.

If the breakout sustains the reversal pressure and manages to break above the breakout candle high,

there will be travel.

You can then take the trade in either of the two places.

1) When price is pulling back to the point of breakout - take trade at the breakout point.

If it closes inside the pre-breakout zone, get out.

2) When price pulls back, then breaks out of breakout candle high.

(1) is lower probability than (2) but higher probability than just taking the trade when price breaks out first.

It also comes with lower risk.

(2) is the highest probability trade (probably with relatively higher risk).

That said

If the breakout is from a multi-week or multi-month compression zone

do not expect pullbacks to happen immediately.

If they do happen, more often than not, it's a breakout failure.
SCREENERS
Shravan Venkataraman \U0001f525\U0001f680\U0001f4b0
Shravan Venkataraman 🔥...
@theBuoyantMan
A market wizard named Michael Marcus converted a $30,000 initial stake to $80 Million dollars over a period of 10 years.

Here are 28 lessons he considers very important for anyone venturing into trading, from his experience.


1/ The importance of not giving up:

In Fiddler on the Roof, there is a scene where the lead looks up and talks to God.

I'd look up and say, "Am I really that stupid?"

And I seemed to hear a clear answer saying, "No, you're not stupid. You just have to keep at it."

So I did.

2/ On key price levels:

There are key price levels like

- previous day/week/month highs or lows
- round number levels

where you can have 1:5 or more worth RR of trades if you place yourself right.

The key is to hit the crest of the wave, just at the right moment.

If it doesn't work out, you have to get out.

Doing this, you can make several hundred points, risking 1/3rd to 1/5th of what you make.

3/ The secret to getting efficient at trading:

Cut down the number of trades you make.

The best trades are those in which all 3 things check out:

- Fundamentals
- Technicals
- Market Tone
TRADING GUIDES
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Shravan Venkataraman \U0001f525\U0001f680\U0001f4b0
Shravan Venkataraman 🔥...
@theBuoyantMan
Working on some execution optimisation related backtesting. I have so far been executing with market orders only. Going towards higher lot sizes, I'd like to optimise for minimal slippage.

First off, on NSE, if you place a market order, you get filled at the best bid/ask right?

If we want to optimise this, the first non-creative idea one can think of is, slicing the order into different lot sizes, and placing a limit order for each slice at the mid point of current best bid & ask.

But this requires your latency to be the least.

Why would latency affect it?

I looked at tick historical data, and there are more than 18-20 ticks in a second (auction and quote combined).

Even if you keep 10 ticks per second, your best bid/ask can shift from the time you place to the time exchange receives the order.

So, the next best thing that people can do is place tranches of orders every 1s, 3s, 5s, 10s, 15s - in their preferred time range, and get filled at the midpoint or best-bid+1/2/3/4/5 in the depth.

What you need is liquidity.

But if you're trading breakouts, then it's highly likely that your limit orders may not get filled if the action is too fast.

So, a retry mechanism is required in such cases.

If nothing works, you convert your orders to marketable and get filled at worse slippage.
TRADING
Shravan Venkataraman \U0001f3a1
Shravan Venkataraman 🎡...
@theBuoyantMan
Interpretation of Financial Statements - preliminary filters.

1. Looking for sustainable competitive advantage:

When looking for sustainable moat, you wanna see consistency - in earnings, in having low debt, in having growing earnings, low spending in capital expenditures, etc.

The longer the company has existed, and if it sells you the same product for years (like Coca Cola), it reduces production costs and other costs (R&D, Training, marketing) slowly as the company ages.

When costs are reduced, margins and profits increase.

2. What to look for in an income statement:

Let's take a look at Apple:

i) You want to see earnings grow at a steady pace. Take a look at the net income below.


ii) Another thing that's important is a consistent and high gross margin.

As a thumb rule, Warren Buffett wants to see a gross margin of around 40% or above.

Although not quite 40%, it's around that range with respect to Apple.


Compare this to Apple's competitors.

Samsung's gross margins are around similar range, highest being 45.7% in 2018, and Huawei had a gross margin of 38.6%.
ECONOMY
Shravan Venkataraman \U0001f525\U0001f680\U0001f4b0
Shravan Venkataraman 🔥...
@theBuoyantMan
50 rookie mistakes to avoid as a stock market beginner - a thread.

1. Watching CNBC and acting on the recommendations provided by the "analysts", "experts" and "fund managers" who appear on TV.

Remember, most of them don't even beat the benchmark index on an annual basis.

2. Giving too much importance to Moneycontrol articles and recommendations. Moneycontrol profits off of noobs. They depend on you to make their money. They get paid by buy side firms who want to dump their positions, and sell side firms whose clients want to sell.

They also get paid to propagate rumours (albeit subtly) about stocks that the buy-side firms want to buy (albeit at lower prices) and sell-side firm clients want to buy. So, if you see a recommendation on moneycontrol, that marks the distribution phase (most of the times).

3. Listening to colleagues, friends, and family on what to invest on, where to invest, what stocks to buy. Usually these are also people who have no real expertise, but started a year or few months ahead of you. They only talk about their winners, you get very excited.

4. Listening to social media "experts". People on Twitter, Youtube, etc., even if they look like they are trading crores, or managing hundreds of crores, have different reasons for trading/investing in something. Typically, following them is the path to the butcher's shop.
TRADING

More from Trading

Trader knight
Trader knight
@Traderknight007
"A trend once established, is more likely to continue than it is to reverse"

A thread on Trend (Market structure)-


A trend is a path of least resistance, basically the side where the smart money is betting upon.

And our work is to be on their side, to make some money.

Why do we use trend?

In an uptrend, the sum of the rallies will always be greater than the sum of the declines.

In a downtrend, the sum of the declines will always be greater than the sum of the rallies.

How to Find the trend?

There are 3 methods which one can use-

1. Swing points method.
2. Moving averages.
3. Trend lines, channels.

1. Trend identification by using swing points-

• UPTREND in simple words - Higher highs, higher lows

• DOWNTREND in simple words - lower lows, lower highs.


• Flat trend - The price stays in a range
TRADING
Trader knight
Trader knight
@Traderknight007
A THREAD ON SL, TSL AND RE-ENTRIES-


WHERE TO PUT THE SL-

1. NEAREST PIVOT/SWING POINTS-

Normally I use this method for placing sl, In this method we use swing point for placing the SL.

As normally the stock would not try to go below previous swing point if it is to go in our direction.


2. ATR method-

Sometimes the Stock do not have any nearest pivot at time of buy, So we use this method as it gives us a level on basis of current volatility of the stock.

I use 1.5 ATR away sl , say the ATR at point of entry is 30, so I place sl
1.5 X, or 45 rs away from entry

In below example the entry is 120, ATR=5, SL= 1.5X ATR= 7.5 OR 113.

Nearest pivot was too far away, that’s why this method is used in these cases.


4. Anchor candles-

Anchor bars are those which have extreme Volume, gaps or wide Ranges.

Here, we place our sl below those candles which has the above characteristics.
TRADING
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M Lebon
M Lebon
@LongTplexTrader
So..had a great conversation last night with older investment types, old friends whom I traded with/against and managed money against or for. Age diff from me is > 10+ years so the takes were interesting but the common theme was a little disturbing (depends on your view)

Was looking at the landscape of the world & quite concerned where we are (I do not share your optimism for a shinny happy future). I am a Bond guy + Cycles & my view approach is ALWAYS what is the worst that can happen (that is how I was taught to trade & manage money) As a Bond

Money manager you never every want to apologize for a negative year, most people don't understand bonds can lose lots and lots and lots of money. So my view on life is always negative & fuck you approach.

The others are similar but have more equity exposure and FX, one other is really good via commodities so the conversation was from a top down look with some bottom up approaches. So.....after looking at the notes of the great conversation this is how it looked:

basically the world changed 2007/2008 especially North America. The GFC set in motion financial engineering games and here we are. The issues pre this (2000 to 2007) set ALL this up so lots of blame to go around but to pin point certain things the real problems started with QE &
TRADING , ALL
Saurabh Bajaj
Saurabh Bajaj
@JigyasuInvestor
Saturday Thread Time.
Re-Read interview of Ed Seykota from @jackschwager
book "Market Wizards". It's the most philosophical interview among all interviews. Needs to re-read it over and over.
@vivbajaj Sir, a re-tweet would be highly appreciated.

1. Systems don’t need to be changed. The trick is for a trader to develop a system with which he is compatible

2. The key to long-term survival and prosperity has a lot to do with the money management techniques incorporated into the technical system.

3. The profitability of trading systems seems to move in cycles. Periods during which trend-following systems are highly successful will lead to their increased popularity.

3.1 As the number of system users increases, and the markets shift from trending to directionless price action, these systems become unprofitable, and undercapitalized and inexperienced traders will get shaken out. Longevity is the key to success.

4. In order of importance to me are (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell.
TRADING
il Capo Of Ethereum
il Capo Of Ethereum
@CryptoCapo_
As a former professional poker player, I'm very clear about the importance of psychology in investing/trading.

You can have a very solid strategy, but if the mental aspect fails, everything fails, no matter how good you are.

Thread 👇

In this thread I will briefly describe the most important aspects of trading psychology, and give some simple tips to try to improve them.

It's good to always be aware of these aspects, to be able to detect them and act in time.

1) FEAR

This is one of the most important. It can make you get out of a position at the wrong time.

One of the main reasons you can have fear is because you are putting more at risk than you are willing to lose.

Tip: reduce the size of your position until you are comfortable.

2) GREED

Greed can be even worse than fear. It leads you to be overpositioned and to destroy your average entry.

Tip: learn to conform to what you have. Practice gratitude for everything that comes your way. Remember that the most important thing is to stay in the game.

3) TILT

This is well known in poker. There are many reasons why tilt can appear (downswings, injustice, mistakes...)

Tilt takes you away from your perfect strategy. From your A game.

After a losing streak you may think that the market is being unfair to you.
TRADING

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Robin Wigglesworth
Robin Wigglesworth
@RobinWigg
A thread on an interesting report by Goldman Sachs' Peter Oppenheimer, the bank's chief global equity strategist. He points out that Goldman's "Bear Market Risk Indicator" is looking ominous.


There are three factors that suggest that the recent stability could evaporate and that equities are "about to enter a sustained bear market", Oppenheimer says.

First is the fact that growth, inflation and interest rate outlook is unfriendly for equities.


Second is that greater volatility, such as multiple corrections and new peaks (which we've seen in 2018) tend to presage a full bear market.


Here is Goldman's data showing how falls and bounces tend to come ahead of "the dramatic final fall".
ECONOMY
Jaya_Upadhyaya
Jaya_Upadhyaya
@Jayalko1
SRI BANKEY BIHARI JI, VRINDAVAN (UP)

Very famous Krishna Mandir where Bankey Bihari Ji is worshipped and looked after as a child.
Bankey means “Bent at three places”.
Thakur Ji was worshipped in Nidhivan till 1863. This mandir was constructed in 1864 by Goswamis.
@LostTemple7


Legend says that Swami Haridas used to worship Krishna in Nidhivan.
Once, his curious disciples entered the forest but they were almost blinded by bright, intense light. Upon knowing this, Swamiji himself went there and after his requests, Krishna appeared with his consort.


Krishna, then, left back this black charming murti,which we see now, before disappearing.
A curtain is drawn before the murti after every 15-30 second. It is said that if one stares long enough into the eyes of Shri Banke Bihari, the person would lose his self consciousness.


Bankey Bihari Ji sports a flute only once a year on the eve of Sharad Purnima.
Darshan of His lotus feet can be done only on Akshay Tritiya every year.
There are no loud bells here and
no early morning Darshan can be done so that child Krishna’s sleep is not disturbed.
ALL
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அஸ்தினாபுரத்து அரசி👸...
@SivaRoobini555
#தினம்_ஒரு_திருவாசகம்
தொல்லை இரும்பிறவிச் சூழும் தளை நீக்கி
அல்லல் அறுத்து ஆனந்தம் ஆக்கியதே – எல்லை
மருவா நெறியளிக்கும் வாதவூர் எங்கோன்
திருவாசகம் என்னும் தேன்

பொருள்:
1.எப்போது ஆரம்பித்தது என அறியப்படமுடியாத தொலை காலமாக (தொல்லை)

2. இருந்து வரும் (இரும்)


3.பிறவிப் பயணத்திலே ஆழ்த்துகின்ற (பிறவி சூழும்)

4.அறியாமையாகிய இடரை (தளை)

5.அகற்றி (நீக்கி),

6.அதன் விளைவால் சுகதுக்கமெனும் துயரங்கள் விலக (அல்லல் அறுத்து),

7.முழுநிறைவாய்த் தன்னுளே இறைவனை உணர்த்துவதே (ஆனந்த மாக்கியதே),

8.பிறந்து இறக்கும் காலவெளிகளில் (எல்லை)

9.பிணைக்காமல் (மருவா)

10.காக்கும் மெய்யறிவினைத் தருகின்ற (நெறியளிக்கும்),

11.என் தலைவனான மாணிக்க வாசகரின் (வாதவூரெங்கோன்)

12.திருவாசகம் எனும் தேன் (திருவா சகமென்னுந் தேன்)

முதல்வரி: பிறவி என்பது முன்வினை விதையால் முளைப்பதோர் பெருமரம். அந்த ‘முன்வினை’ எங்கு ஆரம்பித்தது எனச் சொல்ல இயலாது. ஆனால் ‘அறியாமை’ ஒன்றே ஆசைக்கும்,, அச்சத்துக்கும் காரணம் என்பதால், அவையே வினைகளை விளைவிப்பன என்பதால், தொடர்ந்து வரும் பிறவிகளுக்கு, ‘அறியாமையே’ காரணம்

அறியாமைக்கு ஆரம்பம் கிடையாது. நமக்கு ஒரு பொருளைப் பற்றிய அறிவு எப்போதிருந்து இல்லை? அதைச் சொல்ல முடியாது. அதனாலேதான் முதலடியில், ஆரம்பமில்லாத அஞ்ஞானத்தை பிறவிகளுக்குக் காரணமாகச் சொல்லியது. ஆனால் அறியாமை, அறிவின் எழுச்சியால், அப்போதே முடிந்து விடும்.
ALL
Ramsay Rippers \U0001f354
Ramsay Rippers 🍔...
@RamsayRippers
🧵EMA + VWAP STRATEGY

Every trader has a go-to strategy that works best for them. My trading is all about keeping it simple stupid and revolves around two indicators - Exponential moving averages and vwap.

Here's the strategy that I utilize on nearly 80% of my trades.

👇

What are Exponential Moving Averages?

EMA's are a type of moving average that places a greater weight on more recent data points.

8EMA = Exponential Moving Averages of the last 8 candle closing prices.

EMA's adjust with respect to chart time frame.

What is VWAP?

Volume Weighted Average Price - A key intraday indicator in my trading that offers the true average price based on price & volume.

Calculation: (Price x # of shares traded) / total shares traded

EMA's I use

- 8
- 21
- 50

While I do utilize the 50EMA, the 8 & 21 EMA are most important for this strategy. Some people use the 9 and 20 which are essentially the same thing. REMEMBER: EMA'S adjust with respect to time frames.

A+ Set Up Criteria - (What I look for)
STRATEGY
Loren Brichter
Loren Brichter
@lorenb
So it turns out that Google Chrome was making everything on my computer slow *even when it wasn’t running*, because it installs something called Keystone which is basically malware.

I made a website because this shouldn’t

Wired first reported on how bad Keystone was 11 years ago when they put it into Google Earth (they seem to put it in all their popular

The fact that Keystone hides itself in Activity Monitor is bizarre. (The only sign of it was excessive CPU usage of WindowServer which is a system process).

I don’t know if Google was doing something nefarious with Keystone, or a third party figured out how to (which Wired warned about). But either way, I’m not inclined to give Google-the-organization the benefit of the doubt (despite the many good people who work on Chrome)...

...since it's been a decade+ and this still hasn't been "fixed".

There is no reason for auto-update software to need to do what Chrome/Keystone was doing. It also has a long history of crashing Macs.
TECH


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