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Defining the 'probability' is the first error if using mathematical models. This is not an issue if you manage the 'possibility'.

In your earlier post you listed a number of risk management strategies promulgated by Howard.

As Howard Bandy advocates trade frequently , trade accurately , hold a short period of time .

However not everyone wants to, or can, trade this way, specifically, holding a short period of time, although 'short period' is not defined.

" .. trade a lot so no 1 trade puts you under duress , trying to add 20% to account in one trade increases risk of ruin , doing 50 trades to make 20% doesn't "

I'm not clear on whether this is a strategy of diversification, or just high frequency trading.

There are many ways to deal with risk , it aint rocket science . BUT unless you do stats on this type of stuff you are clueless ( don't be clueless ) .

We return to 'stats' which is the reliance on the empirical. This is what I oppose. I am more of the mind to manage risk a priori. To state that an absence of an empirical analysis makes the person clueless, is an assumption that smacks of mathematical arrogance and itself implies a blindspot to risk.

The OP just doesn't get it or just likes to argue ( he is a lawyer afterall and will continue to argue even when he knows he isn't correct , it's his job . Don't give him practice ) . Its not difficult to do this systems stuff logically ..

What does 'OP' stand for, I'm curious?

Yes I am a lawyer and again it is a misconception that we [as a profession] argue when we know we are wrong. We have a legislated code of ethics that specifically addresses this point.

I enjoy a spirited discussion, this is true, but only with willing participants. I will on occasion argue a position [set of facts] that I do not agree with, playing devils advocate, but this is not to say that I would argue as a fact something I knew to be false.

Mathematics is [pure] logic. However in logic the premise must be a true statement, otherwise the conclusion, even if argued logically, will be incorrect. With statistics, as applied to financial markets, the premise is incorrect, which has been demonstrated a number of times with high profile blow-ups.

jog on
duc

<blockquote data-quote="ducati916" data-source="post: 949579" data-attributes="member: 2975">Defining the &#039;probability&#039; is the first error if using mathematical models. This is not an issue if you manage the &#039;possibility&#039;.In your earlier post you listed a number of risk management strategies promulgated by Howard.As Howard Bandy advocates trade frequently , trade accurately , hold a short period of time .However not everyone wants to, or can, trade this way, specifically, holding a short period of time, although &#039;short period&#039; is not defined.&quot; .. trade a lot so no 1 trade puts you under duress , trying to add 20% to account in one trade increases risk of ruin , doing 50 trades to make 20% doesn&#039;t &quot;I&#039;m not clear on whether this is a strategy of diversification, or just high frequency trading. There are many ways to deal with risk , it aint rocket science . BUT unless you do stats on this type of stuff you are clueless ( don&#039;t be clueless ) .We return to &#039;stats&#039; which is the reliance on the empirical. This is what I oppose. I am more of the mind to manage risk a priori. To state that an absence of an empirical analysis makes the person clueless, is an assumption that smacks of mathematical arrogance and itself implies a blindspot to risk.The OP just doesn&#039;t get it or just likes to argue ( he is a lawyer afterall and will continue to argue even when he knows he isn&#039;t correct , it&#039;s his job . Don&#039;t give him practice ) . Its not difficult to do this systems stuff logically ..What does &#039;OP&#039; stand for, I&#039;m curious?Yes I am a lawyer and again it is a misconception that we [as a profession] argue when we know we are wrong. We have a legislated code of ethics that specifically addresses this point.I enjoy a spirited discussion, this is true, but only with willing participants. I will on occasion argue a position [set of facts] that I do not agree with, playing devils advocate, but this is not to say that I would argue as a fact something I knew to be false.Mathematics is [pure] logic. However in logic the premise must be a true statement, otherwise the conclusion, even if argued logically, will be incorrect. With statistics, as applied to financial markets, the premise is incorrect, which has been demonstrated a number of times with high profile blow-ups.jog onduc</blockquote>

[QUOTE="ducati916, post: 949579, member: 2975"] Defining the 'probability' is the first error if using mathematical models. This is not an issue if you manage the 'possibility'. In your earlier post you listed a number of risk management strategies promulgated by Howard. [I]As Howard Bandy advocates trade frequently , trade accurately , hold a short period of time [/I]. However not everyone wants to, or can, trade this way, specifically, holding a short period of time, although 'short period' is not defined. " [I].. trade a lot so no 1 trade puts you under duress , trying to add 20% to account in one trade increases risk of ruin , doing 50 trades to make 20% doesn't[/I] " I'm not clear on whether this is a strategy of diversification, or just high frequency trading. [I]There are many ways to deal with risk , it aint rocket science . BUT unless you do stats on this type of stuff you are clueless ( don't be clueless ) [/I]. We return to 'stats' which is the reliance on the empirical. This is what I oppose. I am more of the mind to manage risk a priori. To state that an absence of an empirical analysis makes the person clueless, is an assumption that smacks of mathematical arrogance and itself implies a blindspot to risk. [I]The OP just doesn't get it or just likes to argue ( he is a lawyer afterall and will continue to argue even when he knows he isn't correct , it's his job . Don't give him practice ) . Its not difficult to do this systems stuff logically ..[/I] [I][/I] What does 'OP' stand for, I'm curious? Yes I am a lawyer and again it is a misconception that we [as a profession] argue when we know we are wrong. We have a legislated code of ethics that specifically addresses this point. I enjoy a spirited discussion, this is true, but only with willing participants. I will on occasion argue a position [set of facts] that I do not agree with, playing devils advocate, but this is not to say that I would argue as a fact something I knew to be false. Mathematics is [pure] logic. However in logic the premise must be a true statement, otherwise the conclusion, even if argued logically, will be incorrect. With statistics, as applied to financial markets, the premise is incorrect, which has been demonstrated a number of times with high profile blow-ups. jog on duc [/QUOTE]

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