Do you have anything similar to share, from books, interviews, personal experiences or otherwise, with regard to short term trading and not intraday?
I guess you would have some.
Long drawn subject, let’s hole out a direction at least for now.
- Trading is a probablistic mathematical model to make money. Expectancy multiplied by opportunities. This is pure mathematics. These two sources are more than decent:
- Universal Principle of Trading by Brent Penfold
- Trade your way to Financial Freedom by Van K Tharp
- Second side is entry set up and plan. Plan includes exit,pyramid, leverage, stats, metrics, book keeping etc. For example there is nothing called full time FNO trader. FNO is an instrument to leverage your finances, more to do with risk management/money management.
- For quantitative set ups- Brent penfold gives some direction, you can include book by Nick Radge. High end quant models are another area, they don’t run python at institutional level. Rat oil is sold to people to trap a open source software.
- For every trader fundamental matters to take a direction (even those who are quant have a good grip on macro).
a. For stock trading- CANSLIM by O Neil plus Market Smith is a good maintained resource and supported. There are many others too like technical analysis book.
b. For commodity markets- sector journals review etc like ISR (India Steel Review).
- For building a trading philosophy which includes psychology you can include these:
a. Trading in the Zone by Mark Douglas
b. Trader’s profile- All five books by Jack D Schwager
Again, Indian markets are way different than US market in terms of margins, deleveraging, value chain of companies and so on. So customising a foreign book is another life time conduit. Indian authors, no good trader and investor rarely spends writing a book. That’s unfortunate, but that’s what it is!
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Thank you for the elaborate reply, that is more than I can absorb even in a year, much appreciate it.
Yes, it is a pity that we don’t have too many books that are exclusively written about our market, catering to Indian retail. I wish we have a Peter Lynch like manager/author, perhaps managers from the big fund houses can do this, may be they will after detaching themselves from the finance industry, so as to reveal the secret recipes or secrets if any.
nonsense. It may be rat oil to you but its perfectly fine for my purpose. We don’t have absolutes in trading, different things work for different people in different context. Open source software is great. I trade using python on Linux and am doing just fine. Zerodha apparently has many tools built on top of OSS. So this is just your own bias …
python saves time and can be very fast through libs or slow without it. If Amibroker type tools are usable for trading then so is python, just need to work more but can customize exactly as needed. Anything other than HFT type trading should be fine with any reasonable tool.
There is not a single financial inst who use python at middle office. 99% transactions are carried out by them.
What works for me and you, biasness doesn’t matter. When 99% sources define a direction that’s a stat and facts. If something is working for you, me and anyone else doesn’t substitute the data.
Python is not used by many who carry out HFT. But otherwise plenty of small institutions use python for algorithmic trading. If ‘utmost speed’ is not a concern, python is just so convenient. Calling it ‘Rat oil’ is plain silly.
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It may be convenient for you, I don’t disagree. That’s not debate here. Can you tell me which financial inst using python i.e. small or big (name 2/3 of them). There is a difference between inst and financial inst.
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It is convenient and efficient enough for me and for a lot of financial institutions. By using terms like “rat oil” you are letting emotions (and perhaps biases) overflow onto an objective discussion.
Apparently they do…
Python is a core language for J.P. Morgan’s Athena program and Bank of America’s Quartz program. Investment banking guru Kirat Singh says: “Everyone at J.P. Morgan now needs to know Python and there are around 5000 developers using it at Bank of America.”
“As the use of machine learning techniques and statistical analysis becomes more influential in the investment process for funds, Python and associated libraries (Pandas etc) are replacing R, Java and C++,” says Dean Looney, a quant headhunter at London search firm Referment. Python simply offers quantitative technologist, “a lot more flexibility and functionality,” Looney adds.
Hedge funds don’t use Python for everything, but they use Python for a lot. Balyasny Asset Management, for example, is looking for data analysts conversant in Python to work on fundamental research, data gathering and processing, along with back-testing data-driven idea generation. However, it’s looking also looking for people who can code in C# to work on front office trading systems operating with sub-second latency.
Python is too slow to replace C++, C# or Fortran on high-frequency systems, but for a lot of hedge funds and for a lot of the functions hedge funds require it for, this isn’t the point. - “Python isn’t the fastest language on the world – but it’s fast enough for what hedge funds need it to do a lot of the time,” says Sean Hunter, a former Goldman Sachs technology VP and tech consultant. “A lot of hedge funds will have a Python notebook that they run once a day and that pulls in all their positions and performs all the risk calculations.”
Athena is a trade management solutions tool, not deal desk tool. Second Athena is a program which includes python code to my knowledge (I am not a technical person). You pasted all articles (not from banking source) stating developers need to know python, for your kind information developers are not investment bankers but support teams. For example, respected Mr. Singh is a tech guru, he is not a front office or middle office guy. Of course, he will talk about all tech enhancements. Investment banking functions are different (again you are mixing up with fintech), of course technology is an enabler everywhere. No denying there.
Anyway, to temper down my swipe was not at a particular name or code as “objective interpretation” but something else. Let me clarify again:
- An engineer or graduate joining an IT Services company paid around say 1 lac per month, with 20% CAGR hard to achieve in salary suddenly been told about stories. Buy a system, back test and make tones of money (like the subject line here- what gentleman put the query).
- The person doesn’t bother to understand corporate governance or business strategy or even basic finance. Just went by stories online, screenshots and conclude yes, I can do it.
- Even the person didn’t take a pain to cross check what is the success rate, where they are profiled. Forget that even should I cross check data from authenticated sources.
Problem is many thinks automation replaces a domain. It just helps, it enables. Without knowing the domain difficult to finish the wheel in totality. Excel is still the widely used software in most of banks including IB/FS. It doesn’t mean excel is a trading or IB function. It’s just a tool while executing one of many activities.
Everyone can do it, subject to they should re-grind to know every aspect of a domain. In that context my submission was to re-evaluate your approach and validate.
The Youngman @Zodiac who asked the question sounded very genuine to me. It will be disservice if I tell him some nice, sweet words eventually works as poison. That’s my take, anyone can feel free to disagree. Nothing more, nothing less.
By the way Ex- JPM here.
Period, no more discussion on this.
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Hmm. Okay. This sounds much more balanced and real.
Its not the language that matters for what most algorithmic traders are trying to achieve with python. For data science it is a pretty good choice.
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you must be fun at parties.
I definitely don’t believe with hanging out with the popular crowd in markets.
All I can say this much is if you found a system or a tool built on whatever tech that works then use it but be vary not to end with popular crowd. If everyone uses same set of tools, all of you end up going in same direction creating a killzone for big institutions & big banks to slaughter well. There are plenty of proof, news and examples. Field is not level, big institution trader don’t play with same rules as retail traders.
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i personally believe success in stock trading is all about mindset …
If are expenses are taken care of then trading becomes more easy
Fear makes trading very tough
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You must increase it a bit more before you start to withdraw it. You can work in a business part-time or something that doesn’t require much work.
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If you are confident about your strategy, then stick to trading. A 62% win rate is very rare, and very high! Much more than what normal people can even think of.
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Stick to your trading plan and remain disciplined. You have to be financially stable first before you start to trade stocks full-time. For that, consider something that can make you earn on a consistent basis. Plus, do not rush to trade stocks full-time without enough experience or expertise.
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Focus on learning more than earning first because many traders focus on earning first before learning, and they lose. Plus, learn trading psychology and risk management and stay disciplined and consistent to get the results.
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