2018 Trading Thread - Page 23 - Business, Finances and Investing Forum

Rand is just being idiot by saying random walk with drift is more predictable than random walk without drift. I was waiting for hours for someone to roast him lol.

Pretty sure nobody with a clue finds the discussion interesting. You either know what a random walk with drift is or you don't. There's literally nothing to discuss.

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02-22-2018 , 08:59 AM

#552

syndr0me

old hand

Join Date: Dec 2006 Posts: 1,669

I found the alligator charts very interesting

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02-22-2018 , 09:14 AM

#553

ibavly

2010 PSOP Champion

Join Date: Feb 2010 Posts: 24,513

Quote:

Originally Posted by rand

In short yes to the first part, and no to the second.

One of the best and simplest ways to model a random walk is with the flipping of a normal coin (ignore edge cases obviously).

The second (random walk w/out drift) would only be true if there were some kind of relationship between flips. Like if getting 100 heads makes tails more likely on the next flip. This is a common mistake at the roulette wheel and why casino's display histories there.

You wouldn't know in the later case because (with a legitimately random walk) each trial is independent.

It is, interestingly enough, another point against random walks in the markets. Almost everyone with a clue talks about overbought and oversold. The idea of reversion to the mean. If markets revert to the mean (hint: they do) then the trials are not independent.

Coin flip trials do not revert to the mean. Their expected value is the mean, but if you actually flip a coin 100 times, the odds that you will get 50 heads and 50 tails is pretty low. If you do that 101st flip however, the odds that you will get heads or tails on that trial is still 50/50.

You didn't Google it did you?

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02-22-2018 , 12:59 PM

#554

rafiki

Carpal \'Tunnel

Join Date: Jan 2006 Posts: 40,070

Wtf happened in oil today? Got my attention! Was out all day.

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02-22-2018 , 01:06 PM

#555

BrianTheMick2

Long way to go and a short time to get there.

Join Date: May 2012 Posts: 19,410

Quote:

Originally Posted by rafiki

Wtf happened in oil today? Got my attention! Was out all day.

It appears that it went up in price.

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02-22-2018 , 01:15 PM

#556

rafiki

Carpal \'Tunnel

Join Date: Jan 2006 Posts: 40,070

vintage Brian

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02-22-2018 , 01:19 PM

#557

MyrnaFTW

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Join Date: Nov 2011 Posts: 7,563

Quote:

Originally Posted by rafiki

Wtf happened in oil today? Got my attention! Was out all day.

I had the ultimate foresight of filling up on gasoline yesterday. It was fully on E.

Sent from my Pixel XL using Tapatalk

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02-22-2018 , 02:04 PM

#558

mrbaseball

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Join Date: Feb 2003 Posts: 13,090

Quote:

Originally Posted by rafiki

Wtf happened in oil today? Got my attention! Was out all day.

Popped on eia inventory numbers which should have come out yesterday but on holiday weeks they come out on Thursdays. It has been very useless to trade after the initial spike.

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02-22-2018 , 04:13 PM

#559

:::grimReaper:::

veteran

Join Date: Jul 2010 Posts: 3,113

Quote:

Originally Posted by stinkypete

Pretty sure nobody with a clue finds the discussion interesting. You either know what a random walk with drift is or you don't. There's literally nothing to discuss.

rand's post is amusing for the very reason that the discussion is not centered on the formal understanding of a random walk, rather the ability to think logically.

Edit: Guess it boils down to how you interpret "predictable". As a statician, predictable means variance around the mean, to a layman it may mean the probability the walk ends above 0.

Sent from my SAMSUNG-SM-G925A using Tapatalk

Last edited by :::grimReaper:::; 02-22-2018 at 04:33 PM.

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02-22-2018 , 04:34 PM

#560

Pokabandito

centurion

Join Date: Oct 2007 Posts: 173

Quote:

Originally Posted by ToothSayer

Yeah the thesis was institutional money buying up with the change. This kind of thing is right in the institutional wheelhouse. I don't know where it stops. I think the stock is a turd and still overvalued at $280 let alone $320, but if you want to keep front running the useless institutional buyers with a stop, I can't fault it too much.

I played it with next week calls so that huge run was a good spot to take the profit.

Didn't adjust the stop up and got taken out at 318 this morning. 9.6% return ain't bad, but playing the options correctly was undoubtedly more profitable.

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02-22-2018 , 05:02 PM

#561

ToothSayer

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Yeah next week options were an easy 7 bagger. 700% > 9%. Perfectly good stock play though and that's how I suggested it.

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02-22-2018 , 05:05 PM

#562

stinkypete

Carpal \'Tunnel

Join Date: Jul 2004 Posts: 15,783

Quote:

Originally Posted by :::grimReaper:::

It could also easily mean the ratio of the expected change to the standard deviation. Or several other things. It's just not an interesting discussion because it ends as soon as it's clarified which definition of "predictable" is being used. And arguing without defining it is just clowning around.

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02-22-2018 , 09:01 PM

#563

BrianTheMick2

Long way to go and a short time to get there.

Join Date: May 2012 Posts: 19,410

Quote:

Originally Posted by stinkypete

"Random walk with drift" is pretty well-defined in statistics. Other uses for the term would be what the pros call "extremely stupid."

More importantly, in an effort to be more helpful, here are my five unwritten rules of trading:

1.

2.

3.

4.

5.

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02-22-2018 , 09:04 PM

#564

Pokabandito

centurion

Join Date: Oct 2007 Posts: 173

Quote:

Originally Posted by ToothSayer

Yeah next week options were an easy 7 bagger. 700% > 9%. Perfectly good stock play though and that's how I suggested it.

So, was this one of your trades for the bet? If not, why?

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02-22-2018 , 09:17 PM

#565

stinkypete

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Join Date: Jul 2004 Posts: 15,783

Quote:

Originally Posted by BrianTheMick2

"Random walk with drift" is pretty well-defined in statistics. Other uses for the term would be what the pros call "extremely stupid."

Yeah, that's exactly what I said in the previous post.

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02-22-2018 , 09:25 PM

#566

BrianTheMick2

Long way to go and a short time to get there.

Join Date: May 2012 Posts: 19,410

Quote:

Originally Posted by stinkypete

Yeah, that's exactly what I said in the previous post.

Occasionally, when I quote a post I'm not disagreeing with it.

Weird, right?

Further helpful advice: Yelling at VIX futures seems to make them go down.

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02-22-2018 , 09:31 PM

#567

stinkypete

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Join Date: Jul 2004 Posts: 15,783

Quote:

Originally Posted by BrianTheMick2

Further helpful advice: Yelling at VIX futures seems to make them go down.

I bet if you yelled at 20 different futures contracts you could statistically prove that it works on at least one of them with 95% confidence.

Last edited by stinkypete; 02-22-2018 at 09:32 PM. Reason: If you're also willing to go long you can double the amount of trades you get out of it

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02-22-2018 , 10:00 PM

#568

BrianTheMick2

Long way to go and a short time to get there.

Join Date: May 2012 Posts: 19,410

Quote:

Originally Posted by stinkypete

I bet if you yelled at 20 different futures contracts you could statistically prove that it works on at least one of them with 95% confidence.

I have this old friend by the name of Bonferroni

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02-22-2018 , 10:06 PM

#569

stinkypete

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Join Date: Jul 2004 Posts: 15,783

Quote:

Originally Posted by BrianTheMick2

I have this old friend by the name of Bonferroni

Someone should have told him that we don't use statistics to be right, but rather to get scientific papers published.

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02-23-2018 , 10:35 AM

#570

applesauce123

adept

Join Date: Jun 2016 Posts: 851

Quote:

Originally Posted by BrianTheMick2

Further helpful advice: Yelling at VIX futures seems to make them go down.

I think this was a secret protected by the Illuminati

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02-23-2018 , 11:55 AM

#571

juan valdez

Pooh-Bah

Join Date: Jan 2009 Posts: 5,686

Quote:

Originally Posted by BrianTheMick2

Occasionally, when I quote a post I'm not disagreeing with it.

Weird, right?

Further helpful advice: Yelling at VIX futures seems to make them go down.

interesting to see big up moves evaporate two days in a row. i hope your short vol trade works out... until tuesday, then blows up

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02-23-2018 , 12:59 PM

#572

Morishita System

old hand

Join Date: Jan 2011 Posts: 1,391

I'm exiting my AKS trade for a 10%, since I want some room for my TSLA short and one other short that I'm going big on.

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02-23-2018 , 03:26 PM

#573

solid first post

centurion

Join Date: Dec 2013 Posts: 149

You shorting TSLA with options?

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02-23-2018 , 06:38 PM

#574

Morishita System

old hand

Join Date: Jan 2011 Posts: 1,391

Nope, I'm naked short shares at $340

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02-24-2018 , 02:14 AM

#575

Jupiter0

veteran

Join Date: Sep 2009 Posts: 2,470

My Planet Fitness PLNT beat on the quarter and are bumping up guidance. They are gonna buy back more stock. The franchise model continues to work well. Same store sales doing really well as always.

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