What's an 'edge' in this? - discussion...

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Original-Soultrader
Posts: 67
Joined: Mon Mar 27, 2017 12:19 am

i've spent the last few days reading through posts in here and i often see people talking about having an 'edge'

My background is in forex trading amongst other things - I certainly had an edge for a good while in forex. But an edge in forex is pretty constrained - like on a particular instrument when X happens, then Y happens X% of the time.

On different instruments the edge either didn't work or had different parameters. Forex is complicated for sure, but each instrument is essentially it's own market with very few variables that change.

I also hear in peter's videos him talk about 'different markets' operating in different ways.

So here's the thing - from what i've seen so far (and i understand that is limited) every market is a different and unique market. You have the course, you have X number of horses, you have X number of jockeys, you have the weather, the 'going' and firmness of the course, the ages of the nags, you have time of day and the time of year and more that i haven't even considered yet.

In the forex market most of these things are fixed with the exception of time / date and economic outlook.

Finding an 'edge' in the forex market is almost impossible - having worked my way through literally thousands of systems over approaching 20 years I can assure you that there is hardly any 'edges' that consistently make money. The winners in forex are discretionary traders that have learned to read the market at the specific time they are trading using nothing but gut instinct and experience (with the exception of highly complicated algorhythmic trading) and money management

Now i come on here and see people saying they have an 'edge' in a sphere with incalculably more variables than forex compressed into smaller timeframes. This surprises me a lot.

so let's define an edge so we agree on the definition - to me an edge is a repeated sequence of events that results in a measurable level of success. basically a step by step, if this happens then do this, if that happens do that, manage the money like this, manage the exit in this way etc. It's basically a recipe of what a trade looks like.

An edge can be fully automated. There are many tools for doing this in forex and of course betangel has this ability too. But I also read that there is no automation known that will extract profits from the market every week / month with consistency if they are just left alone - so that means it's not an edge but relies on discretionary changes by the owner. in effect they just semi automate decisions that you make yourself - great time saver, but not an edge.

To me the horse racing exchange looks more to be the epitome of discretionary trading. you learn by doing and by the passage of time you learn what to trade and what not to trade based on the information presented to you.

That isn't an edge though, that's a learned skill isn't it?

or am i wrong? ..... discuss :)
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Derek27
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Joined: Wed Aug 30, 2017 11:44 am
Location: UK

I disagree on your definition of an edge. An edge isn't necessarily a system or set sequence of steps. It's basically an advantage that enables you to consistently win.

At the moment at least, I'm a 100% manual trader - I use my judgement to open, manage, and close a trade. But I have an edge because I consistently win. This is in contrast to either, random trading, or trading with poor judgement which could be even worse than random trading.
DoctorEvil
Posts: 16
Joined: Wed Jun 21, 2017 9:07 am

Original-Soultrader wrote:
Mon Jan 08, 2018 1:26 am
so let's define an edge so we agree on the definition - to me an edge is a repeated sequence of events that results in a measurable level of success. basically a step by step, if this happens then do this, if that happens do that, manage the money like this, manage the exit in this way etc. It's basically a recipe of what a trade looks like.

An edge can be fully automated.
IMO edge = an ability to make +EV trades. nothing more, nothing less. some simpler (mechanical) edges can be automated (check greyhound thread), while things like "reading" the market require a human brain, unless you're some kind of AI expert. to automate this would require great knowledge on your part and lots of data with a big number of different variables, that's what makes it so hard to automate.
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Euler
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Joined: Wed Nov 10, 2010 1:39 pm
Location: Bet Angel HQ

IMHO More or less the edge in this game is that you direct market access to the exchange on an equal level to other players, whoever they are, and can more or less act as a market maker. There are many strategies that branch out from that. You can't really do that on financial markets. There are negligible transactions costs on this market also. There are tons of edges whether you trade manually or automatically. Some rely on your ability to read a sport or some rely just on others taking your orders, there are many ways to trade successfully in sport.

In forex you need to be smarter than others, in sports markets you just need to not be as daft as others, predominately gamblers.
Alpha322
Posts: 846
Joined: Fri Oct 30, 2009 4:45 pm

Original-Soultrader wrote:
Mon Jan 08, 2018 1:26 am
i've spent the last few days reading through posts in here and i often see people talking about having an 'edge'

My background is in forex trading amongst other things - I certainly had an edge for a good while in forex. But an edge in forex is pretty constrained - like on a particular instrument when X happens, then Y happens X% of the time.

On different instruments the edge either didn't work or had different parameters. Forex is complicated for sure, but each instrument is essentially it's own market with very few variables that change.

I also hear in peter's videos him talk about 'different markets' operating in different ways.

So here's the thing - from what i've seen so far (and i understand that is limited) every market is a different and unique market. You have the course, you have X number of horses, you have X number of jockeys, you have the weather, the 'going' and firmness of the course, the ages of the nags, you have time of day and the time of year and more that i haven't even considered yet.

In the forex market most of these things are fixed with the exception of time / date and economic outlook.

Finding an 'edge' in the forex market is almost impossible - having worked my way through literally thousands of systems over approaching 20 years I can assure you that there is hardly any 'edges' that consistently make money. The winners in forex are discretionary traders that have learned to read the market at the specific time they are trading using nothing but gut instinct and experience (with the exception of highly complicated algorhythmic trading) and money management

Now i come on here and see people saying they have an 'edge' in a sphere with incalculably more variables than forex compressed into smaller timeframes. This surprises me a lot.

so let's define an edge so we agree on the definition - to me an edge is a repeated sequence of events that results in a measurable level of success. basically a step by step, if this happens then do this, if that happens do that, manage the money like this, manage the exit in this way etc. It's basically a recipe of what a trade looks like.

An edge can be fully automated. There are many tools for doing this in forex and of course betangel has this ability too. But I also read that there is no automation known that will extract profits from the market every week / month with consistency if they are just left alone - so that means it's not an edge but relies on discretionary changes by the owner. in effect they just semi automate decisions that you make yourself - great time saver, but not an edge.

To me the horse racing exchange looks more to be the epitome of discretionary trading. you learn by doing and by the passage of time you learn what to trade and what not to trade based on the information presented to you.

That isn't an edge though, that's a learned skill isn't it?

or am i wrong? ..... discuss :)
Why do you Forex traders come on here and try and compare, they are two different types of markets completley i have my edge lie Derek 247, and whats enhanced my edge even more is the new Servant modules
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ShaunWhite
Posts: 9731
Joined: Sat Sep 03, 2016 3:42 am

Original-Soultrader wrote:
Mon Jan 08, 2018 1:26 am
In the forex market most of these things are fixed with the exception of time / date and economic outlook. Finding an 'edge' in the forex market is almost impossible

Now i come on here and see people saying they have an 'edge' in a sphere with incalculably more variables than forex compressed into smaller timeframes. This surprises me a lot.
It shouldn't be suprising that where there are more variables, there are more avenues to explore.

That is mathmatically true and also seems logically true. There must(?) be more avenues/edges than traders, because in such a small market, an edge shared is an edge at best halved, or at worst completely lost.

I've always assumed that there are only a small handful of people persuing any given edge and one time. If the number increases then the edge diminishes.
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Black Ice
Posts: 258
Joined: Thu Nov 06, 2014 12:35 pm
Location: Newmarket Suffolk

:)That isn't an edge though, that's a learned skill isn't it?

or am i wrong? ..... discuss
I agree with Soultrader. IMO the word 'edge' is way overused! You are either a good trader because you make good (learned) decisions..or a bad trader because you make bad (learned) decisions...or smewhere in between...but in manual trading you are constantly making decisions from what you have learned. Where a possible 'edge' comes is in automation if you understand a sport well...you can automate in a way that things are more likely to happen...because you read the sport well...call that an 'edge' if you like...but understanding the sport well was still a skill that you learnt.
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Dallas
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Joined: Sun Aug 09, 2015 10:57 pm
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Euler wrote:
Mon Jan 08, 2018 11:41 am

In forex you need to be smarter than others, in sports markets you just need to not be as daft as others, predominately gamblers.
I'de stick that in with some of 'Le Tiss's' hall of fame of one liners :D
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