Succeeding at Trading Through Innovation
One of the distinguishing features I've found among successful traders is that they innovate. They don't look at the same markets in the usual ways. They find new ways of viewing and trading markets.
Here is an excellent video from high school senior Julian Marchese, who is one of the founders of the Leaders Group mentioned in an earlier post. He demonstrates how he uses a correlation workbook in Excel to identify potential "relative value" or "mean reversion" trades. The workbook also shows which macro markets are moving with others, highlighting particular themes that are dominating the macro trade.
When I first met Julian, he had no particular experience with quantitative analysis or Excel programming. He taught himself the relevant skills so that he could become multifaceted in his views of markets. His key insight is that markets don't move in isolation: many times they move thematically, in response to macroeconomic developments. By tracking the correlated movement of assets, it is possible to read the themes that are driving market action and bet either on the continuation of those themes or their reversal.
Further Reading: Pain and Gain in a Trader's Development
Here is an excellent video from high school senior Julian Marchese, who is one of the founders of the Leaders Group mentioned in an earlier post. He demonstrates how he uses a correlation workbook in Excel to identify potential "relative value" or "mean reversion" trades. The workbook also shows which macro markets are moving with others, highlighting particular themes that are dominating the macro trade.
When I first met Julian, he had no particular experience with quantitative analysis or Excel programming. He taught himself the relevant skills so that he could become multifaceted in his views of markets. His key insight is that markets don't move in isolation: many times they move thematically, in response to macroeconomic developments. By tracking the correlated movement of assets, it is possible to read the themes that are driving market action and bet either on the continuation of those themes or their reversal.
Further Reading: Pain and Gain in a Trader's Development
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