DISQUS

John Forman · 1 month ago

"We are in favor of paper trading to the extent that it helps traders learn the mechanics of trading (and taking losses). However there is no substitute for experiencing the ups and downs of actual dollars on the line (no matter how small an amount)."

I agree 100%. I wrote in my book and have repeatedly stated on my blog and other places that new traders should, as soon as they understand the basic trading mechanics, put a small amount in a live account and do some live trading. It will teach the newbie so much about how they need to approach the market to not get overrun by the emotions of having real money on the line when it's time to get serious.

aiki14 · 1 month ago

I come down with Bayes on this
The basic lesson of Bayesian analysis is that you can learn only from information that disconfirms some part of your current belief set.  But of course the natural tendency of the mind is to minimize cognitive dissonance by accepting confirming evidence and rejecting disconfirming evidence, and that tendency is emphasized when beliefs get to be badges of group membership. Bayesian statisticians argue that even when people have very different prior subjective probabilities, new evidence from repeated observations will tend to bring their posterior subjective probabilities closer together. However, others argue that when people hold widely different prior subjective probabilities their posterior subjective probabilities may never converge even with repeated collection of evidence. These critics argue that worldviews which are completely different initially can remain completely different over time despite a large accumulation of evidence.
Not to get too complicated of course