Profitable ETF Trading Strategies:understanding the limitations of professional

It is conventional wisdom to advise traders to become more professional in their trading practice. This is almost always very good advice, because professional behavior will help protect you against the kinds of emotional hurt it animal behavior that is your enemy as you struggle to compete for profits in the market. 

I say this is almost always very good advice because there are some circumstances in which professional behavior can actually be detrimental if you are not careful. 

It is a common occurrence for a profession to define a paradigm of beliefs, theories and behaviors that should govern their domain of action, which collectively we might call doctrine. It is also a very common occurrence in history for professional doctrine to take on a life of its own and fail to adapt to a dynamic world. 

Under these conditions, the doctrine can become an end to itself and the professionals may lose sight of the original purpose of the doctrine as a source of authoritative advice and give it an aura of timeless truths instead. 

In that case, the professionals will have taken what were provisional solutions and tried to turn them into deep truths about the world and the way it works. 

It was precisely this insight that led me to develop what is now one of my most reliable and productive systems which came about as a result of taking the exact opposite of what could reasonably be called conventional wisdom. 

I made a list of the top dozen or so beliefs about how the market works and how you should plan to make money in it. These were beliefs that could easily be found in any bestseller on personal finance and investing. I defined a new set of beliefs that were the exact opposite of each one of these, and operationalized them in terms of screening criteria and technical analysis and so forth. 

I constructed a system that on the face of it violated every professional norm you could imagine. I then tested the system using back tests and forward tests in all kinds of market conditions and discovered that I had found a robust strategy for short-term trading that was effective in most market conditions. 

I can honestly say that I would never have intentionally developed this system from these anti-beliefs. This simply started out as a thought experiment that turned out to have surprisingly good results. 

This is also the kind of the system that professional traders in a professional group with a professional doctrine would be very unlikely to discover as a direct consequence of the constraints of their professional approach which under most circumstances is a positive thing. 

Choose your beliefs carefully.

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