Becoming A Cyborg Trader

Graybox Trading

Aug 04

My vision for my trading is to become more like a cyborg trader otherwise known as the quantamental approach. I am very good at predicting the market and reading the tape. But, I am not as good at trading when I am down and self doubt causes me to make certain types of mistakes. While I cannot share everything that I am doing, I can share that I am moving toward trading more like a “cyborg enhanced” trader and will be applying ML and AI tools rigorously.

If you look at information, it can be built up as a hierarchy  follows:

  1. Raw Data Level. At the data level, you benefit from having an unfiltered view but it is very difficult to make sense of.
  2. Basic visual representation. Think candlesticks.
  3. Enhanced visual representation. This is what candlesticks do for prices and what my software does for reading the tape.
  4. Expectation modeling. This is the area of classical systems. It is, also, a serious limitation that most indicators do not output expectations.
  5. Inference level. Great discretionary traders exhibit high levels of market cognition which are inferences about what might happen from the data. Unfortunately, these inferences are often based on poor data and without knowing the basic expectation.

Computers are incredibly powerful today. Discretionary traders who aren’t adopting new methods and taking advantage of readily available computing power are at significant disadvantage.

About the Author

The author is passionate about markets. He has developed top ranked futures strategies. His core focus is (1) applying machine learning and developing systematic strategies, and (2) solving the toughest problems of discretionary trading by applying quantitative tools, machine learning, and performance discipline. You can contact the author at