Holding Bag & Not Immediately Cutting Losses

This is a discussion on Holding Bag & Not Immediately Cutting Losses within the Trading Systems forums, part of the Methods category; Originally Posted by barjon The problem with “holding onto the bag” is that it often works out just fine, particularly ...

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Old Jan 2, 2018, 12:55am   #9
 
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Originally Posted by barjon View Post
The problem with “holding onto the bag” is that it often works out just fine, particularly if you have been trading in a bull market (as you have been doing). The trouble with that is that it only takes one or two not to work out and the losses build up until they have undone many months of carefully husbanded gains.

Brumby is being very kind when he says your strategy might become more problematic. An account killer I’d say
Would certainly agree here to an extent. If I were to continually average down, a couple “bags” could blow up my account. But with the starting positions at such a relatively low fraction of my brokerage account, they could theoretically go to $0.00 (yikes) and while that would be brutal, it would only be responsible for a small percentage of my overall holdings. The hope is the consistent success outside of those few bad eggs will far more than outweigh them.
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Old Jan 2, 2018, 1:03am   #10
 
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Originally Posted by MiniBagTrading View Post
Would certainly agree here to an extent. If I were to continually average down, a couple “bags” could blow up my account. But with the starting positions at such a relatively low fraction of my brokerage account, they could theoretically go to $0.00 (yikes) and while that would be brutal, it would only be responsible for a small percentage of my overall holdings. The hope is the consistent success outside of those few bad eggs will far more than outweigh them.
I know you won't be persuaded, so be very careful. Particularly so when the market turns. Come back on here in a year or two and see if you still think the same.
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Old Jan 2, 2018, 12:34pm   #11
 
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What are you trading ?
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Old Jan 2, 2018, 2:29pm   #12
 
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What are you trading ?
Primarily US stocks. Haven’t focused specifically on any particular sector.
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Old Jan 2, 2018, 9:49pm   #13
 
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Very dangerous game, you'll end up holding 10 stocks and no cash for years, it's just a question of when it's going to happen...
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Count de Money number 1 trading rule: EDUCATE YOURSELF!

Before you trade even single penny on the stock market, please spend the time and educate yourself by back testing different trading strategies and ideas - go to eBay and search for "historical stock market data", you can buy 20 years of data for less than $100 - that's all you need to start.
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Old Apr 14, 2018, 11:14pm   #14
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Kenny Glick

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Originally Posted by MiniBagTrading View Post
.. someone who doesn’t exit a losing day trade and cut his/her losses is a “bagholder” ...
Kenny is a funny guy and has some advice for those tempted to put losing trades in the "bag". An interesting video anyway with a few trading insights - Glick style..


Last edited by Kaeso; Apr 14, 2018 at 11:25pm.
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