Which?

[Joey25]

Trap?? If it wasn't for tight stops I would have been out of the game a long time ago. Tight stops allow a trader to stay in the game long enough to be become proficient. As you you become more proficient with your entries a number of things begin to happen.

1) Your positions move immediately into profit after entry
2) Your stops get hit less often
3) You make more profit/trade

This isn't an opinion, it is a fact.

End of story.

With respect, NT, it isn't the end of the story.

Yes, you may be proficient from one side of the equation, but deep down you know you are struggling due to poor returns.

This isn't being nasty, just an observation that to make the move into full time trading you're not going to realistically achieve it by throwing 10 contracts at 6 tick winners.

For a home-based trader, the margin requirements alone make such a strategy difficult to operate, let alone the psychological issues associated with picking up pennies in front of a train.

You've taken Socco's post about tight stops to an illogical extreme.

 

[chump]

As ever chump, I think we are both looking at this 'psychology' from completely different POV's.

As per you end your second paragraph, its the ability to retain emotional balance through, by firstly assessing ones risk tolerance and adjusting to it, prior, and managing it during.

Thats not psychology in my book, not in the context of the BS statistics, thats an intelligent, sensible business mathematical approach so one trades coldly and clinically without having a Spanish style heart attack when they have 3 losses in a row or a move goes 10 ticks offside.

I'm sure Tony is in the background typing furiously to negate all views and other something completely different though!

" I think we are both looking at this 'psychology' from completely different POV's."

Quite the contrary, I'd say you have understood it exactly the way I meant it ,but paraphrased it into words which to you explain it better. I could have used the same words and my intended meaning would have remained the same.

NT, that's fair enough.

 

[Black Swan]

everyonerich, blackswan ...

You seem unable to grasp my extremely simple point.

CB,

Check you PM's mate

How so? Check/manage risk correctly (according to plan) and results should follow. But not an easy question to answer or concept to deal with/separate...

 

[new_trader]

With respect, NT, it isn't the end of the story.

Yes, you may be proficient from one side of the equation, but deep down you know you are struggling due to poor returns.

This isn't being nasty, just an observation that to make the move into full time trading you're not going to realistically achieve it by throwing 10 contracts at 6 tick winners.

For a home-based trader, the margin requirements alone make such a strategy difficult to operate, let alone the psychological issues associated with picking up pennies in front of a train.

You've taken Socco's post about tight stops to an illogical extreme.

With respect Joey, you have made a number of inappropriate comments.

1) I have struggled with issues of discipline and sticking to my rules. This is what I mean by the absolute importance of mastering yourself. If had not been for tight stops I would have been out of the game long ago and I would not have had the realisations I have needed to have and this reinforces my opinions about using tight stops. I am putting it into practice every time I sit in front of my screen to trade. I do not talk about it glibly. I look at my accounts and if I eliminate the trades I have made when I should not have made (because I broke my rules) and held onto the trades when I have been right (on average about 5/6 trades), I would have a small fortune.

2) I didn't expect it to be easy to follow the advice of Socrates and he makes (made) no illusions about it either. Only recently, almost 3 years later, some of the advice he posted are beginning to 'land' to use his terminology.

I am not trying to convince anyone that I am right, all I am giving you is what I have experienced as a trader and as a result I fully endorse.

 

[Black Swan]

With respect Joey, you have made a number of inappropriate comments.

1) I have struggled with issues of discipline and sticking to my rules. This is what I mean by the absolute importance of mastering yourself. If had not been for tight stops I would have been out of the game long ago and I would not have had the realisations I have needed to have and this reinforces my opinions about using tight stops. I am putting it into practice every time I sit in front of my screen to trade. I do not talk about it glibly. I look at my accounts and if I eliminate the trades I have made when I should not have made (because I broke my rules) and held onto the trades when I have been right (on average about 5/6 trades), I would have a small fortune.

2) I didn't expect it to be easy to follow the advice of Socrates and he makes (made) no illusions about it either. Only recently, almost 3 years later, some of the advice he posted are beginning to 'land' to use his terminology.

I am not trying to convince anyone that I am right, all I am giving you is what I have experienced as a trader and as a result I fully endorse.

top post got any links to the legendary Socrates' posts? TIA

 

[0007]

Which comes first.... Be really honest with yourself here... When you start trading each week/day, or, when you run your figures through excel for the week ahead, or even, whilst in trades or about to enter, which really comes first?

Risk or reward?

Good question - both factors are v important. But for me reward comes first because, if the trade (according to my system) isn't gonna be decently profitable I just move on to the next potential. When I've got something that looks good I can then assess risk etc according to all the usual rules.

I suppose you could say that my initial assessment is in fact risk control but as much as I enjoy trading for itself, if it doesn't look as if there's a decent reward then i can't summon interest. You need decent system expectancy to put reward first. In the old days when I ran tight stops and put risk control first (as every beginner would be well-advised to do) I didn't lose too much and it kept me in business - but on the other hand I didn't make much either.

From the psychological point of view I've experienced an interesting phenomenon: Take a losing trade using spreadbetting - I'll come out at or before my planned stop. But depending on the stake I get a completely different feeling (stake is matched to the risk I wish to undertake and i match that to my assessment of reward). I suppose it's a manifestation of tolerance to drawdown but it just seems illogical that my mind is more hurt when it loses more even though it's within parameters etc etc. Conversley, when it's a winner i always wish i had staked more - but that's equally illogical if you believe in risk control. Anyone else experienced this?

I firmly believe that once you've got a half-decent system then it's all about psychology.