Advice

[Paul71]

you are of course right but u wont get much sense out of that paticular member

How long have you been trading, TS? 6 weeks?

Don't make me prove you wrong, TS.

 

[Paul71]

I will, 'suss', you out, TS. I've got just the questions for a pretender like you, TS.

What do you base 'risk' on, TS?

What is your fundamental reason for, risk. How do you evaluate it?

Are you a,.....1%er?

Or do you have method in your madness?

 

[shadowninja]

I assumed most technical analysis was heavily based on mathematics.
Guess i'm mistaken.

I do however get the idea that traders should be sharp, and mathematical.
But i only get told that because i'm planning to work in a bank as a trader.

TA is about maths but you don't have to know that much maths thanks to computers. Just use the graphs and understand what the graphs are telling you.

 

[Paul71]

TA is about maths but you don't have to know that much maths thanks to computers. Just use the graphs and understand what the graphs are telling you.

And that's it? Really easy isn't it, SN. What's your risk based on, SN?

 

[Paul71]

TA is about maths but you don't have to know that much maths thanks to computers. Just use the graphs and understand what the graphs are telling you.

And the maths you endorse, take into consideration ratios and percentages?

 

[Paul71]

I'm suprised anybody loses money!

 

[tafita]

Snownation, I urge you to listen to tightstops and Shadowninja. There are many demo accounts on the web you can sign up to for free to try your hand at requiring no money at all. Maybe you could use one of these to hone your skills and put into practice what you read. A most important aspect of trading is risk management as well as those already mentioned. Try looking at http://www.traders.com/Reprints/PDF_reprints/TC_FINE.PDF if the link does not work, PM me and I will email you the article as it's pretty good for a newbie.

 

[tightstops]

How long have you been trading, TS? 6 weeks?

Don't make me prove you wrong, TS.

ive been trading for 15 weeks and the last 3 have been profitable mainly because i only trade 20% of my account on any single trade

 

[Tenapenny]

ive been trading for 15 weeks and the last 3 have been profitable mainly because i only trade 20% of my account on any single trade

20% on a single trade is far too much for me. Just trading at 2% per trade. Need to protect my capital and I'm not a big gambler.

 

[damianoakley]

To Tightstops,

I've just read your post above about risking 20% on a single trade.

20%???!!!

That risk is massive (unless you're hitting a strike rate of about 95%).

Trust me, you seriously need to risk far less than that.


Thanks

Damian

 

[Snownation]

When people say they risk a certain percentage, in this case, 20%, does it mean, they are using a stop-loss of 20%?

Meaning on a £1 stake, out of a total £10,000, they put a stop-loss on £2000? i.e. 2000 point stop?

 

[trader_dante]

When people say they risk a certain percentage, in this case, 20%, does it mean, they are using a stop-loss of 20%?

Meaning on a £1 stake, out of a total £10,000, they put a stop-loss on £2000? i.e. 2000 point stop?

Yes

 

[trader_dante]

ive been trading for 15 weeks and the last 3 have been profitable mainly because i only trade 20% of my account on any single trade

20%!!!!

You need to get that risk down ASAP if you want to be around for any significant amount of time.

Having said that, a lot of people will tell you to only risk 2-3% per trade but you have to remember that everyone has their own individual risk profile so what one person considers too much risk, another person will consider acceptable.

A trader that wants to trade simply for pleasure - to see how much money, if any, they can make and perhaps only has a very limited size account may consider 20% to be fine. In addition to my business trading account, I like to open accounts with free cash bonuses and see how much I can make from them without adding any of my own funds. It's a game for me. Your first trade in these accounts though, invariably ends up risking as much as 50% unless you are a very short term trader (1m- 5m timeframes) and will only decrease gradually as time goes by.

A trader that wants to treat trading as a business and has a significant amount of money invested that they can generate a good living with minimal risk would probably not even consider going above 1% per trade.

So, tightstops, I can only surmise that you are not treating trading as a business but rather more as fun and that is fine as long as you are aware of it yourself.

 

[tafita]

Snownation, I would like to retract my earlier post about listening to tightstops as 20% per trade risk is massive as has been explained. Please listen to trader-dante instead, better still, take a look in the first steps section of this site and take a gander at his thread called making money trading. Personally I will only risk a maximum of 1.5% per trade.

 

[tightstops]

i made this post when very drunk for one reason - an interest in paul71s response.
but understanding that there are some people new to trading here looking for sound advice now realise it was unfair. 20% isnt just excessive risk you are guaranteeing failure. even if you can get past the scared money aspect you will be experiencing every trade the account will be worth next to nothing the next time a few trades go against you.
an ideal might be having 3 accounts and for intraday trading using 1% of one of these accounts for every trade. if frequently trading maybe a little more or less depending on the confidence you have for it otherwise and ideally when starting out and arguably beyond that just trading premium so no need to vary stake size since you only bet when you consider the setup to be as good as they get. for other trades maybe mid to long term make on one of the other accounts.
ive recently started paying more attention to where and why my accounts go up and down and have found that recently my fridays are terrible compared to my tuesdays and wednesdays so may consider factoring in some kind of risk for that. its worth bearing in mind that the distance between entry and stop is not necessarily all youre risking in some instruments.

 

[Snownation]

Thanks for all the help guys.

I'm starting to employ some strategy into my trading, and hopefully, in due course, i will grow to become a disciplined trader.

I would like to ask though, how frequent is it that all the City traders would actually follow simple uptrends and downtrends like normal traders?

To make myself clear. If i identify an uptrend or speculate what would be an uptrend, what is the likelihood that this trend does in fact follow through, keeping in consideration that Professional traders have other methods to go about this trend.

I'm thinking if there is a trend, i will hitch a ride.
But what are the chances that this trend is not actually the simple uptrend that i would it would turn out to be?

Do experienced traders use other methods to tackle this trend, or does everyone just follow through with it, and play along this trend?

 

[fibonelli]

Thanks for all the help guys.

I'm starting to employ some strategy into my trading, and hopefully, in due course, i will grow to become a disciplined trader.

I would like to ask though, how frequent is it that all the City traders would actually follow simple uptrends and downtrends like normal traders?

To make myself clear. If i identify an uptrend or speculate what would be an uptrend, what is the likelihood that this trend does in fact follow through, keeping in consideration that Professional traders have other methods to go about this trend.

I'm thinking if there is a trend, i will hitch a ride.
But what are the chances that this trend is not actually the simple uptrend that i would it would turn out to be?

Do experienced traders use other methods to tackle this trend, or does everyone just follow through with it, and play along this trend?

Snownation,
There are several threads on t2w regarding trading methods around trend following and of trend re-entry which should help you. You should also look on the WWW for ideas as well.

I can tell you that i'm finalising two trend based methods. One around entry in the early stages of a new trend and the second of re-entry into an existing trend.

F