Focus or Money Management?

1

12WBT

0 0
Day trading on very short times frames.
Tick, 1 min charts, etc or the DOM.

What is more important to you?
Focus or money management.
Love to hear other traders thinking or thoughts.
 

counter_violent

Legendary member
11,280 3,005
Day trading on very short times frames.
Tick, 1 min charts, etc or the DOM.

What is more important to you?
Focus or money management.
Love to hear other traders thinking or thoughts.

Money management.

Just get long short as many times as you like. Think of it as tossing coins....how many times can you be wrong given that you can bias either side ! :)
 
1

12WBT

0 0
Been thinking about this for a while now.

When I posted I was thinking money management was a biproduct of focus.
And that focus will control the outcome, wrong or right.

But then doe's money management control focus.
 

Cornix

Well-known member
267 22
Both decent money management rules and focus obviously needed. No lapses, even small lapses ever allowed in trading. It's a very competitive business.
 

Trader333

Moderator
8,655 981
You need both in my view as they are not mutually exclusive.
 

Splitlink

Legendary member
10,850 1,234
Money management.

Just get long short as many times as you like. Think of it as tossing coins....how many times can you be wrong given that you can bias either side ! :)

Don't you think that the money management should have been considered before entering the trade? Tossing coins is random, so each closing trade will decide how much further to go with that procedure and what loss can be tolerated on each trade.
 

counter_violent

Legendary member
11,280 3,005
Don't you think that the money management should have been considered before entering the trade? Tossing coins is random, so each closing trade will decide how much further to go with that procedure and what loss can be tolerated on each trade.

Well, for those who want to sit there all day focussing and timing trades, then that's fine. But in my experience, there is a danger of trying to justify computer screen time to making profits.

I can't be bothered with all that frankly given that it is extremely time consuming and that every decision is still a less than 50% chance of being correct successful. Success in the sense that it was the correct decision at the right time and price both for entry and exit...let alone correct stop placement and so on.

All I'm saying is, it's perfectly possible to keep playing the bias stake game until you reach a point of profit overall. It doesn't mean that we have to keep on adding trades ad-infinitum. We can always close off profitable trades when we decide the bias has shifted to the other side, and maybe back again and so on. It's just totally flexible in that sense.
 

Sigma-D

Established member
648 62
I don't see how any amount of focus will help if the basis for which you're employing the focus is flawed. Having a trading method which has a consistent edge would seem to come ahead of focus. And I'm not even sure you'd need the latter with the former.

And money management - a similar view. Doesn't matter how well you trim your losers and let your winners run/pyramid up - if you've got a net losing method no amount of money management will protect your capital.

counter_violent's point about coin toss and 50/50 is interesting. I've set trades to open with a default 15 pip stop and 15 pip target. I further only took trades inline with what I perceived at the current trend (slope of price line and position with respect to a medium term moving average). I still get far more losers than winners. I haven't gone as far as basing trades on a coin toss, but even then, I suspect if I did with similar 15:15 or N:N stop/target levels, I'd still get more losers than winners - not 50/50. Why is that?
 

Trader333

Moderator
8,655 981
I suspect if I did with similar 15:15 or N:N stop/target levels, I'd still get more losers than winners - not 50/50. Why is that?

Commission or spread will affect this.
 

tar

Legendary member
10,443 1,313
BTW trading based on a coin toss wont necessarily give a 50% win rate , i don't understand how people came to that conclusion the outcome of the coin toss heads or tails yes it is 50/50 but that's irrelevant when it comes to trading based on that outcome .
 

counter_violent

Legendary member
11,280 3,005
I don't see how any amount of focus will help if the basis for which you're employing the focus is flawed. Having a trading method which has a consistent edge would seem to come ahead of focus. And I'm not even sure you'd need the latter with the former.

And money management - a similar view. Doesn't matter how well you trim your losers and let your winners run/pyramid up - if you've got a net losing method no amount of money management will protect your capital.

counter_violent's point about coin toss and 50/50 is interesting. I've set trades to open with a default 15 pip stop and 15 pip target. I further only took trades inline with what I perceived at the current trend (slope of price line and position with respect to a medium term moving average). I still get far more losers than winners. I haven't gone as far as basing trades on a coin toss, but even then, I suspect if I did with similar 15:15 or N:N stop/target levels, I'd still get more losers than winners - not 50/50. Why is that?

I once did a study of a clear down trend move over a period of a few weeks on USD CAD
It was simply counting up and down candles on all time frames from 1m through to 1 day.
The findings were interesting to say the least. On all time frame counts up to 1 day, up v down candles were roughly equal in number. It was only when we got to 1 day count that the percentage started to bias in the direction of trend. Roughly 53% down v 47% up.
 
Last edited:
1

12WBT

0 0
Don't you think that the money management should have been considered before entering the trade? Tossing coins is random, so each closing trade will decide how much further to go with that procedure and what loss can be tolerated on each trade.

If you do 30 trade's in an hour for example.
Maybe you are trading the outcome without looking at the money management.
You can keep a score in your head of the points/pips made or lost.
Then when the work is complete you can look at the account balance.
 
1

12WBT

0 0
Well, for those who want to sit there all day focussing and timing trades, then that's fine. But in my experience, there is a danger of trying to justify computer screen time to making profits.

I can't be bothered with all that frankly given that it is extremely time consuming and that every decision is still a less than 50% chance of being correct successful. Success in the sense that it was the correct decision at the right time and price both for entry and exit...let alone correct stop placement and so on.

All I'm saying is, it's perfectly possible to keep playing the bias stake game until you reach a point of profit overall. It doesn't mean that we have to keep on adding trades ad-infinitum. We can always close off profitable trades when we decide the bias has shifted to the other side, and maybe back again and so on. It's just totally flexible in that sense.

Agree it is very labour intensive and not for everyone.

But surely if do this type of work over a long period.
You are better than a coin toss.
 

Sigma-D

Established member
648 62
Commission or spread will affect this.
No trader333, it doesn't.

Try it for yourself.

Select an instrument at random.

Select a point in time at random.

Enter long or short at random with the stop the same distance form the target.

I f you have more losses purely because of the spread I'll eat my hat and take sonic out to dinner. (And then on up to Brokeback for a cowboy weekend. I don't care how pretty his gf is, we all need the real stuff now and again...)
 
 
AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock