Greed or being in tune

[trendie]

Interesting week.
Having settled down to making 60 pips a day from GU and EJ, I find myself re-assessing my targets. Especially as the potential has pretty mega recently.

Now, the reason I originally settled on 60 pips was that I found a reliable 60 pips was less stressful than an open trade, not knowing where it would end.
With trend-following, you get many, many mediocre or scratch trades, and rely on some big move to bring in the money.
Going for a reasonable daily target was, and is, a much more relaxed affair.

However, taking a 30 pip gain, (getting my target in 2 decent trades) recently has got me getting greedy and feeling as if I've missed out.

I know the robust, daily grind is far, far better than relying on the occasional outlier, but wonder if my thoughts are born of greed.

Do you trade to squeeze the last pip out of a move, or are happy to have come out positive out of a move, and feel no pang if the move then goes on significantly further?

By jumping out too early am I failing to get in-step with the market?
Am I out of tune with the market?
Or am I being greedy?

 

[oiltanker]

increase size? or stops on larger tf?

if adr on ej is 160 then a conservative 25% =40pts

 

[wackypete2]

I have found that in todays market taking smaller gains works better for me. Overall volatility across most markets that I trade is near or at record lows which makes the homerun wins harder to find. There is no one size fits all and you have to adapt to whatever the current market is giving you. My trading today is much different than just 3 or 4 years ago. When I exit with a winner there is no crying if I then missed out on much more. It happens just as losses do. I often exit early if the price is close to my target but stalling. For me in the past year this has been beneficial more often than not, but a few years ago I would have waited it out and again, more often than not, it worked. I trade mostly forex and some ES these days and IMO getting in and out quickly with a small but reasonable gain is the way to go.


Peter

 

[shadowninja]

I just accept that I cannot pick the start and end of a move - because I know I'm no trading god but if I can keep a level of consistency and overall grow my account then I'm happy.

 

[SvenFoster]

if your trendfollowing and with a lower frequency then of course you need to wring out every pip.

If your trading with a daily target you should be content with consistancy and taking money off the market everyday.

if its working dont knock it

 

[meanreversion]

Trendie, how long did you attempt trend following? What made you ditch it in favour of attempting a daily return?

I'm trading a trend system which has been so-so this year. I originally started off FX only, but a month or two back extended it to include commodities, energy and grains. Diversity is the name of the game - the more markets you trade, the more chance of finding the home run. Despite fairly volatile daily mark-to-market, monthly returns have been fairly steady so far (that's probably just a coincidence tho).

Trading the system is devoid of excitement in the sense that, once the positions have been entered, there is not a lot to do. However, there is some entertainment in that there are always open positions, thus daily equity swings can be decent.

I'm really not feeling the need to start trading intra-day. I don't mind low frequency trading, as the cost of doing business is low. How did the process evolve your side?

 

[trendie]

wp2:
after a bad Feb/early March, I also reduced my take. but the pips remained the same, just I took 20-30 per trade, rather than trying to hold on to a 60 pipper in 1 go. Actually this feels better.

mr:
I have always been a trend-follower. but, rather than waiting for a big run, I have found that pocketing a decent run, I found that taking a couple of 20-25 pips seemed much easier than taking a trade, then watching it move against me, then with me, then against me, etc.
since I have been fine-tuning my entries (as a reaction to the poor Feb), I found that a quick 20-30 pips feels relaxing. money snagged and bagged. pressure off.

however, as a sort of variation to "I dont know what I am doing" thread, I wonder if I am subtly veering away from "true" trading. I mean, I am taking a bite, then running away.
However, the reliable daily pips is preferable to being a trend-follower, even though I am a trend-follower!

Dont worry, this is just my occasional moment of losing my confidence, and wondering what the hell I am doing.

oiltanker: yes, increasing size is the way. donaldduke first suggested this. and, weirdly, knowing that I have a robust system, means bigger size is easier. but, I am taking this slowly.

 

[leovirgo]

Interesting week.
Having settled down to making 60 pips a day from GU and EJ, I find myself re-assessing my targets. Especially as the potential has pretty mega recently.

Now, the reason I originally settled on 60 pips was that I found a reliable 60 pips was less stressful than an open trade, not knowing where it would end.
With trend-following, you get many, many mediocre or scratch trades, and rely on some big move to bring in the money.
Going for a reasonable daily target was, and is, a much more relaxed affair.

However, taking a 30 pip gain, (getting my target in 2 decent trades) recently has got me getting greedy and feeling as if I've missed out.

I know the robust, daily grind is far, far better than relying on the occasional outlier, but wonder if my thoughts are born of greed.

Do you trade to squeeze the last pip out of a move, or are happy to have come out positive out of a move, and feel no pang if the move then goes on significantly further?

By jumping out too early am I failing to get in-step with the market?
Am I out of tune with the market?
Or am I being greedy?

similar to my dilemma. I took nothing short of 40-60% of Daily ATR back in the winter, now I am reducing stoploss and targets have been reduced (10pip stop for 20-30pip gain therefore it is at least 2R return).. like you, this also happened after not-so-impressive Feb results.

the name of the game is 'flexibility', unless one is prepared to sit out drawdown months that are bound to happen if only one method/strategy is used, as nothing works in all market conditions... therefore, I settle for small wins.

the amazing thing though, is I get more pips when I reduce targets. after a month or so, I get greedier when I start to see runners that easily go 60-80% of daily ATR..

content-greed cycle continues..

 

[price777999]

why not take +60 profit on one contract and move your stop on the other .then you get the best of both worlds .

 

[montmorencyt2w]

By jumping out too early am I failing to get in-step with the market?
Am I out of tune with the market?
Or am I being greedy?

I'd call that being pragmatic, not greedy.

 

[trader_dante]

Sorry if this sounds a bit basic but isn't the whole point of trading, to get out when you think the move is over?

I would never exit just because it had moved 30 pips or 60 pips or whatever.

If I am long for example, I stay long until I look at the chart and no longer think it's a buy.

Incidentally, this decision to exit has no relation whatsoever to the price I got in at.

 

[meanreversion]

I've found trailing stops to work better in backtesting ... rather than trying to impose an artificial profit target on the market, why not just stick with the winning trades when they're going well, until such time as the trend reverses. The trend is your friend until the bend at the end, someone once said.

 

[Mr Flibble]

My advice to you would be this. As soon as you hit your target place a stop loss 5 pips below and now trail it upwards. Every 10 pips move it up again and again. Surely better to do this. My exits are usually based on when I see the price bounce off a level. This means I watch purely the price action as soon as it bounces off a level by 2 points or more then I'm out. You can see this happen many times whereby a price reaches a level and will bounce off then try to retest and bounce off again before the mini trend is reversed. If you're on the ball you will bail at the 2 retest at the highest possible level. The more I trade the more I would love to have L2.