I Stopped Using Stops

[Oscar Reed]

Now we're getting somewhere. The mention of hedging trades is key to playing the random walk game.

Random walk using small stakes and limit TP will produce better than 70% of trade outcomes, dependant on a reasonable time horizon to close out in profit.

This is not to say that your 70% winners will produce enough profit to counter these DD outlier rouge trades.


The problem is how to deal with these trades that go opposite and show adverse directional movement as opposed to normal market price gyrations.

I have solutions, but would prefer to see others comments in the first instance.

An idea and understanding of current market correlation across different assets
Shares, index, FX(one special creature) , bonds , commodities, etc
Then using the variance for those 30% **** wit trades.

A type of stop but not in the conventional way.
Can you give you more time to work out that trade.
Then looking to work that hedge into a profit, break even or worst case smaller loss.

 

[hhiusa]

Nothing. You?

So everything?

 

[darktone]

So everything?

let me try again.

Im not concerned about anything.

Is that clear enough merican? Hope so cos its all I got for ya

 

[hhiusa]

let me try again.

Im not concerned about anything.

Is that clear enough merican? Hope so cos its all I got for ya

Thank you for clarifying.

 

[darktone]

Thank you for clarifying.

I guess It wasnt clear enough. Dont worry merican, we all understand.

Just a quick heads up, heres an nt post you havent liked yet.

 

[hhiusa]

I guess It wasnt clear enough. Dont worry merican, we all understand.

Just a quick heads up, heres an nt post you havent liked yet.

I like posts that are logical, actually have a point and stay on topic. It just so happens that @new_trader prefers quality over quantity.

 

[darktone]

I like posts that are logical and mirror my own mindset. You see darkie, its a big bad world out here and pretty damn scary place. A fragile ego like mine has to find another, to gratify each other, strength in numbers and all o that. I likey da new_trader! I luffa da new-trader!!

No worries man, I comprende.
Neways
heres another one
and that one
and this one
definitely missed this one

 

[hhiusa]

And heres another one
and that one
and this one
definitely missed this one

They are all absolutely logical and concise posts. I enjoyed re-reading them.

 

[darktone]

I think this is as good a time as any to final up my involvement in this thread, Im starting to get that endless game of circles feeling .

For me this thread was never really about stops, it was about the mindset and thinking that goes behind their use.
First line of defence for the ego when questioned is attack. It usually dont take much prodding to get it snarling and yapping. Youre threatening its very existence right. The bigger the ego the easier it is.

You good folks involved in the discussion ranged from curious to completely unconscious (just my 2c and no its not a spelling mistake). It was fascinating to watch things play out.
The star comment in my book was the notion that a low risk / low draw down / +1% per day, trader, could have their activities described as terrible / unprofessional / low quality. Theres no limits right, this is a mind in full control of its owner in flat out protection mode.

On the other hand, folks who in the past have shown a lot of resistance to various ideas on the psych front surprised me, by being at least in part, seemingly curious.

So what have you learned from any of this? Something? Nothing? Are you more curious about 'other' methods, the mind, or have you been further repelled.
As someone imo rightly said.

Any learning experience is only as good as the learner wants it to be.

How true. You can take lessons from any situation, from anyone, at any time. Or you can discard and continue. The choice truly is yours.

What have I learned from this thread? Ive had a revealing look at the psychology of the guy on the other side of my trade. Fascinating and valuable stuff to me. Perhaps utterly worthless to you!?

Neways.

Its a goodbye for now from me (my self)

And its a goodbye from it (my ego)

Peace and love to all.

That includes you buttmonkey! :cheesy:

 

[hhiusa]

Peace and love to all.

That includes you buttmonkey! :cheesy:

Saying goodnight to yourself. That is a new one. Very interesting post.

 

[tar]

"Past results are not necessarily indicative of future results."

So if a trader's current max DD is 1% it doesn't mean it will stay that way , infact usually the max DD is yet to come , that's why you need to look at the details , not just at statistics these can be gamed - short term - . For example a martingale trader could have a very low DD at the beginning it doesn't make him a great trader !

 

[tar]

Pig parking

 

[tar]

As a rule of thumb, I don't like to quote my own posts. However, I thought I'd add that the fact I've been short the Dax the last few days and am now down -£16k is neither here nor there!








Just a demo play account of course - not real money!

Do you have a stop ?

 

[counter_violent]

As a rule of thumb, I don't like to quote my own posts. However, I thought I'd add that the fact I've been short the Dax the last few days and am now down -£16k is neither here nor there!








Just a demo play account of course - not real money!

Do you have a closely correlated trading instrument that you could be long.....so as to negate the need for a stop on the Dax ?

 

[timsk]

Do you have a closely correlated trading instrument that you could be long.....so as to negate the need for a stop on the Dax ?

Yeah, I do.

It's called the Dax!

 

[counter_violent]

Yeah, I do.

It's called the Dax!

utoh I think long short the same instrument was done to death a couple of yrs back.

http://www.trade2win.com/boards/discretionary-trading/172660-can-you-long-short-same-time.html

 

[tar]

utoh I think long short the same instrument was done to death a couple of yrs back.

Another 40 pages wont hurt ...

 

[darktone]

As a rule of thumb, I don't like to quote my own posts. However, I thought I'd add that the fact I've been short the Dax the last few days and am now down -£16k is neither here nor there!

Just a demo play account of course - not real money!

Ok
Did you take entry at the BO of tues low (10655)? If did, thats real 'sell low/buy high' kinda trading imo.
Do you still want the trade? ie, do you still define it as a short market?
If not and you havent bailed already, what loss do you want to take?
The market has offered as low as 12255 today and is currently 11460
Where do you want to try and take your loss? Above or below that last price?

Regardless of the situation, you can always aim at a price thats in your favor

Or you could add a professional exit to the professional entry and shoot for a cool -£20k. Just stick a stop out there above that last SH at 11640! It could be a great trade!! :cheesy:

 

[timsk]

Ok
Did you take entry at the BO of tues low (10655)? If did, thats real 'sell low/buy high' kinda trading imo.
Do you still want the trade? ie, do you still define it as a short market?
If not and you havent bailed already, what loss do you want to take?
The market has offered as low as 12255 today and is currently 11460
Where do you want to try and take your loss? Above or below that last price?

Regardless of the situation, you can always aim at a price thats in your favor

Or you could add a professional exit to the professional entry and shoot for a cool -£20k. Just stick a stop out there above that last SH at 11640! It could be a great trade!! :cheesy:

Hi all,
screenshot of the trade attached.



So far, it's going swimmingly. I'm thinking of martingaling and adding another £40 p/p short right about now. Plenty of margin left for me to play with! I just need to time the top of this bull run and will place the short as and when negative news starts to come out of Greece.

darktone, c_v and tar - if any or all of you would care to chip in with how you'd manage the trade from here - please do!
Tim.

 

[counter_violent]

Hi all,
screenshot of the trade attached.

View attachment 194156

So far, it's going swimmingly. I'm thinking of martingaling and adding another £40 p/p short right about now. Plenty of margin left for me to play with! I just need to time the top of this bull run and will place the short as and when negative news starts to come out of Greece.

darktone, c_v and tar - if any or all of you would care to chip in with how you'd manage the trade from here - please do!
Tim.

Double up, obviously !