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How to recover equity from heavy losses? 40 replies

Do you believe tight stop-losses cause losses in the long run? 76 replies

Do you believe fixed stop-losses cause losses in the long run? 16 replies

Are you a small speculator? Then I know where your Stop Losses are! :) 11 replies

How do you recover your losses?

  • Post #1
  • Quote
  • First Post: Apr 2, 2007 6:52am Apr 2, 2007 6:52am
Any idea would be appreciated. Thanks.
To me, low risk and high reward is key. Suppose you are risking 2% of your capital every trade, and you lose 10 in a row.

Your account would drop to 80%. But suppose each winning trade would increase your account 10%. You would only need 2 winners in a row to break even.
i dont place stops so my broker doesnt hunt them,...
its just money
You never recover your losses.
A (closed) loss is a loss and you can never change that. It will forever be a negative on your balance sheet.

I don't have a 100% system.
Therefore;

The objective is to develop a system that not only gets you out of incorrect trades at minimal cost but also gets you into the trade at the correct time as to move quickly into positive territory.

Waiting is not a Waste of Time.
You never really recover them?
How about if you have found a system and get back all the losses. But I know it will take a while.
this is a stupid thread.

trading without a stop loss is death.
trading with a tight stop loss is death, too.

the word "recover" rings in my head as "more losses".

oh my god oh my god my broker is hunting my stops!!! what should I do? (especially on my 50k demo account). haha.
Quoting ragxyz
You never really recover them?
How about if you have found a system and get back all the losses. But I know it will take a while.
Your approaching the subject from the wrong context. While it's true that at some point a profitable system will "recover" all your previous losses, that is not it's intended purpose. The intended purpose of a profitable system is to generate a profit over time.

There is nothing wrong with keeping a running total of your net P&L from the time you started trading. In fact you SHOULD because at some point you will get to experience the unbridled joy of crossing over from net loser to net winner. Just don't let that objective become your driving motivation to trade. Trade only when you have a statistically advantaged opportunity to profit. If you do that all your losses will take care of themselves.

Luck be with you.
trading without sl, can be one of the most profitable, let me share you why, if i may ofcourse

1. if u play breakouts, u enter with a SL, if u got filled, it goes in 99% in the predicted area, u dont need SL, only to protect the profits.

2. If u dont use SL for its purpose, u are 99% more carefull where 2 enter the market,...u check MA, Fibos, PARs etc....not just place 2 orders & HOPE it turns your way

3. If u dont place SL, your broker can not move the market in news time & when the liqudity is LOW, summer time, holidays ETC.

Maybe ur broker cant hurt a fly, but mine can and it will, especially if u are a scalper by the way its WELL written in terms of use, at my broker. Ofcourse if u got small account its a must.

Enogh wisdom.
its just money
Quoting de123
trading without sl, can be one of the most profitable, let me share you why, if i may ofcourse

1. if u play breakouts, u enter with a SL, if u got filled, it goes in 99% in the predicted area, u dont need SL, only to protect the profits.

2. If u dont use SL for its purpose, u are 99% more carefull where 2 enter the market,...u check MA, Fibos, PARs etc....not just place 2 orders & HOPE it turns your way

3. If u dont place SL, your broker can not move the market in news time & when the liqudity is LOW, summer time, holidays ETC.

Maybe ur broker cant hurt a fly, but mine can and it will, especially if u are a scalper by the way its WELL written in terms of use, at my broker. Ofcourse if u got small account its a must.

Enogh wisdom.
(Snicker)
Have you read about the martingale and anti-martingale strategies? The martingale is an old gambler's strategy which says you double up your bets each time you lose so that you'll recover your losses, e.g. in a game of roulette you lose your first bet of $5 and follow it by a bet of $10, which you also lose. When you win your third bet of $20, your $40 winnings gives you a gain of $5 plus your first two bets back. The trouble with this approach is that it only works if you have really deep pockets, as luck can go against you for a really long time. You can apply the same logic to forex trading, and increase the size of your positions as you are losing.

The anti-martingale approach says the opposite, i.e. as you win you increase the amount risked and as you lose scale it down. A fixed percentage money management approach is an example of this strategy, and is generally agreed to be a better long-term strategy for success. The goal of the anti-martingale is to protect your capital from further losses rather than to recover the ones you have already made.
Quoting piccolo
this is a stupid thread.

trading without a stop loss is death.
trading with a tight stop loss is death, too.

the word "recover" rings in my head as "more losses".

oh my god oh my god my broker is hunting my stops!!! what should I do? (especially on my 50k demo account). haha.
Please refrain from describing others' threads as stupid. Victor Neiderhoffer doesn't use stop losses and he has more than $50K in his account. It was his lack of an exit strategy that cost him everything in '97, but he still maintains that stop losses are devised to steal traders' money. Forex factory is a community of supportive members. Lets not put each other down please.
As a professional stop hunter I can assure you that your decision to enter a stop loss order doesn't make the slightest difference in determining whether you will be smoked out of your trade or not. If you are a technical trader people like myself know EXACTLY where your stop is, mental or otherwise.

Failing to enter a physical stop order will only serve to tempt a trader to break his/her rules.
Quoting dunningduke
Please refrain from describing others' threads as stupid. Victor Neiderhoffer doesn't use stop losses and he has more than $50K in his account. It was his lack of an exit strategy that cost him everything in '97, but he still maintains that stop losses are devised to steal traders' money. Forex factory is a community of supportive members. Lets not put each other down please.
I don't use SL too.

My ROE each month is 100%....
Er, in all fairness pablopr has posted that he risks 20% of his account for scalp trades in another thread.

Isn't there a risk of a margin call if the market suddenly moves against him, especially with no stops in place? Too dangerous for my blood, but to each their own....
  • Post #15
  • Quote
  • Edited at 3:31pm Apr 2, 2007 2:43pm | Edited at 3:31pm
I'm still testing this idea so I'm not sure if it will work out.

Use no SL, instead enter a hedge if price brakes a significant support/resistance level. You will be amazed at how many times price will turn over and hit your TP. You will need to manage the hedge accordingly, for example exit the hedge on a false break-out.

This goes for short-term trading.

Good luck
  • Post #16
  • Quote
  • Last Post: Apr 2, 2007 3:52pm Apr 2, 2007 3:52pm
Oh, Come on guys.

to quote some unrelated numbers... 95% will follow because, as yet, they do not know how to lead.

Wanna be a Leader {winner} Then Quit Followin' the Crowd {long term trends acccepted as possibly biased and true}. Sometimes you are a part of the crowd {"Trend Friendly" Sometimes {Generally comes later} you realize the Crowd is wrong. BIG OPPPORTUNITY This includes someone who will sell you the map to the "Indiana" Grail.
Self Bio:
Follower [ ]
Leader [ ]
Independant [ ]
A very incomlpete post but still designed for you to keep your money.
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