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zero number game zeroing me out!

  • #41
  • Aug 30, 2011 9:52am Aug 30, 2011 9:52am
Quoting kingsurfer
If you are long on the trade and the market become choatic, that is, in an unfovorable or unclear situation , you enter equal lot size short until market returns to familiar territory. It costs you extra spread but your original trade remains intact and you can now sort it out on your own terms. I don't hedge frequently, but its a tool.

King.
thats an interesting hedging strategy, basically you implement a freeze on the trade. psychological or not, that is an edge in itself.

some people use option contracts maintaining their position Delta neutral.

other investors will hedge on inverse correlating currencies, or on ETF

when trading large sums of money, you really begin to understand the aspect risks reduction via hedging.
simply taking a 500,000 dollar loss, might not be a good idea
AVT INVENIAM VIAM AVT FACIAM
  • #42
  • Aug 31, 2011 10:18am Aug 31, 2011 10:18am
Quoting the redlion
thats an interesting hedging strategy, basically you implement a freeze on the trade. psychological or not, that is an edge in itself.

some people use option contracts maintaining their position Delta neutral.

other investors will hedge on inverse correlating currencies, or on ETF

when trading large sums of money, you really begin to understand the aspect risks reduction via hedging.
simply taking a 500,000 dollar loss, might not be a good idea

I cannot comprehend the number as a loss, $500,000 is 2 x my mortgage but risk related if it represented a 1-2% risk then taking may not be that difficult. Im not a hedger by any means and it is not something I have ever consider, quite possibly because my trading account and risk levels dont involve great pain when cutting a trade. That number brings pain to my mind however had I something in the realm of $20-30M then it just represents a Ferrari I could have purchased
  • #43
  • Sep 1, 2011 10:49am Sep 1, 2011 10:49am
Ok, personally i believe no one is trying to stop us (the shitty and broke retail investors) out. they are just trying to push their positions as positive as possible. and if a huge cloud of stops is sitting at a price level, then you can expect anyone who isn't in a trade to try and trigger it.

We as the retail traders are just collateral damage. central banks and fund managers battling it out on the SPOT are just trying to pick whose going to win the big boy investor battle
  • #44
  • Sep 2, 2011 4:50am Sep 2, 2011 4:50am
George Soros, the legendary investor, never uses a stop order. They were hit too often. When a position went against him, he just closed it .

I don't recommend doing this, unless you know what you are doing...
go go go
  • #45
  • Sep 2, 2011 4:58am Sep 2, 2011 4:58am
Yeah, but I don't think he uses a retail market maker account and MT4 for trading.
  • #46
  • Sep 2, 2011 5:01am Sep 2, 2011 5:01am
If you cannot trade profitably WHILST using stops you shouldn't even consider trading with real money, others DO trade profitably using stops, you just haven't cracked it yet.
  • #47
  • Sep 2, 2011 3:27pm Sep 2, 2011 3:27pm
Quoting jag1966
If you cannot trade profitably WHILST using stops you shouldn't even consider trading with real money, others DO trade profitably using stops, you just haven't cracked it yet.
Or if you can trade profitably without stoploss you have cracked it!

Take one example-the broker. He does not use a stop loss. Yet he is more profitable than the vast majority of traders who invest all their time studying where to place one.

Or do you also think the broker has not cracked it yet?

Stoploss is not a necessity for profitable trading.

It is not the only way to manage a losing trade. Some would even consider it the most expensive of all the options.

King.
  • #48
  • Sep 2, 2011 4:15pm Sep 2, 2011 4:15pm
Psychology aside the only difference between trading with or without stoploss is the actual ability to manage the trade in real time from start to end. If you can do it you don't need a stop loss. If you have redundant Internet connections and employees who will manage all trades 24/7 you don't need a stop loss. If you are a retail trader trading from home or private office and have to take into account blackouts, connection failures, sudden necessity to take a dump or wife who needs you take out trash like RIGHT NOW! - you need your stop loss.
  • #49
  • Sep 2, 2011 7:32pm Sep 2, 2011 7:32pm
Quoting Giansar
Psychology aside the only difference between trading with or without stoploss is the actual ability to manage the trade in real time from start to end. If you can do it you don't need a stop loss. If you have redundant Internet connections and employees who will manage all trades 24/7 you don't need a stop loss. If you are a retail trader trading from home or private office and have to take into account blackouts, connection failures, sudden necessity to take a dump or wife who needs you take out trash like RIGHT NOW! - you need your stop loss.
Sure, some people trade this way- fast and furious. They need a stoploss. Infact, they need a very tight one or they blow their account in seconds. Whenever the market sneezes they hit an emergency stoploss. Then they start complaining of stop hunt when the market turns around almost immediately. Talk of emergency, unplanned, overleveraged trades!

Wheras for others, when the market sneezes, they hit a take profit. They have plans, in advance, to sort out real losing trades. Not fire brigade emergency stoploss ...Plan A, Plan B, Plan C aimed at loss reduction as necessary. Well thought out, proper sized trades.

Now compare

Trader A -Stop Loss happy.
-When the market is rational you take a profit.
-When it is equivocal you take an emergency loss
-When it is irrational you happily take a full loss.

Trader B -Calm, many options enabled.
-When the market is rational you take a profit.
-When it is equivocal you take an 'emergency' profit
-When it is irrational you fight to reduce the loss.

The market tend to be equivocal most of the time. Obviously, Trader B will more likely survive long term.

Stop loss is the least profitable way to manage a well planned, correctly sized trade.

King.
  • #50
  • Sep 2, 2011 7:49pm Sep 2, 2011 7:49pm
i do agree that if you need a stop loss you are not properly managing your trade.


there are 2 approaches to trading, the guy who puts a SL, and TP risking only 1% with R:R ratio of 2:1 he thinks he is being a good trader. in fact this is b/s
most people that trade this way lose money, including myself when i did not know what the heck i was doing

i put a stop loss beyond a S/R point (sounds familiar?) and calculated my R:R and put a TP target. closed the computer so i wont be psychologicaly psyched out, and went on my way.
i was wrong=loss
i was right but wrong timing=loss
i was right but somehow there was a spike=loss
i was right but it did not reach my tp=loss

i just could not figure out why i always lost, seemed like my dealer was playing with me.


managing a trade and actually calculating market probabilities, while using flexible money management, has been the key to my success
AVT INVENIAM VIAM AVT FACIAM
  • #51
  • Sep 2, 2011 9:04pm Sep 2, 2011 9:04pm
Quoting the redlion
managing a trade and actually calculating market probabilities, while using flexible money management, has been the key to my success
Redlion, I always knew hanging around you is a goldmine. Just a matter of time and you will spill it all.

King.
  • #52
  • Sep 3, 2011 1:43am Sep 3, 2011 1:43am
I still can't see how using a stop loss precludes flexible money management but I am not going to quarrel with you - you are obviously much more educated and experienced in this stuff than me.

And there is still the question of the situation when you are wrong - what happens when market starts telling you you are wrong just at the moment when your Internet connection goes bust?
  • #53
  • Sep 3, 2011 3:12am Sep 3, 2011 3:12am
Quoting kingsurfer
Or if you can trade profitably without stoploss you have cracked it!

Take one example-the broker. He does not use a stop loss. Yet he is more profitable than the vast majority of traders who invest all their time studying where to place one.

Or do you also think the broker has not cracked it yet?

Stoploss is not a necessity for profitable trading.

It is not the only way to manage a losing trade. Some would even consider it the most expensive of all the options.

King.
Actually I conceed that anyone that can trade profitably without a stoploss is potentially a far better trader than those that need stops, however VERY FEW people will ever get to that stage and I am certain if they try they will fail and fail with HUGE losses.

All I am saying is that trading with tight stops can be done and when mastered negates all the stress and time wasted, "managing" a trade.


There is absolutely no stress, placing a trade with stops and targets then walking away.
  • #54
  • Sep 3, 2011 3:16am Sep 3, 2011 3:16am
Quoting the redlion
i do agree that if you need a stop loss you are not properly managing your trade.


there are 2 approaches to trading, the guy who puts a SL, and TP risking only 1% with R:R ratio of 2:1 he thinks he is being a good trader. in fact this is b/s
most people that trade this way lose money, including myself when i did not know what the heck i was doing

i put a stop loss beyond a S/R point (sounds familiar?) and calculated my R:R and put a TP target. closed the computer so i wont be psychologicaly psyched out, and went on my way.
i was wrong=loss
i...
If you take the time to work out why your stops always seem to get hit and why your targets never seem to get hit in a straight line you can adjust your stops and tp's accordingly.

It can be done. Price never moves in a straight line for a reason.

Fakeouts, fake-ins and liquidity hunting.
  • #55
  • Sep 6, 2011 3:16am Sep 6, 2011 3:16am
Trading without stop would be a really good idea today
  • #56
  • Sep 6, 2011 8:55am Sep 6, 2011 8:55am
im still with no stop loss.

whats your point?

are you speculating, investing or gambling this is the question to ask yourself.

stop loss is for gamblers, that enter a position and believe the market will move that way, and if it doesnt they get stopped out with minimal loss.

when you manage your position you feel the market move buy how your dealer is quoting you, is he shading you, or widening the spreads.
AVT INVENIAM VIAM AVT FACIAM
  • #57
  • Sep 6, 2011 9:08am Sep 6, 2011 9:08am
I am still not talking about institutional trading where a position can be monitored 24/7.
I am talking about an individual trader who has to leave the trading station from time to time - to make coffee, use the toilet, pick up kids from school - sometimes while in a trade.
If you are not trading that way, if you never lose a running trade from your sight and never leave an open position unattended for a minute, maybe that's ok for you to trade without SL.
I don't believe most traders trade that way though.
  • #58
  • Sep 6, 2011 10:44am Sep 6, 2011 10:44am
Quoting Giansar
I am still not talking about institutional trading where a position can be monitored 24/7.
I am talking about an individual trader who has to leave the trading station from time to time - to make coffee, use the toilet, pick up kids from school - sometimes while in a trade.
If you are not trading that way, if you never lose a running trade from your sight and never leave an open position unattended for a minute, maybe that's ok for you to trade without SL.
I don't believe most traders trade that way though.
i will fade what i consider nothing but bluster from redlion...completely agree with you, giansar.

it makes no rational sense to not use SL, either mental or otherwise. my humble opinion
  • #59
  • Sep 6, 2011 10:46am Sep 6, 2011 10:46am
Quoting the redlion
im still with no stop loss.

whats your point?

are you speculating, investing or gambling this is the question to ask yourself.

stop loss is for gamblers, that enter a position and believe the market will move that way, and if it doesnt they get stopped out with minimal loss.

when you manage your position you feel the market move buy how your dealer is quoting you, is he shading you, or widening the spreads.
Spoken like a guy with less than a years experience trading, you will learn.
  • #60
  • Sep 6, 2011 1:14pm Sep 6, 2011 1:14pm
wow.

every one is so happy gambling away and when wrong taking a loss.

instead of properly assessing market conditions, scaling in with proper position sizes, and managing the risk interactively.

yet im the new guy that will learn.

20 pip stop 40 pip t/p
been there done that. to each his own, in my part as my account grows trading the wrong way. maybe i should go back to trading the right way and see it diminished.

mental stop is not a price.

one should avert further loss when the market shows you, that you are wrong.
if im wrong and my attempt to rectify the position fails, then i will gladly take a loss.

if i can correct my entry, why take a loss in for being rigid.

flexibility is needed in war, flexibility is needed in the market, as prices cannot be predicted.
AVT INVENIAM VIAM AVT FACIAM
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