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Trading Without a StopLoss

  • #2,021
  • May 16, 2014 6:28am May 16, 2014 6:28am
Quoting MrShaun
During my early trading days, the lack of stoploss was the cause of my account being wiped out within a week. I have now set my stop loss to target price ratio to at least 1:2
If you can blow an entire account in a week one of two things is happening:

(1) You're trading way bigger than you can afford to.
(2) You don't have enough money to be trading.

There's nothing inherently wrong with using a stop loss but setting all your stop losses and take profits at 1:2 doesn't change the fact that you can still lose. It just might take a little longer.
  • #2,022
  • May 16, 2014 7:21am May 16, 2014 7:21am
Quoting 60minuteman
{quote} Hi pip, it's nonsense the broker triggering stops by moving price, banks may position themselves to find the liquidity to fill a clients order by using it's funds, but your broker is certainly not doing that. If on the other hand the broker is slipping your orders then just move to another broker. Have a look at this video, it will give you a good feel for what is really going up further up the chain... good luck and don't take too much notice of retail chatter, our main advantage is we don't have to follow any rules and can still make money...
I'm just paranoid I guess, the man is trying to bring me down hahaha. Thanks for the advice and the video!
  • #2,023
  • May 16, 2014 7:46am May 16, 2014 7:46am
Quoting Rap Skallion
Are you sure it was because you traded without stop loss, or was it because your lot size was too large? I started out with stop loss and lost money. Tried 1;2 r r ratio and lost money. Tried fibonacci schemes and stochastic , with stoploss and lost money. Went to what I thought were tiny lot sizes and started leveling out. Went to trading 19 pairs and started making consistent money. I close trades in loss when I need room with margin for more profitable trades. I go shopping for the cheapest trade per lot size that won't make money soon and close...
Boy would I love to sit down and have a talk with you. We are very similar. You have a good way of explaining it.
  • #2,024
  • May 16, 2014 7:49am May 16, 2014 7:49am
Quoting nanningbob
{quote} Boy would I love to sit down and have a talk with you. We are very similar. You have a good way of explaining it.
Thanks> I agree: we are very similar.
  • #2,025
  • May 16, 2014 8:06am May 16, 2014 8:06am
Quoting pipcipher
{quote} I'm just paranoid I guess, the man is trying to bring me down hahaha. Thanks for the advice and the video!
you will be your biggest enemy in trading, I suggest looking up Denise Shull's videos too, they will be beneficial
tradewith60
  • #2,026
  • May 16, 2014 11:09am May 16, 2014 11:09am
Quoting nanningbob
{quote} Boy would I love to sit down and have a talk with you. We are very similar. You have a good way of explaining it.
I've been following the conversations between you both as I too can relate to the trading mentality you both adhere to. I have tried it all, looking for something "guaranteed". Then one day I just started trading, and trading lot sizes that don't make me lose sleep. I take profits continuously when I have them, but I also keep some losing and winning trades open. I generally close my losing trades on a good day/week/or month where I can still show a profit for the day/week/month while getting rid of the bad trade. Ideally, if my floating equity is positive I am in a good place, and have some "backup" in case a new trade goes bad, I can balance it out if need be.
  • #2,027
  • May 16, 2014 11:21am May 16, 2014 11:21am
Quoting Rap Skallion
Are you sure it was because you traded without stop loss, or was it because your lot size was too large? I started out with stop loss and lost money. Tried 1;2 r r ratio and lost money. Tried fibonacci schemes and stochastic , with stoploss and lost money. Went to what I thought were tiny lot sizes and started leveling out. Went to trading 19 pairs and started making consistent money. I close trades in loss when I need room with margin for more profitable trades. I go shopping for the cheapest trade per lot size that won't make money soon and close...
Great post.Now this is what trading is all about.No bullshit, just grab hold of a bargain and keep hold of it until its no longer a bargain.Why does trading have to be any more complicated than that.No need for S/L if you're cute with your lot sizes, and be honest with yourself and get rid of toxic trades. A lot of truth in the old idiom " Where price is now, it will be again"
Where price is now, it has been before, and will be again.
  • #2,028
  • May 16, 2014 9:03pm May 16, 2014 9:03pm
Quoting Jenx
{quote} Great post.Now this is what trading is all about.No bullshit, just grab hold of a bargain and keep hold of it until its no longer a bargain.Why does trading have to be any more complicated than that.No need for S/L if you're cute with your lot sizes, and be honest with yourself and get rid of toxic trades. A lot of truth in the old idiom " Where price is now, it will be again"
3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of your income. It was based on the simple fact that you believed over a period of time the stock would go up. No one was putting in SL or going for fractions of penny profits. You just bought in small increments and eventually you were on the winning side. Some entrances going profitable sooner than others. The key was to just keep buying into the trend.

Forex is different in that there is no such thing as a currency going up forever or going down forever. What it does is range between two points as business takes place. If you study the monthly charts and go back 20-40 years you can see that price stays with a certain range with a couple of exceptions. For example the eur/usd for the last 15 years has stayed between 1.25 and 1.50 with the exception of a handful of months in 2008. It stays in a range. Knowing this you trade that range. Going up with it until it gets above 1.40-1.50 and go down with until it goes below 1.25-1.30. You play those ups and downs inside that range and you can be a very successful trader. In the last 7 years there have been 11 major trend changes in the euro. All you have to do is follow those long term trends. I actually take more SL than I need too and that is mainly because I have a tendency to overtrade playing with smaller lots and I have to close some out if my total trades to account size starts getting to big. When you have 20-40 trades going at all times every day I can take a profit, several times a day. Occasionally when I see the trend direction has changed on a currency I close out and start the other way.

They snickered and laughed and mocked but every month my account grows and after several years of trading I have taken back my original investment out a long time ago and have been playing with house money. No more beating myself up about my entrances and exits, no worrying about leaving the computer on all night or going out. No more worrying about news stories or avoiding news events. When I travel and fly overseas back and forth from Asia to the USA and back I dont have to close out my trades and restart. I land get a good nights sleep and check my computer. AHHHHH look at all those trades that went into profit. One time there wasnt any and I set my next set of trades as I caught all the reversals back to the median. Day in, day out, week in, week out, month in, month out, year in, year out: over and over and over my DD is statice between 0-10% occasionally going to 20% (thats when I cant believe a currency is changing direction and get stubborn) but at 20 I take that 3-7% loss and continue on.

The only thing that matters is my account balance keeps growing and occasionally I have to use my profits to close out some negative trades. DD is static year after year but the account balance grows. It is like interest every month being applied to your account. 5-10% every month. 5% a month over 3.5 years equals 7X your original account balance. If you dont understand compound interest and how it grows money over time you wont understand this. If you do and can understand that trading ten or twenty cent trades on 10K of account can constantly accumulate an a account to grow to 70K in 3.5 years then trading seventy cent to one dollar and half per lot and build to 490K in 7 years, etc. You then begin to understand that a frozen or fixed DD in the 5-15% doesnt bother us you can then begin to grasp how we trade. We may not use the same trading methods and you can be like Hanover and argue to your blue in the face that you can trade the same way using single trades (you really cant, it wont work using SL). The reason it is so difficult to trade with tight SL is when you close the loss you face the same problem. It is like negative interest, instead of a floating loss that never accumulates you are accumulating losses that act just like interest on your account and it slowly or quickly drains it away.

The bottom line is I went to bed at the beginning of the USA session on Friday and wont touch my account until Monday. I had nothing to worry about. No matter what price did I will be able to trade again on Monday.

I trade in a way that allows me to trade again the next day.
I trade in a way that allows me to sleep all night, take multiple day trips away from my computer, watch a movie on TV when NFP happens every month. Occasionally when I am convinced a currency has changed directions then I close out and start looking for my best trades the other way. When you finally get really really really frustraded with trading. Go to a monthly chart, find your direction, got to a daily, 4H or 1H chart trade in that direction. Then put a 1000 dollars in a account and trade 1 penny lots. When price goes against you 100 pips and its 1 dollar in the hole you go thats nothing. When it goes 1000 pips in the hole and its 10 dollars down you wonder what everyone at FF is getting all excited about. However, since you followed the long term trend you start getting 200 pips here on one currency during a week, and 300 on another and 150 on another and you enter into a trend with mutliple positions and instead of getting 200 you learn how to get 3,4,500 pips on one currency in a week and some SL nut is screaming but you are down 200 pips on some currency but you pocketed 500,1000, 2000, pips on others. You go SOOOOOOOOOOOOOOOOOOOOOO ...................

There are people beginning to understand this about Forex trading. They see that you play the ranges, the long term trends, you trade small lots and in 3 years you are trading ten to twenty cent lots and you now have 7000 in your account and the same bozos are still arguing with you that you are not a trader and you dont know what you are doing and ............................ meanwhile the brokers cant margin you out, SL you out, spike you out, increase your spread and force you out of the market, and they are on the hook for your profit at some point. They hate us because the only profit they will get out of me is the pip spread. You wonder why bluesteele, nubby boy, (I would never put Hanover in this group) come here and spill their vile language all over the screen making sure you dont follow this small group of profitable traders that get it. Some day at some point you will understand the guys who trade with million dollar accounts trade small lots to account size, low leverage, use multiple entrances, follow long term trends, and never trade in a way that puts their account balance at risk. I finally learned those lessons and 3-4 more years of this and I retire. Have a good day.
  • #2,029
  • May 16, 2014 9:16pm May 16, 2014 9:16pm
Quoting nanningbob
{quote} 3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of...
Intriguing post. I would love to hear more!!!
  • #2,030
  • May 16, 2014 9:20pm May 16, 2014 9:20pm
Quoting nanningbob
{quote} 3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of...

Great post man, I was thinking about doing something like this at some point, but for now it doesn't fit with my frame of mind. But it's glad to know that others are doing the same thing.Good luck, always good to hear someone who is outside the box looking in on at the rest of us.
Being a trader is lonely, but being a great trader is lonelier still
  • #2,031
  • May 16, 2014 10:15pm May 16, 2014 10:15pm
Quoting Winston Reed
{quote} Intriguing post. I would love to hear more!!!
I posted this earlier but I will put it here again.

Think of it this way. There are traders who do not use their entire lot size in one entrance. They break it up into 3 parts and enter on multiple levels. Let us say you like trading 3 lot sizes. Instead of entering all three at once you enter them as 1 lot size at 3 different spots. This allows you the flexibility to find the spot you want to enter in. Let us say you enter one lot but some sudden news story breaks and give a pair a 2 or 3 day reversal. Well when that run is done you can enter your 2nd lot and then the third at a retracement. You phase in your lot size. This also helps in case you are just plain wrong. Instead of taking a 3 lot loss you now only take a 1 lot loss not having played your whole position. To me this really helps your money management in that you still play your 3 lot size on winning trades but not on your losing trades, unless you have really blown your entrances. If you can grasp the basic principle and follow long term trends then you can make most all your trades profitable. I am a fan of small lot size to account size so as to make trading a relaxing and sometimes boring affair. The concept that you can make pinpoint entrances when you are dealing with a hundredth of a penny move seems ludicrous to me. Give yourself some space and allow trades time to become profitable. Most currencies really only change direction a handleful of times a year you just need to give yourself the room to stay with a price trend. Check your monthly charts and you will see what I mean. Good luck.
  • #2,032
  • May 16, 2014 11:50pm May 16, 2014 11:50pm
Quoting nanningbob
{quote} There are people beginning to understand this about Forex trading. They see that you play the ranges, the long term trends, you trade small lots and in 3 years you are trading ten to twenty cent lots and you now have 7000 in your account and the same bozos are still arguing with you that you are not a trader and you dont know what you are doing and ............................ meanwhile the brokers cant margin you out, SL you out, spike you out, increase your spread and force you out of the market, and they are on the hook for your profit...
Great post nanningbob. This way of trading is a total different ball game than the single entry high leverage style and a much safer way of doing it. Most of the extremely left brain persons missing the forest by staring at the trees simply cannot comprehend this and start with all kind of this is not mathematically efficient kind of stuff. They don't understand the real shortcomings of setting up mathematical models. They don't understand how difficult it is to factor in all the variables in a mathematical model. They don't account for interdependence between variables. All the stuff I have seen thus far is very simplistic single variable explanations and hence probably not even close to comparing two sets of mathematical models. Some even don't realize how difficult if not impossible it is to measure and compare discretionary issues involved in trading. The only thing that most mathematical illustrations in this thread convinced me of is that tree staring is taking place without any view of the forest.
Much depend on luck, but the more you practice the luckier you get! NT & GP
  • #2,033
  • May 17, 2014 2:38am May 17, 2014 2:38am
Quoting nanningbob
{quote} 3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of...
Excellent post. In my opinion, this is the ONLY way you can be profitable long term.
Where price is now, it has been before, and will be again.
  • #2,034
  • May 17, 2014 7:09am May 17, 2014 7:09am
Quoting nanningbob
{quote} 3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of...
What he said!

What he said in spades!

  • #2,035
  • May 17, 2014 12:57pm May 17, 2014 12:57pm
Quoting nanningbob
{quote} Some day at some point you will understand the guys who trade with million dollar accounts trade small lots to account size, low leverage, use multiple entrances, follow long term trends, and never trade in a way that puts their account balance at risk. I finally learned those lessons and 3-4 more years of this and I retire. Have a good day.
Great Post Bob, one of the best I've seen here. Totally agree and I trade a very similar style without using a SL and I live a very nice life from trading this way. I'm sure the Trolls be be along soon but it's refreshing to see this
  • #2,036
  • May 17, 2014 2:20pm May 17, 2014 2:20pm
Quoting nanningbob
{quote} 3 years ago, I got hammered here at FF for teaching some of these things. I decided to spend more of my time at another forum. Since then I have had many PMs and Emails thanking me for publicly sharing such thoughts as others had been trading similar styles. Since then many traders have come out now and wont put up with the garbage posted by a small but very vocal group of trading with a fraction of a penny SL. Decades ago I used to work for Disney world and they had a program where you bought their stock every week using a percentage of...
  • #2,037
  • May 17, 2014 4:41pm May 17, 2014 4:41pm
Quoting nanningbob
{quote} I posted this earlier but I will put it here again. Think of it this way. There are traders who do not use their entire lot size in one entrance. They break it up into 3 parts and enter on multiple levels. Let us say you like trading 3 lot sizes. Instead of entering all three at once you enter them as 1 lot size at 3 different spots. This allows you the flexibility to find the spot you want to enter in. Let us say you enter one lot but some sudden news story breaks and give a pair a 2 or 3 day reversal. Well when that run is done you can...
this is exactly what I do except I usually split up into more than 2-3 orders and hold positions for couple monthsTOTAL but will modify on day to day basis based on overall perception and new information that can impact the market. There needs to be a school or blog site that teaches this as it is truly the way to trade. More focus on exit less on entry!!
All posts are my personal opinion
  • #2,038
  • May 17, 2014 4:59pm May 17, 2014 4:59pm
Quoting nanningbob
{quote} I posted this earlier but I will put it here again. Think of it this way. There are traders who do not use their entire lot size in one entrance. They break it up into 3 parts and enter on multiple levels. Let us say you like trading 3 lot sizes. Instead of entering all three at once you enter them as 1 lot size at 3 different spots. This allows you the flexibility to find the spot you want to enter in. Let us say you enter one lot but some sudden news story breaks and give a pair a 2 or 3 day reversal. Well when that run is done you can...
Thanks. Thinking very hard about this. For me it is definitely out of my realm but perhaps that is exactly what I need to do.
  • #2,039
  • May 17, 2014 6:00pm May 17, 2014 6:00pm
The thing is simply not whether you can take a loss but can you let your profits run?? Playing no stop is easy when you only bag > 100pips,
All posts are my personal opinion
  • #2,040
  • May 17, 2014 6:06pm May 17, 2014 6:06pm
Quoting dare123
Presently, I use Rotational Hedging strategey which does not use stoploss. If you have used it before, Please what is your opinion about it.
Dear Dare123 can you explain it more about your rotational hedging.
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