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Trading Without a StopLoss

  • #2,561
  • Nov 4, 2014 4:42pm Nov 4, 2014 4:42pm
Quoting aed71
{quote} You are right, you can only use hedge on non-NFA markets. This is also a big question mark why NFA forces traders to use kinder-garden rules?
Well, apparently the baldy nobbers on Capitol Hill want me to manage risk "their way" (whatever way that is), even if it puts me at a competitive disadvantage as compared to virtually every non-American trader out there ... . Seems to me if I can drag a burn barrel out to the curb, throw all my money in it, and light it on fire, I should be able to do the same thing with my stock portfolio, forex account, or any other hare-brained investment scheme that I would care to throw my money at ... .

I am not sure why Congress is so keen on protecting the 50% of Americans who are below average intelligence ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #2,562
  • Nov 4, 2014 5:03pm Nov 4, 2014 5:03pm
Quoting ZebraSquirl
{quote} Well, apparently the baldy nobbers on Capitol Hill want me to manage risk "their way" (whatever way that is), even if it puts me at a competitive disadvantage as compared to virtually every non-American trader out there ... . Seems to me if I can drag a burn barrel out to the curb, throw all my money in it, and light it on fire, I should be able to do the same thing with my stock portfolio, forex account, or any other hare-brained investment scheme that I would care to throw my money at ... . I am not sure why Congress is so keen on protecting...
  • #2,563
  • Nov 4, 2014 5:21pm Nov 4, 2014 5:21pm
Imagine Congress passing a law that tells investors they have to buy and sell investments in the same order you purchase them. So if a real estate guru buys property in 2002 2005 2007 20011 2014. He cant sell the properties in 2007 and 2011 until he sold the property he bought in 2002 first, 2005 second, 2007 third, and so on. It is one of the dumbest most idiotic things I have ever come across in investment. To think these guys actually hold positions of power is one of the scariest things I have ever seen. Imagine stocks, bonds, gold, silver, businesses being forced to do business with these jack ass rules. Can you imagine GM cant close the Oldsmobile name brand because they would have to sell off their Chevy division first. Dumb.
  • #2,564
  • Nov 4, 2014 5:34pm Nov 4, 2014 5:34pm
Quoting nanningbob
Imagine Congress passing a law that tells investors they have to buy and sell investments in the same order you purchase them. So if a real estate guru buys property in 2002 2005 2007 20011 2014. He cant sell the properties in 2007 and 2011 until he sold the property he bought in 2002 first, 2005 second, 2007 third, and so on. It is one of the dumbest most idiotic things I have ever come across in investment. To think these guys actually hold positions of power is one of the scariest things I have ever seen. Imagine stocks, bonds, gold, silver,...
Fireworks are fun ... as long as you don't blow your fingers off.
  • #2,565
  • Nov 4, 2014 5:36pm Nov 4, 2014 5:36pm
Quoting nanningbob
Imagine Congress passing a law that tells investors they have to buy and sell investments in the same order you purchase them. So if a real estate guru buys property in 2002 2005 2007 20011 2014. He cant sell the properties in 2007 and 2011 until he sold the property he bought in 2002 first, 2005 second, 2007 third, and so on. It is one of the dumbest most idiotic things I have ever come across in investment. To think these guys actually hold positions of power is one of the scariest things I have ever seen. Imagine stocks, bonds, gold, silver,...
Good examples.

You cannot explain these rules even to a child. He/she would not accept it.

I believe that this is 100% invented to "stop hedging strategies" which might be a big headache for some big players. I have no other explanation.

I really would like to see win/loss ratio of US traders before and after FIFO rules (3 months before and 3 months after)
If u want to be successful, u must respect one rule: Never lie to yourself.
  • #2,566
  • Nov 4, 2014 5:44pm Nov 4, 2014 5:44pm
Quoting aed71
You are right, you can only use hedge on non-NFA markets.
//-----

hey aed..... for those traders here in the states that feel they must hedge in forex, there is always the option to use 2 accounts..... one for longs another for shorts.....

the best solution, for me, was to adapt my trades to a mq5 based theme where all trades are summed into 1.... it took me several years of fighting against to accept that.....

my views on hedging differs so much from the average opinion that i keep them to myself......

merlin once made a $$ challenge to hedgers...... something like give him a set of trades where hedging was used and he could show a solution with less swap and spread paid..... it received a standing ovation with most of the high profile members at that time...... not having ever discussed indepth just what his thoughts were on hedging , i am the dark on his true intent...... so can't comment on it.....

but it's easy to give someone a set of real life trades, placed with a states based broker, placed by a concrete set of rules on verified o/h/l/c data so there is no hanky panky ........ those trades can not be bettered..... it helps to have all closed before 5pm est, so no swap will be incurred.....

thought about baiting some of those more arrogant members into an even more impossible bet...... say like buy and sell every pair at the exact same tick...
that tick would be the first tick following my concrete rules signal.....

as example today, that ea would have had 0 losers..... every trade, buys and sells bought on every pair at the exact same tick would have closed profitably with no swap..... there is no way to better that..... in the chart below shows the results per day for that ea..... lime win.... red lose....

of course, 100% wins does not happen every day as the chart clearly shows..... sundays never work..... the weekly timeframe seldom fails..... but still the ea is not worth running cause the bottom line, at least in my mind, is there are better ways to trade......h
//-----
Attached Image (click to enlarge)
Click to Enlarge Name: 100 hedge.png Size: 53 KB
to trade and code, keep both simple... no call to impress....h
  • #2,567
  • Nov 4, 2014 6:00pm Nov 4, 2014 6:00pm
Quoting hayseed
{quote} //----- hey aed..... for those traders here in the states that feel they must hedge in forex, there is always the option to use 2 accounts..... one for longs another for shorts.....
Yes using two account somehow solves the issue, I've read several posts about it while searching about hedging strategies. However it makes things more complicated as you mentioned. And thanks for the interesting ea chart...
If u want to be successful, u must respect one rule: Never lie to yourself.
  • #2,568
  • Nov 4, 2014 6:08pm Nov 4, 2014 6:08pm
Quoting aed71
{quote} Good examples. You cannot explain these rules even to a child. He/she would not accept it. I believe that this is 100% invented to "stop hedging strategies" which might be a big headache for some big players. I have no other explanation. I really would like to see win/loss ratio of US traders before and after FIFO rules (3 months before and 3 months after)
I believe it was made to close out the FOREX retail trade on the small level. You can hedge and multi-level trade with the big banks. They are not covered by FIFO, for example Citi-Bank. But you need a minimum of 10K or more with these guys. Now that I can trade successfully I am willing to risk such amounts of money but I doubt I would have ever entered the industry starting out with that much money. I paid my tuition trading 500-1000 dollar accounts until I grew them to 10K+ and now I trade with a big account. It just seems these guys only protect the big boys and keep the average Joe/Jane out of THEIR market.
  • #2,569
  • Nov 4, 2014 6:10pm Nov 4, 2014 6:10pm
Quoting aed71
{quote} Yes using two account somehow solves the issue, I've read several posts about it while searching about hedging strategies. However it makes things more complicated as you mentioned. And thanks for the interesting ea chart...
The problem with trading two accounts is being able to transfer back and forth when needed. It only takes one time for a transfer delay and you could be in trouble. I find trading multiple accounts and multiple screens, I miss things or get in too late. It is just easier to trade one screen and one account. I did multiple accounts for a bit and my profit percentage went down.
  • #2,570
  • Nov 4, 2014 6:44pm Nov 4, 2014 6:44pm
This is a no-brainer question. When you are leveraging or gearing in forex trade, you are already hedging your trade and if your trade is wrong or fail, the obvious and logical way is to stop the loss, and hence stop loss. Why would anybody in the world would want to carry on losing despite a failed trade? Why are we deliberating over issue which is so basic and simple really riled my comprehension.

GS
  • #2,571
  • Nov 4, 2014 8:00pm Nov 4, 2014 8:00pm
Quoting genghistar
This is a no-brainer question. When you are leveraging or gearing in forex trade, you are already hedging your trade and if your trade is wrong or fail, the obvious and logical way is to stop the loss, and hence stop loss. Why would anybody in the world would want to carry on losing despite a failed trade? Why are we deliberating over issue which is so basic and simple really riled my comprehension. GS
Because its not a failed trade. Forex is the only investment industry I know that has a large following who believe there is something wrong with multiple positions. It is done in other investments and businesses all the time but you run into this one dimensional thinking bias in Forex. When I worked for Disney World I was on a stock purchase plan where I automatically bought stock every week with a certain percentage of my paycheck. There was no such stupid idea of having a stop loss or one purchase in and one purchase out. Averaging in is a normal way of investing. You simply kept buying and eventually you had a winning portfolio. This is done in investments all over the world, stocks, bonds, real estate, insurance, on and on it goes.

Then you enter the Forex world and you get this midget mentality of SL SL SL. WHY????? Why should I take a loss on something that will eventually lead to a profit. I dont look at trading one in, one out. That is one dimensional thinking. Egads why do you people buy into this stuff? Anyone who understands long term basic fundamentals would not need to use a SL on a JPY sell for the last two years. Its going down and will continue to go down. I have made a nice chunk of change by just selling JPY and hanging on to those trades. Only in Forex do you run into this SL one in one out mentality. Any other investment field you do your homework and then buy into the plan. There is no such thing as Donald Trump buying one piece of property and then selling it before buys another. To me (one in, one out) that is an idiotic way to conduct business. I know of no other industry where people promote that type of investing or business dealing. Very very strange.
  • #2,572
  • Nov 4, 2014 10:29pm Nov 4, 2014 10:29pm
Quoting Graviton
{quote} Love the burnt orange Longhorn by the way. Let's take a simple example to see if I can understand what you are saying. You enter a long position, it goes 50 pips against you, you enter a short hedge in the same pair. You have now stopped the loss at a -50 pip locked in loss, only you haven't cashed in that loss yet, it is still a floating paper loss. If you were to just close the trade at the same point with a stop loss or a manual exit, you would lose the same 50 pips. If price turns and goes back up with the hedge, you can close the short...
What you are proposing is not wrong per se. There is a thread on here that postulates that given a certain amount of time, current prices will tend to revisit prior prices more than 90% of the time. I use this to my advantage. I have seen with experience that my position will be taken out at some point for a profit. The way I trade is pretty simple.
If you are good at something, never do it for free--Joker
  • #2,573
  • Nov 5, 2014 12:01am Nov 5, 2014 12:01am
Quoting nanningbob
{quote} Because its not a failed trade. Forex is the only investment industry I know that has a large following who believe there is something wrong with multiple positions. It is done in other investments and businesses all the time but you run into this one dimensional thinking bias in Forex. When I worked for Disney World I was on a stock purchase plan where I automatically bought stock every week with a certain percentage of my paycheck. There was no such stupid idea of having a stop loss or one purchase in and one purchase out. Averaging in...
Excellent analogy. If you think of forex trading as akin to an equities investment (i.e., I see this stock going down long-term) and you invest in it in small pieces on that basis, it kind of changes the landscape for you as a trader. But I've found that if you're going to embrace that model (which I do), the only way around potentially punishing swings in the market is to go microscopic (comparatively speaking) with lot sizes, something that many traders have a hard time adjusting to because they want to go in big now, win big now, and simply lack the patience to wait for overarching trends to complete themselves ... .
Fireworks are fun ... as long as you don't blow your fingers off.
  • #2,574
  • Nov 5, 2014 1:27am Nov 5, 2014 1:27am
Quoting ZebraSquirl
{quote} Excellent analogy. If you think of forex trading as akin to an equities investment (i.e., I see this stock going down long-term) and you invest in it in small pieces on that basis, it kind of changes the landscape for you as a trader. But I've found that if you're going to embrace that model (which I do), the only way around potentially punishing swings in the market is to go microscopic (comparatively speaking) with lot sizes, something that many traders have a hard time adjusting to because they want to go in big now, win big now, and...
You dont have to go microscopic you just dont play your full position out of the box. Lets say you like to play 1.00 lot sizes. You dont have to enter the trade at a 1.00 lot but go in with quarters. You can add to a winning trade by .25 a position or a losing trade by .25 a 2nd, 3rd, or 4th position. After a while you can see if the trade is bad or good against you. If it truly is bad and you really did misread the market you are not taking the full hit when you close a losing trade versus and person who tries to go one in one out with the full 1.00 lot. Lets look at the JPY on Friday.

One in One out philosohpy sells the USD/JPY 1.00 lot size. He hits his SL and takes the full hit.
Multiple position trading opppppppppss thats not good and closes or may even try a 2nd position if the trader doesnt understand the news behind the move. Either way you realize bad trade, get out but you take a lot lower hit money wise on the trade and played a much bigger range on your SL.

Lets buy usd/jpy 1.00 lot played now what, do I stay in? do I exit? when where how long? So many trades I have seen my profit disappear? what do I do with this winning trade.

Multiple positions, hey this great, add add add close a profit close another profit add add dang look at that baby go close profit add........ hmmmm what should I do for the weekend, will it continue, will it not???? Ok close out the winning trades and keep one.

So many advantages, cut the losers with smaller lots having been played, ride the winners and pile on the trades.

aud/jpy 7 trades 191 pips on Friday. Total move from low to high 250 pips captured, 77% of the move
gbp/jpy 4 trades total 422 pips: Total move from low to high 518 pips, captured 82% of the move.
usd/jpy 5 trades total 342 pips: Total move from low to high 332 pips, captured 100+% of the move.

I did that and I was late to the party. I completely missed the JPY session moves or all my returns would have been over 100%. I didnt know the BOJ was going to make such a bold move. I also held on to a trade on each one and caught the gaps on the next weeks open. If they went against me with the partial positions I still keep a good part of my profit. You jump in when you catch the moves and you stay out when there are losers and/or you take just a partial loss. Some of you are going to get this and when you do you will become consistently profitable. Minimize your losers, stay with your analysis of the market even if your first couple of entrances were not that great, once you get the direction right pile into the trade. The multiple positions more than make up for any partial losses you make and much faster recovery. Multiple positions keep you from getting badly burned on a bad analysis of the market. Multiple positions in profit multiply quickly and you get to constantly pocket profitable trades every day.
  • #2,575
  • Nov 5, 2014 1:40am Nov 5, 2014 1:40am
Quoting nanningbob
{quote} You dont have to go microscopic you just dont play your full position out of the box. Lets say you like to play 1.00 lot sizes. You dont have to enter the trade at a 1.00 lot but go in with quarters. You can add to a winning trade by .25 a position or a losing trade by .25 a 2nd, 3rd, or 4th position. After a while you can see if the trade is bad or good against you. If it truly is bad and you really did misread the market you are not taking the full hit when you close a losing trade versus and person who tries to go one in one out with...
Your last sentence is the most important one. I showed a friend of mine how trading 3 cents per 1000 dollars can really add up in a strong move. I also showed how this can work in your favor is you really screw up the timing. It was suggested that I start a thread. Then I informed them that there was no need to reinvent the wheel. 5.0 did the job just fine. What I am trying to change in my little place on this speck is that FX is a way to get financial freedom, much faster than in many other venues, but playing the lottery ( betting it all on black or red) is not the way to do it.
If you are good at something, never do it for free--Joker
  • #2,576
  • Nov 5, 2014 5:18am Nov 5, 2014 5:18am
Quoting Chicky
{quote} Okay, you are already almost there. Let me explain a little bit more. Eur/usd is currently at 1.2500, the Closed End for it is 0.0000. It cannot go below 0.0000, but how we know how high can it go? That is why the high end is Open End. Since currency prices are determined with reference to some other currency, let's reverse the the pair to usd/euro. Now usd/eur pair will again have a Close End at 0.0000. That means: usd/eur = 1/1.2500 = 0.8000 or 8,000 pips Intrinsic (adjustment for value difference)= 8,000 pips x 1.2500= 10,000 pips or...
Still struggling Chicky lol - First off I question your statement that EU cannot go below 0 - I would posit that it can. At the moment you get 1.25 Dollars for 1 euro if that was to go to Euro1 = 25c that is below zero.

We also do not and cannot know how high it can go(that also applies on the low side) - there is no reason it could not got to $20= 1 Euro - however unlikely that might be. You state that the limit for the open end is 2.5 - I would suggest it is infinite, also unlikely, but possible.

Given your background in bookmaking I think what you do, although I can't work out the finer details yet, is have 2 open books that balance out and you move funds around from the long side to the short side and vice versa - taking small incremental profits along the way.
  • #2,577
  • Nov 5, 2014 5:26am Nov 5, 2014 5:26am
Quoting Chicky
{quote} See Four, the point is not to trade without a stop loss for the sake of not having one. One can get wiped out in minutes if there is no stop loss. The point is, if there is a safety net better than a stop loss? Yes, there is ..................and yes there are. Going further, if there is something which is even better than this Safety Net? Yes there is, but I don't know if there are. A holy grail method has no concept of a losing trade. Yes, there will be losses, but no trade ends on a loss. is the best option if we don't want trading...
This is confusing the hell out of me - Yes, there will be losses, but no trade ends on a loss. How can you have losses if no trade ends in a loss - unless you never close a losing trade of course???

better than this Safety Net? Yes there is, but I don't know if there are. If you don't know if there is how do you know there even is one?
  • #2,578
  • Nov 5, 2014 5:54am Nov 5, 2014 5:54am
Quoting ZebraSquirl
{quote} Like anything else, though, I think that hedging is somewhat of an art form and that there are those who have a knack as to the timing of when to exit positions on one side of the hedge or the other to their maximum advantage (e.g., http://www.forexfactory.com/alirajaie#45 (particularly the TE that ends in 95)).
Hi Z - the TE you link to is not hedging - he's just trading the range both ways.
  • #2,579
  • Nov 5, 2014 6:51am Nov 5, 2014 6:51am
Quoting stewrigh
{quote} Hi Z - the TE you link to is not hedging - he's just trading the range both ways.
Oh, I thought he used to hedge ... . On that monster $400K account he used to have ... . Lol.
Fireworks are fun ... as long as you don't blow your fingers off.
  • #2,580
  • Nov 5, 2014 7:00am Nov 5, 2014 7:00am
Quoting dare123
Good-day All, I choose to stop trading with stoploss. I now trade without stoploss. What do you think about trading without stoploss? and if you are currently trading this way or you have traded this way before, kindly share your expirience.
I trade without stop-loss, but I do the cut-loss manually if it turns out not the way I want to.
ah well, sorry for replying your very first post in this thread, I just found this thread. LOL

you can see my TE here.
Let the market comes to you!
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