successful trader without stop loss?

I have choosen to introduce a new way to exit instead of stop loss. Get the pips of last 5 winning trades, remove the smallest and the lowest, and average the remainings, then divide by 2. With this, I am in profit even with 40% winning trades. It worked well on backtest, trying to test this on forward.

@fredix This is certainly an interesting arsenal that need to be tested on risk management, will get back to you once I gain enough data on forward testing.

Great! btw I meant remove the smallest and the higest.

Stops are a scam and there is absolutely no reason to use them. If you are entering positions in the right place, ie near support or resistance, you should never need to use a stop because if the trade goes against you, price always comes back to S/R where you can close the trade for a smaller loss or break even rather than closing the trad at the greatest loss making level. I'v been trading professionally for over 10 years and managing money for 4 years. I never use them.

Huge rookie here, was just wondering if some of you might have some concrete success stories... heard so much bad about Forex that is hard to get jacked up to learn how to trade, any help is appreciated.

John

stories like drags to riches etc? nah i dont think people would be coming here to talk about how thier 200 usd turned to 2000000 in a year, but, like me for instance, i started back in 2011 with hotforex with a small account, a couple of blown 150 usd, which was really fruastrating, and gradually in 2012 decided to try again but this time, took my time to actually go through online courses ike the school of babypips, and was happy with cents as profit, making a couple here a couple there, losing trades became my best friend, i just didnt let it take over, and now im making a couple of hundreds a week, trading small, mostly on metals like gold.. but thats me. and its a part time thingy.

its extremely dangerous...

I think

IF you are

1. Sure that the trend will go to your direction sooner or later,
2. You have a nerve of steel to see 20 to 50% (or more) of your account lose (on paper)
3. You have a lot of money to absorb the unexpected move against your predicted trend

THEN
You can trade without stop loss.

Of course if you are watching your platform all day, you will not need a stop loss.

I cannot do any of those, so I needed my stop loss. Although sometimes it is annoying because the market will hit my stop loss before turning back to my predicted direction.

Its a good mindset to learn trading without stop loss.
When I newly started trading, I used stop losses and many times, price would eventually go on to hit my profit targets after it has taken my stop loss.
So I was loosing, even with correct strategies.
I then learnt how to hedge
Since then I have been trading without stop losses. I only prepare counter hedging trades, in case price goes against me. And so far not excellent but results have been good.
Sometimes, I purposely take the opposite trade of my analysis e.g If my analysis says "Sell", I buy.
Then I take the trade with maybe one third of the normal size I would have traded.
Prepare a pending counter trade with maybe double the one third in case price goes the other direction
So if the original trade goes well, close profits and cancel pending trades.
If the original goes opposite direction and takes the counter trade, close all trades together for cummulative profit simultaneously when you are in profit.

But this strategy works best around price areas of "no return" (e.g areas Supports and Resistance) so that you are guaranteed price will either bounce or break through. In the case of bounce, your original trade wins, in the case of breakthrough, your counter trade wins

That is extremely naive.

If the market gaps, a Stop loss will not help, as the trade will exit at the closest price to your stop loss order, which will be where the market opens, you will still lose as much as someone who had no stop loss (entries being equal). In actual fact the general rule that gaps will be filled sooner or later, would probably serve the no stop loss person.. (just checked, and the no SL could have traded out at breakeven, if margin was not an issue)

a drop of 3000 pips on anyones account (well at least on micro accounts) woudl have had a margin call at the very least, or most likely a negative equity...

Sl woudl not help you in the CHF incident.

I personally always use a stop loss. Ive just learned where to put it so that it is out the reach of the stop hunts that occur before the real move.

Reading through this thread again, I do think that there is confusion about Stop losses and what actually constitutes a stop loss.

There are 4 types of stop losses that i can think of... which i think woudl fit 95% of traders... winning or losing that is!

1) Hard stop loss - where you physically enter a point at which the trade will exit if it hits this point.

Pros- once there is a hard stop in place, it does not need to be moved, so it is a set and forget - and you can happily make a cup of tea without fear of you losing your shirt!

Cons - there is a lot of false advertising of this... a bit like contraception... 99.9% of the time it will work, and you will get out at, or very close to this price. Very rarely though, if there is a gap in the market, the SL will nto protect you (as in the CHF example i gave a couple of answers back). What would happen is that after a huge gap (or a small gap) past your Hard stop, the broker woudl exit your position immediately after the marekt opens, and get it as close to your price as possible. In the CHF example, if you were looking a risking 2%, whether you had a hard stop or imaginary stop loss, you woudl probably get into a margin call area, and most likely into a negative equity place...

The other major con is if you get this wrong... or even right, you are subject to stop hunting from the Market makers... how many times has your stop been taken out to the pip.... I know i have had this happen to me COUNTLESS times!


2) Imaginary stop loss - where you have an idea of where to exit

Pros- if you are well versed in the market, you would probably be able to steer clear of getting stopped out, only to see it go in the other direction and you make your TP target. This is the exact opposite to point 1!

cons - if you are wrong, it can keep going down! This would be pretty much based on price action, and using MTF to judge the momentum of the move, however, the idea here is that you are proficient in the markets.
You are tied to your compueter for this. Of course you can set up push alerts to let you know when it hits a ceratin area that you may wnat to get out of the market... but still, i woudl be fretting over this!!!


3) The inbetween - using a script/EA to manage your SL, hiding the actual stop loss to avoid the MM

pros - You are not tied to your computer and you feel protected from Stop hunters. Remember your brokers can see where you SL is placed... and so can the major players that make the market move...

Cons... again, if you are placing your invisible order at those big round numbers, and it falls to a couple of pips below, that could trigger your stop, only for it to be a bit of a fakeout.


4) Exit through strategy - this is closer to using the no stop loss idea, but the exit is still controlled, as the startegy itself dictates the exit - whether it be stoch cross, MA cross.... whatever

Pros - not dictated by hard and fast rules, and is largely dictated on where the price is going and by how fast it is moving.

cons - exits are unknown, but they are still monitored. A winning trade can turn into a losing trade, and it is difficult to judge what your risk actually is if you are using fixed ratio MM. There are other ways to control this though...
This is just a brief overview of a couple of thoughts i had based on the different options of exiting a position. But they all have stops built in.. All have defined points where either computer logic would kick in price>x, exit, or based on human logic... this is a fake out.... or system logic when x happens=exit. These are all stops, even if you do not enter a SL into the platform...
The last one is where you are properly gambling. I want to make X amoutn of pofit. Or this is goig up, and i am prepared to risk my account on it... ie, plug in a trade, turn off the panel, and just watch price until either your account is gone, or you hit your TP... or
you just let it run...

Even if the first 4 resuls in an 80% reduction in your account, if you are following a trading plan, you are following it - it may not b a great plan, but you are following it with an idea on risk... ie what is the worst that can happen?

With the real no stop loss, it is a case of ego over sense and logic - i dont think even the newbie of nebienessness would look at their account, see that they are 100 pips down, or $10 and not think to close the trade (based on a tiny account size that is!)

Personally, i use number 4. The only time i exit a trade is when the system tells me too. I might try to protect the trade by putting a hard stop in, but that is only to protect myself if an alert comes in when i am asleep - 9 times out of ten, I will havea pretty good idea of where that SL shoudl be placed as the system gives a rough indictaion... and in that event I shoudl be pretty well covered in any case. But that is not the same as using a stop loss - more a trailing stop!

Hopefully this helps... and there are probably far more situations than i have listed here, but these are the ones i can think of off the top of my head, and probably the most common...

Successful traders are traders who understand the risks well, so they will always use stop loss when trading. With a stop loss will allow us to minimize the risk properly. we do not know where the market will move so we need to stop loss for trading

Are you still trading with HotForex? I am planning to open a live account there.

Honestly speaking , I don’t use SL anymore, I prefer to do hedging than to open SL. For me everything that falls do bounce and everything that goes up falls down. So what I need is that I just need to be a little patient as I’m sure in the long run I can end up making good income without any problem at all. That is if I have good skill to speak with.

SL is actually a very important role to manage risk properly or target them, so for that as a trader wants to execute trades try to always strive to learn to run with more learning work forex properly, and more could be risks to be controlled with ease to make it more able to forex walk comfortably

Whether or not a hard SL makes sense comes down to ones trading style and effectively used leverage - discussing the use of Stoplosses alone is simply naive. If a so-called pro-trader doesn't use a hard SL he has chosen to do so because that exit strategy suits his entire strategy and not because he believes SLs are stupid or a scam (a typical clownfactory comment, by the way).

The same is true for hedging. Doesn't work, stupid or again, "a scam" is a typical thinking of newbies who are still looking for the one right way. A typical comment of seasoned traders is "as long as it makes you money" and there is a reason for this thinking: they have grown up at some point in their life and have stopped thinking about what their "idols" do. Copying an entire strategy can work, picking parts of it and putting it into something new without understanding the reasons behind individual decisions and how they work together is simply stupid (sorry if I offend someone).

I used to hedge a while (there is nothing fundamentally wrong with it), I use hard SLs now. The reason is quite simple: while hedging did work for me and actually suits my strategy, avoiding losses doesn't equal in more money. Waiting for a potential getting-out-of-your-hedge moment can mean ignoring multiple good other trades. Cutting a loser because you were too early comes down to "you can get in at a better price". For me, that's totally all right but then again, I'm trading all sorts of reversals on the 1m (high leverage precision trades) so that kinda makes sense in that context and a hedge wouldn't protect me from extreme spread widening (quite the opposite actually).

And now I'm off to the airport - Easter in Bavaria!

Hi there,
Of course it is very important to minimize the risk by putting sl limit. However sometimes it happens on volatile market the position to hit your SL and the all of a sudden the market to revers.
Usually most of the people are using 3:1 ratio.
Example:
Stop loss : -60
Take profit : +20
You have theoretically bigger chance to hit the TP first, rather then the SL
*use it on your own.

I haven't used a hard SL in a while because I used to get killed with news events and unpredictable spikes. I have actually done a lot better since I stopped using it.

success in forex is not that easily get, especially with not put a stop loss it is to be the true science maximum owned. So to that as a trader who wants to be able to run a better trade with us trying to run trading by learning the preparation and readiness