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What are you talking about? Sentiment is what affects price action . If the "simple math" actually affected price action then the market would be in a perpetual downtrend when in reality it's in a perpetual uptrend.

All I'm saying is if after a 50% draw down, your only reasoning to sell your position is because you believe that the math is against the stock recovering then you would be wrong in your assessment. The math actually supports that the stock will recover and most likely continue to higher highs...

Yes but my point is that even though a stock drops from 100 to 95 (5%) and it takes 5.62% to return to 100 does not mean that the stock is at some mathematical disadvantaged to return to 100. The stock will go down $5 and $5 with the same sentiment.

Yes, but you are talking about sentiment, and basing a trading decision on that, not on the fallacy that it will somehow be harder for the stock to return to its previous level. If sentiment changes the stock will return to that level. The traders fallacy is claiming that with sentiment being...

Let me try an analogy to help you guys out. If you were 400lbs and lost 200lbs...that's a 50% drop. If we apply the math from the traders fallacy, it should be twice as hard to gain all that weight back than it was to lose it, and all diet stories would be a resounding success! :) "According to...

Wow the level of ignorance around here is both astounding and reassuring that there are still plenty of traders willing to part with their shares at a reduced price based on a mathematical fallacy.

That's my whole point. The "headwind" can only be the actual sentiment of the market...so any investment decision should be based on that...NOT on the percentage handicap you are falsely placing on it. I mean if there are enough people out there who believe in the fallacy then it could have a...

Explain to me how a trading range happens then? According to you a trading range is a statistical impossibility yet they a benchmark of TA. If this fallacy were true then mathematically you should never buy a stock once it has dropped because statistically it will be harder for it to return to...

It's true you can be too smart to make money in stocks...ie accountants who get fixated on return of capital etc...but this isn't being too smart...its a complete and total fallacy.

You guys seriously can't be this dense? Price moves in increments of money, not in increments of "how much percent does this need to increase to overcome a previous drop in percent from some arbitrary price point". If this trading fallacy were true, it would be statistically impossible to...

Yes but the "math" doesn't apply. If it did you would NEVER get a trading range, and trading ranges are the most common trading phenonium along with triangles. I think where people are getting confused is they are applying the logic as if the stock itself has to over come the math...it doesn't...

No it doesn't. It's the same thing...portfolio goes down...portfolio goes up. The market probably wants you to think this so you all let go of your stocks dirt cheap. I mean think about it...if this was how it worked then why are hedge funds (and some retail) always looking to load up at the...

https://www.investopedia.com/investing/selling-a-losing-stock/ "A stock that declines 50% must increase 100% to return to its original amount. Think about it in dollar terms: a stock that drops 50% from $10 to $5 ($5 / $10 = 50%) must rise by $5, or 100% ($5 ÷ $5 = 100%), just to return to the...

I don't blame you...with me you're either getting a Lamborghini or you're going bust. I wouldn't have it any other way. :)

I usually see a risk reward of about 3:1 writing $5 wide on spx.

I'm not sure why all the pushback. This feels the same as when I was arguing for VR on a flight simulator forum. Ok, imagine a world where only peer to peer binaries existed. You would get a 100% payout if your "bet" ended up ITM. You could also close the "bet" anytime such as stops or take...

$1.60 per contract is garbage. There is no way to justify that gouging. It should be a flat rate per trade like stocks or .05 cents per contract.

Yes just like with regular options. The only difference is no fees, no commissions, no spreads, and no time decay. ALSO I get 100% of my payout being just .01 cents ITM at expiry. Yes you can put stop loss and profit taking orders. Yes happily. It's better than getting robbed on every single...

I don't know l...never traded futures but I would choose them over options probably. I don't like paying fees that's the main part... especially commissions to the broker. Having no time decay is also a plus...time decay is the biggest hurdle in options.

When do options traders ever make 100% of their risk? It's more like 50% at best on average. A 92% return on risk is phenomenal when you only have to be itm .01 Anyway I don't do futures but can't fathom they are any better than vanilla options with no skin in the game...no overnight...