Addicted to Average Down?

Pension_Admin · Jan 22, 2010

Here is an article how how average down messed up everyone's life.

http://www.thestar.com/News/Ontario/article/609885

So, the question I have is: Is average down addicting?

GG1972 · Jan 22, 2010

What's new ? Another Canadian fraudster. Laws in Canada beg even a decent person to be criminal-he couldve done so much better with trading weed futures lol

ChkitOut · Jan 22, 2010

hope you didnt avg down today

Pension_Admin · Jan 22, 2010

Quote from GG1972:

What's new ? Another Canadian fraudster. Laws in Canada beg even a decent person to be criminal-he couldve done so much better with trading weed futures lol

I hate to say it, but I have to agree. There are so many hit-and-runs nowadays and with our current legal system, it's much better (financially) to have the victim dead than alive. This shout out the message, "It's better to commit crime." Thieves pretty much rules, because store owner can't catch and arrest them. One store owner has gotten charged for catching and beating a thief who has been stealing from him many times. The court let the thief go, saying there was no proof of theft.

Anyway, regarding Average Down, I think it is extremely addictive--like cocaine.

Pension_Admin · Jan 22, 2010

Quote from ChkitOut:

hope you didnt avg down today

No, I never did. I did some calculation on a spread sheet using my strategy and it showed that the result would be the same rather I average down or not.

So, I do the opposite.

PA

venkat · Jan 22, 2010

People average down(myself included) when they can't/don't cut losers quick basically both are bad for a trader...I am trying to get rid of both of them.

Scataphagos · Jan 22, 2010

Quote from venkat:

People average down(myself included) when they can't/don't cut losers quick basically both are bad for a trader...

Definition of "Investment".... a busted trade.

Kassz007 · Jan 22, 2010

Quote from Pension_Admin:

No, I never did. I did some calculation on a spread sheet using my strategy and it showed that the result would be the same rather I average down or not.

So, I do the opposite.

PA

Are you able to post your future telling spreadsheet?

Pension_Admin · Jan 22, 2010

Quote from Kassz007:

Are you able to post your future telling spreadsheet?

It's just a simple spreadsheet, assuming random outcome (coin flip) with a fixed r:r.

It doesn't tell the future, but it does help with my mental preparation.

PA

Stosh · Jan 22, 2010

I have found that averaging down is an excellent strategy when prices bottom and trend up soon after your purchases. I may write a book about this strategy. Stosh