Collection of the most stupid trading advice ever
- Thread starter sculptor66
- Start date
I've tried every method of arriving at a stop level, none of them worked well enough.
Sure, I could find stop levels that improved drawdown and return but when realistic (emphasis on this) slippage was included, it actually lowered performance.
Remember, stop levels are usually triggered when there is movement and during spikes you don't get a price that is anywhere near your stop trigger.
It boils down to what instruments you trade, if it's something hyper-liquid and your positions aren't huge, it might just work. Or if you trade longer term and a half percent slippage won't dramatically affect you. Anything less than that and it will be nasty.
I trade futures intraday.
I arrived at a reliable stop level, but most important is that I already get out before the stop is reached most of the time. Stops are, to me at least, for emergency situations. Don't have really problems with spikes. Fills can be 1 or 2 ticks worse, that's all.
My system gives from the start an expected behavior of the market, if the market does not follow my expectations I receive a signal to close the trade. I tested this over thousands of trades and I concluded that the best results come from following the system and the stops.
The losses from missed profitable trades are more than compensated by missed losses. I am not able to improve the overall result of these two in a consistent way. Which proofs the stops are the best thing to do.
But I agree it all depends of your system, so for some, stops should be used in another way.
How can this be stupid advice?.....BLASH or SHABL is the only way to profit.....you are not suggesting to buy low and sell lower.....are you?.....that would clearly be a loser......I can't believe what am reading here?.....it is so obvious.....?
How do you "know" it is a worse price?.....the question is invalid because if you know it is at a worse price, that means you will not be buying.....but what about the one you are already in.....did you sell out.....this is because you know the prices will not rise further.....however.....
.....if this was a making of an up-trend, say a higher low (HL) then rather than saying it is at a worse price, it is in fact a great opportunity to add.....now, there are questions here to be asked.....how do you know that prices will rise further?.....why did the price come down in the first place?.....how do you know that you know?.....
.....more importantly.....why do you "think" the way you "think"?.....why do you "limit" yourself in this kind of "thinking"?.....do you even "know".....or even "aware" of it?
Actually...that's a misquote from the late 80's that was intentionally misused in the 90's when day trading became popular on the rise of the discount brokers and online trading for retail traders.
Original saying - The key to success in trading is to look at context.
The word context involved market information that did not involved charts and the word is still misused today by retail traders and not by professional traders...mainly and intentionally misused by those that have a beef with price action trading or technical analysis.
Further, you're absolutely correct in that the money making machine of institutions is selling finance/investment products, IPO/mergers, banking/foreign exchange, commodities markets, pension plan management and so on.
In contrast, you're absolutely wrong that many of them do not use charts. Many do such as BNP Paribas, Credit Suisse, JpMorgan Chase, Bank of America and so on. In fact, a few of them have specific departments and individuals dedicated to chart analysis along with winning or being recognized for their technical analysis. Some use job titles for these individuals like Strategist Technical Analysis, Head Trader.
Further, you have public companies like Google and many other popular known corporations with their own private trading department to trade and manage billions of dollars and short-term investments in an effort to improve the returns on all that extra pile of money.
The traders at these companies tend to be bond traders, foreign exchange and many other trading products working with quants, project managers and others. Simply, they aren't stock traders. Yeah, the traders at these companies use charts too. The issue here is that its a well known fact within the industry that private large companies had their own private trading room prior to 2000. Yet, many public companies form their own private trading rooms since 2000.
Regardless, as others and I have told you before...chart analysis is not as important as their other tools. Yet, the fact remains, they use it as a component of their decision making process and are compensated with bonuses for top performances and in some cases get recognized for their technical analysis.
*** The most important thing you need to remember is this, as stated several times before to you, chart analysis being used by institutions is not used the same way as used by retail traders. A retail trader that uses chart analysis will use it exclusively for their trade decisions. In contrast, institutions that use chart analysis...the trade decision was already made by other departments. They just use the chart analysis for the when to do the trade. This is a process that the typical retail trader doesn't do...its a process that a minority of retail traders will do but they usually are the ones with a former or prior institutional trading background.
Simply, you're absolutely incorrect if you believe institutions do not look at charts. They do use charts in their decision making process...just not the same way as the typical ET forum member uses them. The primary reason why the typical retail trader doesn't use charts the same way as institutions...we just don't have access to other resources and tools that institution traders have access too.***
P.S. There are some institutions that do not even have a trading floor/room. Thus, these particular firms do not have traders looking at charts nor using bloomberg/CQG/Thomson terminals.
P.S.S. Some of the U.S. top universities with very large endowments have their own investment management company and trading team to make extra money on all the piles of cash flow. Their returns are typically higher than public/private companies that have their own investment/trading team. They often attract some of the world's top money managers and traders from institutional firms.
Last edited:
it's a nice idea, but in practice you don't know whether you are buying low or selling high until u close your position.
Indeed, even the smallest child and the biggest idiot knows that you should buy low and sell high. So that's stupid advice.
The real advice should be: telling how you should do this.
But that they never tell.
What is cheap now can end up being very expensive and vice versa.
They never tell because NO ONE know. No one can predict future (up or down) better than 50% accuracy.
1. All you need is a plan and stick to the plan!! It's not the "plan", it's YOU that keeps you from trading like the unverified gurus who make the claims and gave you the "plan".
2. Price action folks saying they use statistical analysis and the scientific method
3. Failure is good since you are "learning"
4. Just keep staring at charts, you will eventually "get it"
5. The primary TA premise that the past can be used to find an edge in the markets
6. Discipline is the most important thing
2. Price action folks saying they use statistical analysis and the scientific method
3. Failure is good since you are "learning"
4. Just keep staring at charts, you will eventually "get it"
5. The primary TA premise that the past can be used to find an edge in the markets
6. Discipline is the most important thing