Daytraders: Do you use Profit and Loss Limits for the Day?

[aeliodon]

Quote from ProfitTakgFool:

I don't ever think you should use a Max Profit but using a Max Loss is a good idea. When you are trading well you should trade as large as comfortably possible and go for the kill. Markets change and your system won't work as well in the next market. Don't limit profits unless you consistently give them back and if you do then you have a time of day problem, not a max profit problem.

This is the conventional wisdom - every one says limit losses but not profits.

But if you're not limiting profits then you're not limiting greed.

Sure there are days when you can make over 3x your average profit. But the same greed that motivates going for huge gains also results in a huge drawdowns from the HW mark as a trader fails to take profits.

 

[daxscalper]

Im a scalper and and have a daily profit target and a max daily loss limit.The limit is 33% of the profit target.

Sometimes I hit my target after a couple of hours, sometimes it takes all day and sometimes Im profitable without actually hitting the target. These are good days.

On a bad day I find my limit tends to get hit pretty quickly and I walk away.

There was a time felt you had to trade all day and take whatever the market gave...winning days were huge but so were losing days.

Working with targets has made me a better trader and introduced dicipline.

 

[Compulsive]

Quote from vikana:

Wrong answer, imo. Do the casinos in Las Vegas close down for the day after paying out a jackpot ?

Of course not - the trick is to have a small edge and play it as much as you can.

wrong answer VIKANA, the "trick" is to have a BIG edge and "play" it as LESS as you can

Casinos will"kick" out a person that is making too much from them