ES Journal Archive (2006 - 2008)

opt789 · May 27, 2008

Quote from MandelbrotSet:

That's a great way of trading if one has those types of resources

This is part of B1S2 trading that some here may not know, and leads to some of the confusion. If he can trade over 20 contracts and uses little to no leverage, then you start to realize that once you have a lot of money you trade differently then when you are trying to "make it".

MandelbrotSet · May 27, 2008

Quote from Buy1Sell2:

If someone is trading the ES and cannot take a 30 pt loss, then that individual should not be trading the ES and should rather be trading the cash index.

Actually I would re-write that to say:
"If someone is trading the ES and can't figure-out how to take a loss and reverse their trade before it becomes a 30 pt loss they should not be trading the ES, they should rather be trading the cash index ... as those are the actions of someone who is an investor."

Quote from Buy1Sell2:

Currently, a 30 point loss is roughly 2.17% of the face value of an ES contract. What would happen if there were another 911 and let's say the Globex goes down and doesn't reopen for 3 or 4 days? This might be a tragedy for everyone including the traders who thought that their stop would protect them. Trades should always be considered beforehand to be long term trades as a worst case scenario.

Yes, risk management is an important part of trading, and a trader should always be aware of the worse case scenarios where they cannot liquidate a position which is moving against them due to no fault of their own ... but those are the worse case scenarios, not a situation where you watch the market drop (or rise) for anywhere from hundreds to thousands of dollars per contract and take no action to rectify the problem. :eek:

Buy1Sell2 · May 27, 2008

Quote from MandelbrotSet:

Actually I would re-write that to say:
"If someone is trading the ES and can't figure-out how to take a loss and reverse their trade before it becomes a 30 pt loss they should not be trading the ES, they should rather be trading the cash index ... as those are the actions of someone who is an investor."

Yes, risk management is an important part of trading, and a trader should always be aware of the worse case scenarios where they cannot liquidate a position which is moving against them due to no fault of their own ... but those are the worse case scenarios, not a situation where you watch the market drop (or rise) for anywhere from hundreds to thousands of dollars per contract and take no action to rectify the problem. :eek:

I like to spell it worst case scenario.

MandelbrotSet · May 27, 2008

Quote from Buy1Sell2:

I like to spell it worst case scenario.

Regardless, you and everyone else reading this Journal knows what I mean (uh, excuse me, "knows what I meant").

Buy1Sell2 · May 27, 2008

Quote from MandelbrotSet:

Regardless, you and everyone else reading this Journal knows what I mean (uh, excuse me, "knows what I meant".

Well, there is a palpable difference between the two. Worse case could just be a minor bad. I like to look at the major bad.

fearless9 · May 27, 2008

Quote from Buy1Sell2:

If someone is trading the ES and cannot take a 30 pt loss, then that individual should not be trading the ES and should rather be trading the cash index. Currently, a 30 point loss is roughly 2.17% of the face value of an ES contract. What would happen if there were another 911 and let's say the Globex goes down and doesn't reopen for 3 or 4 days? This might be a tragedy for everyone including the traders who thought that their stop would protect them. Trades should always be considered beforehand to be long term trades as a worst case scenario.

No argument there Sir, I have been pointing out the hidden danger to the long side for years.

But you took a 120 tick (more or less) hiding on an open Globex; or am I missing something in the interpretation.

This classic however takes the cake ...

05-23-08 03:43 PM

Quote from Buy1Sell2:

Most new/inexperienced traders make the mistake of putting larger size on for a daytrade. This is exactly backwards of what should be done.

Well there you go.
After twelve years of hard work and trial and error, not to mention trial by fire, I am right back where I started.

regards
f9

Lawrence Chan · May 27, 2008

Quote from wave:

05-23-08 11:03 AM

86-89 short area

Any long positions taken under 1377 should hold to 86-89.

What about now? Has the condition changed?

aboldoldtrader · May 27, 2008

Quote from OldTrader:

I sold the other half of my ES at 1383.25, for just under 9 points profit.

I'm going to watch for a while.

OldTrader

nice trade

if you would have reversed short I might have relinquished my handle

kinggyppo · May 27, 2008

long spy 137.98 tight stop.

osorico · May 27, 2008

Quote from Buy1Sell2:

If someone is trading the ES and cannot take a 30 pt loss, then that individual should not be trading the ES and should rather be trading the cash index. Currently, a 30 point loss is roughly 2.17% of the face value of an ES contract. What would happen if there were another 911 and let's say the Globex goes down and doesn't reopen for 3 or 4 days? This might be a tragedy for everyone including the traders who thought that their stop would protect them. Trades should always be considered beforehand to be long term trades as a worst case scenario.

As usual, B1S2 is pontificating HIS trading philosophy, and those who do not espouse such are in the wrong.

While I agree that an ES trader should be able to absorb a 30pt (120 tick, $1500) loss per contract traded, the face value of the contract is irrelevant to the matter. The useful measurement would be 2% of the underlying index PRICE.

As for black swans, if the market is closed for 3-4 days, 30pts ES in either direction is a best case scenario and the least of worries for ANY open position. Trading ANY instrument with this type of event in mind is not productive IMO.