Frequent small profits, rare large losses...

[W.J. Feathermaker III]

If you're worried about "black swan" events, which indicate expectation of major gyrations, use delta neutral puts against the stock instead of stop losses.

I think that makes some sense as well...Figuring out a way to use options to eliminate the tail risk.

 

[nxt7]

I don't understand how you can use the lowest leverage possible and still be exposed to frequent near 100% total losses.

Its probably because I set my profit targets so low that they are extremely likely to automatically close out. Its why I get a success rate of >90% and the 10% losses are huge when they happen. Like last week I nearly doubled my capital but just this week one loss put me back to where I started.

Hmmmm, this style makes no sense to me, Scalping and some day trading is risking greater than reward, but my testing show anything you keep overnight is long term ruin of accounts, unless you constantly hedge with options can help but sometimes that is not an answer either. I think it is back to drawing board.

I will think about using options to hedge, thanks. Though I am constrained by limited capital more than anything. Back to the drawing board it is...

 

[fan27]

How big was your loss in relation to your average win?

 

[wintergasp]

Hmmmm, this style makes no sense to me, Scalping and some day trading is risking greater than reward, but my testing show anything you keep overnight is long term ruin of accounts, unless you constantly hedge with options can help but sometimes that is not an answer either. I think it is back to drawing board.

@nxt7 That's the only comment worth reading.

 

[globalarbtrader]

Its probably because I set my profit targets so low that they are extremely likely to automatically close out. Its why I get a success rate of >90% and the 10% losses are huge when they happen. Like last week I nearly doubled my capital but just this week one loss put me back to where I started.



I will think about using options to hedge, thanks. Though I am constrained by limited capital more than anything. Back to the drawing board it is...

What proportion of your capital would you los on single trade if you hit your stop? What proportion of daily vol is the stop gap? What is the ratio of stop profit to stop loss?

Do not consider using options yet with your current system you will just steadily lose money buying vol.

GAT

 

[nxt7]

How big was your loss in relation to your average win?

What proportion of your capital would you los on single trade if you hit your stop? What proportion of daily vol is the stop gap? What is the ratio of stop profit to stop loss?

Do not consider using options yet with your current system you will just steadily lose money buying vol.

GAT

Losses were x20 larger than the profits when they happened. I set my stops far away to survive volatility.

 

[fan27]

Losses were x20 larger than the profits when they happened. I set my stops far away to survive volatility.

90% win rate where a win is $1 and a loss is $20. Assuming you start with $20 you are very likely to be broke in less than 20 trades.

 

[globalarbtrader]

Losses were x20 larger than the profits when they happened. I set my stops far away to survive volatility.

Whatproportion of your capital would you lose on single trade if you hit your stop?

 

[W.J. Feathermaker III]

Losses were x20 larger than the profits when they happened. I set my stops far away to survive volatility.

That does seem pretty extreme.

 

[galvinlee888]

Question to all the newbie :

90% winners but with x20 larger loss is a NO GO strategy.

However, even you do the opposite way of trade (10% winner but with x20 profit in the winner), you STILL LOSS in the real world, do you know why ?

The broker or bucket shop owners will not like the answer as all their most valuable customer - day traders (aka day dreamers) will run away if they know this answer.