Getting in too early

win/loss ratio is 17:13 with about 4-5 of the 13 losses stemming from shakeouts. Winners on average are about 1.2% while losers run 0.9% on average. The % returns are already commissions- reduced.

Looking back at my record, I did notice that the % gain for winners has been coming down... I'm not letting winners run as well as I used to. I guess partially because I'm in a hurry to take the gains to make up for those shakeouts, which isnt right.

It's a good thing I reviewed this. And now that we're here, what's a good exercise to develop so as not to get out of good winners.

I used to have quite a bit of 3-4% gainers, but lately they're down to 1-2% tops, while others I let fall back into 0.2-0.5%.
 
Your ratios are pretty good. Where's the problem? Of course your not getting enough on your trades. Nobody does.:) As for your exits, that is a science in itself and there is lots of literature on the subject. I target the nearest s/r and try to get out a tick or two before it gets there. About half the time it continues on through the s/r and I frown, about half the time it reverses and I smile.
 
Originally posted by arzoo
That's good advice Jorge. I hold 2-3 positions on average, like you, I feel it sometimes gets a bit confusing once I hold 5 or more issues. I just try to keep things managable.

What time frame do you use?
More...

My time frame can vary anywhere from 5 min to almost all day depending on the type of stock. On my news plays if the volume is heavy enough I will often add to my position and try and survive the shakeouts as long as the trend continues. I have no hard rules, so it is hard to explain my time frames. I mostly just watch the momentum and if it stalls I will be prepared to exit, but I will give it a little room to avoid being taken out.

On some of my larger NASDAQ stock trades I will normally exit as soon as the volume slows down and will be prepared to reenter the trade if it was just a short term consolidation.

Again I would like to mention that their are some markets such as last week where playing breaks is very difficult. I would do best to avoid these type of days, but I usually end up trying to trade larger position sizes within the range. Like last week this usually ends up making me nothing and my broker rich.
 
You must log in or register to reply here.
Back
Top