What are you folks doing awake at this time? Shouldn't you be near passed out by now?
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How much money would you need to Martingale your way to profits?
- Thread starter 1a2b3cppp
- Start date
While I believe your intentions with that post are good, it sounds very similiar to what the "gurus" say.
How many times has [insert famous trading "guru" whose system has been proven to be unprofitable again and again, whether we're talking about someone on ET (you know who they are) or on their own websites (you know who they are, too)] said something like "oh, don't give up, it just takes a little more work (and more subscriptions to my shitty trading room/indicators/whatever)"? lol.
Listen, I spent the better part of 3 years trying to "read the market." I was unemployed at the time, living off of savings, doing this full time, alienating friends and family with my OCD-like focus on trading. Hell, read my journal thread in the journal forum. I was making a lot of money day trading futures (averaging down with hard stops to prevent blowing my account) but I quit because my fiance and I broke up and I went into a depression and wasn't able to focus on anything anymore.
I cannot predict price direction. The reason does not matter, maybe my brain is just deficient in some aspect and that's why, unlike all the other ET millionaires, I cannot make MACD or other such quackery work profitably. But I don't think it's an issue of spending another few years trying to learn to do it.
I realized a while back that I will not ever be able to predict market direction, so I turned to looking for other methods that will make me money (eventually) regardless of direction. Indicators, PA, S/R, chart patterns, and all that other stuff, it's no better for me than flipping a coin to pick a direction to enter.
Maybe I should just park my money in bonds until the SPY starts going down and then transfer it so I can load up with a huge position at a low price.
What "huge" position? Your best case scenario for "huge" is a whopping 400 shares of spy which is not even one single s&p contract. What is your definition of "huge"?
Yes but using your numbers you hope to build up to 400 shares of SPY? Those were your numbers, not mine. And that is assuming we trade down to 700 which I don't think there is a chance in hell of that happening. I think you are saying one thing and your math is saying something entirely different.
Interesting 'discussion' if we wish to call it that and I thank the OP for getting the ball rolling. I think there is one item missing that may or may not be pertinent to the discussion.
Trading around the position, not just averaging down.
I basically do this in my wife's IRA and it generally works except as new highs are being hit since the system was first started.
The process: Add to the position at a given % drop then sell the equal amount at a same % gain. It's easier to just put in table form.
Start--
Buy 10 shares at $10 and use a 2% threshold (tight at 2%, I know)
Enter OCO as a sell at $10.20 and a buy at $9.80
(here's the rub, if $10.20 is hit, you sell and have no position at new highs. you just track the security and keep noting new 2% gains and keep moving the next buy level up by 2%, like an inverse trailing stop only it's a trailing entry)
Say $9.80 is hit so you now have bought 10 more shares (if using constant shares, you can also use constant $/level) and enter a new OCO for a sell at $10.00 and a buy at $9.61
And so it goes. If/when $10 is hit, you will have sold the $9.80 for a profit and are breakeven on the $10 entry...
Being ultra-conserative, I returned 4% last year from mid-May through the end of the year (and suffered as market kept hitting new post-May highs). I know, the pros will scoff, but for a quick test and an unfavorable market, I'll take it. Plus, given it's an IRA, I have many, many years to play this out and keep adding to the account monthly giving me either 1) more levels if a monster market collapse occurs or 2) increase my size per level.
It's not perfect, but it beats buy and hope, basically requires no energy, and complements other forms of investing and/or trading. I consider it just another tool in my toolbox.
Sorry if too off-topic.
Masterjaz
Trading around the position, not just averaging down.
I basically do this in my wife's IRA and it generally works except as new highs are being hit since the system was first started.
The process: Add to the position at a given % drop then sell the equal amount at a same % gain. It's easier to just put in table form.
Start--
Buy 10 shares at $10 and use a 2% threshold (tight at 2%, I know)
Enter OCO as a sell at $10.20 and a buy at $9.80
(here's the rub, if $10.20 is hit, you sell and have no position at new highs. you just track the security and keep noting new 2% gains and keep moving the next buy level up by 2%, like an inverse trailing stop only it's a trailing entry)
Say $9.80 is hit so you now have bought 10 more shares (if using constant shares, you can also use constant $/level) and enter a new OCO for a sell at $10.00 and a buy at $9.61
And so it goes. If/when $10 is hit, you will have sold the $9.80 for a profit and are breakeven on the $10 entry...
Being ultra-conserative, I returned 4% last year from mid-May through the end of the year (and suffered as market kept hitting new post-May highs). I know, the pros will scoff, but for a quick test and an unfavorable market, I'll take it. Plus, given it's an IRA, I have many, many years to play this out and keep adding to the account monthly giving me either 1) more levels if a monster market collapse occurs or 2) increase my size per level.
It's not perfect, but it beats buy and hope, basically requires no energy, and complements other forms of investing and/or trading. I consider it just another tool in my toolbox.
Sorry if too off-topic.
Masterjaz
...market doesn't give a rats ass about your stumbling blocks....it actually bets that you will be in denial and keep throwing money down the well...sound like vegas..it is...they play on your weaknesses...people are weak and stupid in general...so you have 2 choices..keep your weakness..let em win..let em keep your money ..and walk away..or get over yourself and stand up to the plate...forget your pettiness..accept that your weak and stupid..human..and while trading..forget that your human ...if you can eliminate your emotions..all the clouds go away..not permanently but there are days and days of blue cloudless sky..link these glimpses together and you will see market direction...their edge is human weakness...eliminate this ,even temporarily and you will see their scheme..they are human too..just riding above the emotions,trials .tribulations ,of every day life..i have no website..not asking for a dime..but have been thru all the crap and more..pretty much everyone who figured it out has been knocked down a few dozen times...averaging works,but it pays off after days ,weeks,months of being in the hole..it's no easier than any other system...and it won't work without an edge..in this case ..the edge needed is knowing market direction or some inkling of when the turn is coming
What are you talking about and why did your space bar get replaced with periods?
What point are you even trying to make? I'm sort of confused here.
I stopped day trading when I went through a mentally tough period. I was in no mood to be concentrating on anything.
I know you don't charge for anything and I wasn't saying you were. I just lol @ the people who do, and who have huge excuses when their "students" can't make money with their worthless methods. And their vague answers to specific questions.
My edge = being willing to sit through a year or two of drawdown in order to double my account. And having my entries such that I will never blow my account. And a pretty strong belief that price will, eventually, go back up.