You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
I would like to discuss averaging down
- Thread starter Daring
- Start date
Hey riffraffpatrol,Quote from riffrafffpatrol:
The only "value" is averaging down is it allows for sloppy entries... poorly planned trades... if you want to call that value.
I would be very interested in the seeing the Profit and Loss curves of your T3 trading mentors. You mentioned in another thread that their trading results are 100% transparent. Could you please provide a link which illuminates their actual real-time trading results?
http://www.elitetrader.com/vb/showthread.php?s=&threadid=220746&perpage=6&pagenumber=144
I will reserve my judgment of their trading prowess until I see the results. I have no doubt that they are excellent marketers.
In regards to Averaging Down ... in general it is a bad idea but for some trading strategies it can be part of the edge.
For new traders, it is typically just a way to postpone the pain of taking a loss. Of course, the pain often then turns into a life threatening injury!
It all boils down to whether it increases the net profit of the system without subjecting one's account to undue risk.
Quote from trade4succes:
Don't the pair traders on this board average down, but call it euphemistically call it something else? was it "levelling" or something?
This thread is not about pair trading, I know. So this is my last post to illustrate my description of "adding on" to what otherwise would be labeled as a losing trade. (Erroneously looked upon as "averaging down.")
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=3630794>
Attachments
I hear ya, I have my own version of spreading over in forex and doubt my averaging down (and up) strategy would work if I was outright directionalQuote from deucy28:
This thread is not about pair trading, I know. So this is my last post to illustrate my description of "adding on" to what otherwise would be labeled as a losing trade. (Erroneously looked upon as "averaging down.")
<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=3630794>
Quote from riffrafffpatrol:
So since you declined my last request for five of your last trades where you averaged down... how about just one? Entries and exits. Just one example. If you state that there is a certain trading condition where it provides an edge... certainly you should be ready, willing and able to provide an example to support your thesis?
Fine I'll bite. Here's one trade from this morning. I thought it could be done around 31, but maybe go to 32. How would you have handled the trade?
Attachments
Quote from oldtime:
it isn't an edge if it has risk of ruin. Maybe it's just semantics, but when someone claims they have an edge it just sounds to me like they are trying to be a big shot, like they own a casino, when in fact they are just lucky (or very skilled) betters.
Risk of ruin is calculated by what you are putting at risk... account size.. and a presumption of win/loss probability. Any edge definitely has a risk of ruin.
Quote from SatMir:
Heh..u-huh...
SatMir-- not sure I understand the response...?
R U denying this is true?
Because it most certainly is 100% true-- a reversion to the mean will ALWAYS occur. Not subject to debate.
The issue is where will the mean be relative to entry-- therein lies the risk of relying on this type of indicator for a primary trade decision.
Quote from Slave2Market:
Hey riffraffpatrol,
I would be very interested in the seeing the Profit and Loss curves of your T3 trading mentors. You mentioned in another thread that their trading results are 100% transparent. Could you please provide a link which illuminates their actual real-time trading results?
http://www.elitetrader.com/vb/showthread.php?s=&threadid=220746&perpage=6&pagenumber=144
I will reserve my judgment of their trading prowess until I see the results. I have no doubt that they are excellent marketers.
In regards to Averaging Down ... in general it is a bad idea but for some trading strategies it can be part of the edge.
For new traders, it is typically just a way to postpone the pain of taking a loss. Of course, the pain often then turns into a life threatening injury!
It all boils down to whether it increases the net profit of the system without subjecting one's account to undue risk.
I have no idea what their actual track record is.
I do know that you can find out for yourself-- as they call out trades on their twitter feed for free... and post real time entries and exits in their Virtual trade floor.. of which you can listen in on their radio as they explain the thesis behind entries/exits. Just watch Redler on his videos and the calls he makes on bloomberg/cnbc/his daily recap/morning call/pricepoint sheet/off the chart newsletters...
These guys are pure TA that trade supply and demand- key pivot areas... breakouts/counters/join the trend on pullbacks... you name it.
The transparency is there.