Increasing Size During Drawdown
- Thread starter oldtime
- Start date
I think your old post answered your own question a very long time ago. Since you agreed with Keynes, a simple extension of that logic dictates that it would make no sense to increase size during drawdowns.
I would personally recommend that after two successive losing days in a row, that you cut your sizing down in half until you can put together two winning days in a row. Then go back to your original sizing.
Maybe another thought would be to go through your daily statements, build a spreadsheet or whip out a legal tablet, and do the math for yourself. It's your own trading system after all and I'm sure that you trade differently than alot of other ET Members you are querying.
How would your P&L look if you doubled your sizing after, say, two losing days in a row ? How fast would it have taken you to get back to even - or to burn through 50% of your account capital during the journey without seeing "even" again ? What was your max drawdown suffered during those periods ?
How would your P&L look if you doubled your sizing after, say, two losing days in a row ? How fast would it have taken you to get back to even - or to burn through 50% of your account capital during the journey without seeing "even" again ? What was your max drawdown suffered during those periods ?
If you respect him so little, why would he offer you anything?
Try to convince Old time that my simple little system is mathematically more sound than his complex spreading mechanism.
The last person I remember talking about sockpuppets was GrandSuperCycle. Is that you GrandSuperPooper?
at the time I asked, I had just started trading again so had no track record. The system in my opinion should have been 50/50 minus spread and commissions. I just tried to profit when it exceeded expectation. Then it went through a long losing streak, like 30 straight days. And that is when I began to contemplate the gamblers fallacy.
I never did increase size, and sure enough, I got back to even and got flat. And have never traded that system again. Even though, to this day I think it is my most profitable strategy, but the drawdowns can be severe.
but, in 20/20 hindsight, if somehow miraculously I had known where the bottom of the drawdown was going to be, I could have made it all back quicker by increasing size.