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Isn't one man's "accumulation" another man's martingale?
- Thread starter PlusMinus
- Start date
Precisely. It all depends what kind of skills and strategy one has. If you go in with 1 contract knowing that if the market pulls 5 points you will enter 1 more then that is accumulation.
If on the other hand that second entrance was caused because you were hoping for 5 point gain and got the opposite and hence threw in another contract to bring the breakeven closer that is the big MMMMM.
You do that enough times on a 5K account and one day it is going to be a financial tsunami.
If on the other hand that second entrance was caused because you were hoping for 5 point gain and got the opposite and hence threw in another contract to bring the breakeven closer that is the big MMMMM.
You do that enough times on a 5K account and one day it is going to be a financial tsunami.
Good point. I like your reasoning.
No. Martingale is doubling up simply because the price is down, without regard to the trade expectation. Accumulating is increasing your size because you think the trade expectation has got better.
It also has to be in context of your methodology/system. For example, I use two particular algorithms, one that gives me precalculated price points and the other that gives pretty reliable exhaustion points. The combination of the two are pretty reliable, but obviously this is not a science. Statistically, I know how many points the market can slosh around my entry level, so I know where I can add up and how much if I so choose. Call it what you want, avg'ng or MartinG. I only recommend adding up if you are quite confident in your method(s), and only you can determine that. Give me 100 successful traders and I'll virtually guarantee that every one of them does something quite different from the other, but they know their game.
Quote from Ghost of Cutten:
No. Martingale is doubling up simply because the price is down, without regard to the trade expectation. Accumulating is increasing your size because you think the trade expectation has got better.
Martingalers "think the trade expectation has got better" because they're usually trading some form of RTM and after the price has gone in one direction for x ticks it is more likely to go back the other way, according to them.