John Carter from Trade the Markets
- Thread starter SuperVolatility
- Start date
<i>"i know that for me personally, i'd rather have a 60% trade with a potential gain of $1 than a 20% gain with a potential gain of $5.
and, yes, i know that's not 'correct'...my years back of statistics and game theory, etc. i just know how i feel most comfortable, which isn't necessarily correct. however, it keeps me mentally able to trade tomorrow, and the next day, etc."</i>
A 60% trade with potential to gain +$1 leaves us with maybe 20% that lose -$1 and the remaining 20% that lose a full -$2
+60% x $1 = +$6.00 gain
-20% x $1 = -$2.00 loss
-20% x $2 = -$4.00 loss
--------------------------------
Net result in the end?
and, yes, i know that's not 'correct'...my years back of statistics and game theory, etc. i just know how i feel most comfortable, which isn't necessarily correct. however, it keeps me mentally able to trade tomorrow, and the next day, etc."</i>
A 60% trade with potential to gain +$1 leaves us with maybe 20% that lose -$1 and the remaining 20% that lose a full -$2
+60% x $1 = +$6.00 gain
-20% x $1 = -$2.00 loss
-20% x $2 = -$4.00 loss
--------------------------------
Net result in the end?
<i>"And speaking of the "V," it is one of the strongest setups I know of and works beautifully in today's volatile market. It will also get you in a trend if you happen to miss it early."</i>
Those v's will take out more stops than trades entered. Nothing wrong with the move itself... if you know right where to anticipate the inevitable first (and second) pullback(s) it is gold. They happen like clockwork in highly predictable spots.
But before that can happen, most -2 / +1 traders are getting whacked out of their too-wide stop... right about where the next actual entry should be in the first place.
They'd be money ahead to have gone flat and objectively seek the next clear entry point instead of holding mile wide stops.
Those v's will take out more stops than trades entered. Nothing wrong with the move itself... if you know right where to anticipate the inevitable first (and second) pullback(s) it is gold. They happen like clockwork in highly predictable spots.
But before that can happen, most -2 / +1 traders are getting whacked out of their too-wide stop... right about where the next actual entry should be in the first place.
They'd be money ahead to have gone flat and objectively seek the next clear entry point instead of holding mile wide stops.
OptionCoach - What I meant to say is that there are great great, perfect traders but they are lousy, boring, uninteresting speakers..makerteers. While on the other hand there are those who are not good traders or infact bad traders and yet very engaging, entertaining, articulate speakers. So latter group tends to be in the couching position while the first (great traders) remain in player position.Quote from optioncoach:
Someone pointed out that Hubert Senters might be an above average trader but a lousy marketeer...which I agree...the guy is a poor speaker though honest and straight shooter, has funny accent, a bit blunt, while John Carter is a smooth operator.
I don't know if Barry Bonds, Michael Jordan and Mike Tyson would make great couches...tho all are respective sports finest yet. While Bill Bellashek or Robert Kraft (owner Patriots) are fine managers and couches but I doubt they can run past the 20 yard line without being ........
make sense?
austin - i was ignoring the loss part of the equation, just trying to use a simple example...60%*1 < 20%*5 and yet i'd feel more comfortable with the first.
supervol - you mean coaches....not couches. the history of baseball (and i'm guessing most sports) is littered with superstars who couldn't manage or coach anywhere near the level of their playing success.
hey - most prominent sports example today - isiah thomas. amazing player, incredibly inept manager of people / coach many times since his playing days.
supervol - you mean coaches....not couches. the history of baseball (and i'm guessing most sports) is littered with superstars who couldn't manage or coach anywhere near the level of their playing success.
hey - most prominent sports example today - isiah thomas. amazing player, incredibly inept manager of people / coach many times since his playing days.
Yes, it's coach not couch
