I'm saying that my risk management is built in to the amount I put in the trade in the first place.
For now, that works for me.
Looong weekend...
- Thread starter kmiklas
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I'm saying that my risk management is built in to the amount I put in the trade in the first place.
For now, that works for me.
But it HASN'T! You put on 7 contracts into CL on an unhedged position, knowing the range the thing has had, and now you have 1.1 ES unhedged! You are playing with FIRE!
I don't care what you think the market is going to do. You want to play with an unhedged swing in your account, on ES June, in this environment? You better have 6 figures in your account. I ain't joking on that.
Is my math correct?
If it goes down to 2100 from where I bought at 2697, that's 597 points.
With 11 contracts, 597*5*11= $32,835 I would need to import into the account to keep it going.
Sure. What percentage of that is your account? If you have 320K in your account, yer at 10% drawdown. Many would say that is unwieldy.
Right re timing, I scale in and out daily, short 2-4 day roundtrips... I'm up a bit today, I trade SQQQ TVIX VXX SOXS etc
I don't look at it as a % of an account. I look at it as...
How much money am I willing to risk trading? It's a % of my total money that is mostly in other places (not in brokerage account).
I only have time to pay attention to a few trades maximum at a time. And if I wasn't going to use the money in active trades, then it wouldn't be in my brokerage account... It would be in a checking account.
I am often wrong when I trade swing/longer term futures, when entering underlying, I am 1 to 1 regarding options value to underlying but have to get more options than underlying as they do not go one to one in reality, further away from strike price, cost of options are lower, so in your case your can put hedge on at the amount your protective stop if you don't want to pay high of ATM, so when stop is hit in futures, keep the hedge on in hopes market will continue going against original direction of the underlying to re-coup your loss on the futures.
In my case, hedges not on 100% of the time, they stay on till underlying reaches certain percentages then exited. So I won't make biggest amount if profitable on the underlying, but trading model is only correct 5-15% of the time and when I exit I lose hundreds but not entire cost of option. But when market does grant me profits, whatever is lost on options is so small compared to profits, to me only makes sense to do. At some brokers, they will keep margins reduced cause of the hedge.
I do have losses from time to time, but percentages are small, so drawdowns are much smaller than average trader. I prefer this style of trading, I don't not like wild swings in my accounts, prefer much smoother equity curve. I don't like to get excited on wild swings one direction or the other, I do not view that as being prudent business owner.
It seems to me that a trader needs to have a rest from time to time, because there is nothing worse than starting to trade tired or without proper emotional mood. I can say for sure that in those times, when I was pushing myself into strict limits and didn't allow myself to relax, nothing worked out. I really constantly thought about trading, about making money, about being always on top of it, and that's why I was constantly losing. But when I learned to give myself time to rest and find time for something other than trading, my performance became much better. Trading is a good business and has great prospects, but it's not the whole life and you have to give yourself the opportunity to rest and reconsider your views on life.
Some places like where I'm at its a 4 day Holiday (Good Friday, Saturday, Easter Sunday and Easter Monday).
Not trading today. Reality, its a long 5 day holiday although can't go anywhere due to the Coronavirus Easter.
Girlfriend is an ICU RN...won't be seeing her during the holidays. She's doing double shifts and will be staying at my condo (its near the hospital) while I stay at my home...again...thanks to Coronavirus.
Will be playing a lot of monopoly, chess and watching The Walking Dead episodes with my gas mask wearing teenagers.
wrbtrader
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I don't think that weekends and holidays are a reason to relax at all... You can spend that time reading some thematic reviews and articles, I never have time for that on weekdays... In addition, you can watch some webinars or video lessons that will be useful in your future trading. Last but not least, the fact that the same monthly action plan cannot be done in half an hour, you really need to review a lot of information and it also takes time... So yes - most weekends are free from trading, but you still spend them for future trading. I'm not even talking about those who trade crypto... So...