i can assure you that most of the 95% that fail is from using a method similar to yours and not knowing when to say when and continuing to add.....putting that aside, I think your method in the right hands can work wonders .I use a similar method in some cases; not always getting the results i would want...peace
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Money Mgmt beats Stops Everytime - Example
- Thread starter ProfitTakgFool
- Start date
i can assure you that most of the 95% that fail is from using a method similar to yours and not knowing when to say when and continuing to add.....putting that aside, I think your method in the right hands can work wonders .I use a similar method in some cases; not always getting the results i would want...peace
Quote from ProfitTakgFool:
Yes, EXACTLY. I'm buying when the rest of the world is selling. You think about that!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! 95% of futures traders fail and I'm buying what they are selling. You can't see that this is a SUPERIOR Way????? ROLF like I've never LMFAO before. Hillarious dude.
Hilarious? You adding on the way down is what's hilarious.
You call that money management? I call that a race to zero
Quote from athlonmank8:
Hilarious? You adding on the way down is what's hilarious.
You call that money management? I call that a race to zero
he is not adding up ad infinitum. At some point he will close the position for a loss. It is just that his stops are further away than those of most other traders.
Quote from Mike805:
How long have you been trading *profitably*? Do you trade index futures or stocks? Do you understand elasticity, value areas and mean-reversion?
You're either new to trading or you do not have a firm grasp of intraday market behaviour.
That's a nice way of me saying that your logic is amatuerish at best.
Mike
I do, but we may be talking oranges and apples here. Are you buying the lows on a downtrend or are you buying a pullback on an uptrend.
Two totally different things, but sound the same.
I'm new? No i'm not new, but i have found every losing strategy under the sun until someone on this site helped to wake me up.
This strategy was one of the hundreds.
With that said there is ultimately ONE way to play this strategy. With about .5% of your portfolio and use RIGID stops. Then you're "ok."
But for most traders that's too boring and risk-adverse.
Quote from shortie:
he is not adding up ad infinitum. At some point he will close the position for a loss. It is just that his stops are further away than those of most other traders.
His stops are further away? Who gives a shit. He's adding on the way down. REAL traders add on the way up.
No they don't. Go down to the CME and watch how they trade. Why do you think they are so interested in if "there is paper coming in?" If you trade a nickel and dime account you can't do this. You have to have access to substantial size and buying what the rest of the world is selling is absolutely the way real traders make money.
Quote from athlonmank8:
His stops are further away? Who gives a shit. He's adding on the way down. REAL traders add on the way up.
Quote from athlonmank8:
I do, but we may be talking oranges and apples here. Are you buying the lows on a downtrend or are you buying a pullback on an uptrend.
Two totally different things, but sound the same.
I'm new? No i'm not new, but i have found every losing strategy under the sun until someone on this site helped to wake me up.
This strategy was one of the hundreds.
With that said there is ultimately ONE way to play this strategy. With about .5% of your portfolio and use RIGID stops. Then you're "ok."
But for most traders that's too boring and risk-adverse.
I buy when my system says to buy. This could be either below prior lows, or, at the breaks of a certain techinical price points i.e. drastic/sharp moves down.
One of my strategies that buys drastic down moves fails miserably when hard price based stops are used. That's because from a purely systemic standpoint - it is near impossible to pick bottoms - I can prove this BTW.
The key is that you have to be willing to take on and deal with the risk and more importantly - the fact that what happens after the trade is UNCERTAIN... there is a probability involved, but, one has no idea how far down a move will go until some reversion occurs. That means your stop is just as likely to get hit as is your target...
Of course there are occasional large losses, there is no way around losses. In my 10+ years of trading every good strategy I trade and have traded requires the ability to deal with discomfort and uncertainty. The better ones cause the most "discomfort". If you're doing something that "feels good" or gives you a sense of security, you're likely doing something wrong. Price based stops, in my opinion, give one a false sense of security.
Note that I average down when I believe the low has already been made and the price is entering value again. This is an >80% probability setup. But, as many have mentioned, if you can't or WON'T take that loss when is time to close the trade, you will blow up. That's true of any trading style. Mine just happens to use time, not price to exit a losing trade.
Quote from ProfitTakgFool:
No they don't. Go down to the CME and watch how they trade. Why do you think they are so interested in if "there is paper coming in?" If you trade a nickel and dime account you can't do this. You have to have access to substantial size and buying what the rest of the world is selling is absolutely the way real traders make money.
What are they doing? Standing in front of 52-week lows? Shit's down there for a reason. Unless you want to hold a pile of bags, you DON'T buy all-time lows (including daily lows).
It may be different from a long-term perspective but regardless, you're gambling.
Follow the pros. You need to understand these things. You're on the right track with the data set argument. But somehow you managed to screw yourself up along the way.
Where do you come up with this shit?
5 years I played bottoms like you did. And it got me to flat if not a little down.
I know first hand what you're doing and IT DOESN'T WORK RELIABLY ENOUGH.
2nd your exits suck. If you're going to pick bottoms, you don't scalp for 2 points.
The whole point of picking a bottom is to catch the "big run." Not scalp them. Why not scalp flow if that's the case? A lot easier.
I know first hand what you're doing and IT DOESN'T WORK RELIABLY ENOUGH.
2nd your exits suck. If you're going to pick bottoms, you don't scalp for 2 points.
The whole point of picking a bottom is to catch the "big run." Not scalp them. Why not scalp flow if that's the case? A lot easier.
If you pick bottoms I'll give you the best advice ever.
1)Play them small.
2) Don't average down
3) Pick them systematically (yes this is possible but the reliability is MUCH lower). When you "think it's bottomed" is not the definition of systematic.
4) Use tight stops
5) Get away from the computer and let it run big (don't even think of looking at it).
6) (for the advanced) ADD on the way up.
You failed 2, 4, and 5.
1)Play them small.
2) Don't average down
3) Pick them systematically (yes this is possible but the reliability is MUCH lower). When you "think it's bottomed" is not the definition of systematic.
4) Use tight stops
5) Get away from the computer and let it run big (don't even think of looking at it).
6) (for the advanced) ADD on the way up.
You failed 2, 4, and 5.