Never add to a losing position?

[achilles28]

Quote from vhehn:

After being there a few months (and putting in some very good returns) he called me and told me what he observed. He told me there were dozens of different funds there and some had been in business well over a decade. Some managers traded stocks, some traded bonds, some used fundamental analysis, and some simply traded throughout the day. But the only single thing the majority of them had in common was that they "scaled-in to positions". When they had conviction in a position, no matter what their style was, they bought more as price dropped.

As you likely know, in most books this is taught as a recipe for disaster. Isn't it taught never to buy more lower? Yes, it is. And who teaches this? Not the best hedge fund managers in the world. These people buy lower, and if given the opportunity, they buy even lower (I remember one 30-year veteran of the industry telling me to buy a stock he liked, and to go home and hope it drops so I could buy more at an even lower price...this man helped create wealth for some of the most successful people in the country for three decades using this exact approach).

http://www.tradingmarkets.com/.site...ow-To-Correctly-Buy-Stocks-And-ETFs-82582.cfm

That's a ~reverse martingale. Double up after each consecutive loss.

Not a good idea. Demo it. I imagine it'll generate longer equity growth with patches of severe drawdown.

When entries are the problem, work on entries. Market is technical in the short term. Look for logical areas of support/resistence/fib confluence, multi-time frames, use price action, sell on pullbacks, buy on dips, use trader vic setups. Cut losses short and take another stab at the next window.

Contemplating averaging down means you can't short-term trade. Learn that, instead of gambling account equity praying for rain. My 2 cents.

 

[thisisnotsurfer]

Quote from achilles28:

That's a ~reverse martingale. Double up after each consecutive loss.

Not a good idea. Demo it. I imagine it'll generate longer equity growth with patches of severe drawdown.

When entries are the problem, work on entries. Market is technical in the short term. Look for logical areas of support/resistence/fib confluence, multi-time frames, use price action, sell on pullbacks, buy on dips, use trader vic setups. Cut losses short and take another stab at the next window.

Contemplating averaging down means you can't short-term trade. Learn that, instead of gambling account equity praying for rain. My 2 cents.

Reverse Martingale? That is a Martingale...... .....??

TINS

 

[Free Thinker]

Quote from achilles28:

Contemplating averaging down means you can't short-term trade. Learn that, instead of gambling account equity praying for rain. My 2 cents.

lol. you really think hedge fund managers like eddie lambert sell their positions if it goes against them a little?

 

[achilles28]

Quote from vhehn:

lol. you really think hedge fund managers like eddie lambert sell their positions if it goes against them a little?

You're not Eddie Lambert.

 

[Free Thinker]

Quote from achilles28:

You're not Eddie Lambert.

this whole thread is about how the best hedge fund managers operate. the evidence seems to show they do not operate as you suggested. many do add to losing positions. maybe you could learn something from them. just my 2 cents.

 

[achilles28]

Quote from vhehn:

this whole thread is about how the best hedge fund managers operate. the evidence seems to show they do not operate as you suggested. many do add to losing positions. maybe you could learn something from them. just my 2 cents.

When i've got 9 zeros on my account, yea I probably could. Until then, it's just boring reversals and pullbacks for me. Cheers.

 

[Pension_Admin]

Quote from vhehn:

lol. you really think hedge fund managers like eddie lambert sell their positions if it goes against them a little?

It's Eddie LamPert, with a "P". And where did that come from? Achilles28 didn't mention anything about Eddie Lampert or closing a position if it goes a little against you. You can't just stuff that into someone else's mouth.

Now is this nonsense? You tell me!

 

[Free Thinker]

Quote from Pension_Admin:

It's Eddie LamPert, with a "P". And where did that come from? Achilles28 didn't mention anything about Eddie Lampert or closing a position if it goes a little against you. You can't just stuff that into someone else's mouth.

Now is this nonsense? You tell me!

"Cut losses short and take another stab at the next window. "

are your glasses fogged up?

 

[Pension_Admin]

Quote from vhehn:

"Cut losses short and take another stab at the next window. "

are your glasses fogged up?

Cutting losses short doesn't necessary mean closing the position when it goes against you by little. There is a HUGE difference.

Stop making stuffs up. If you are unclear of something, all you have to do is ask.

 

[thisisnotsurfer]

Quote from vhehn:

this whole thread is about how the best hedge fund managers operate. the evidence seems to show they do not operate as you suggested. many do add to losing positions. maybe you could learn something from them. just my 2 cents.

Exactly. these eliters simply seem not to understand.

Keep up the good work!

TINS