EDIT: I am done engaging with you on this, giving me one word and one statement negatives answers. Does absolutely nothing for you or me.
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Position sizing and adding to winners.
- Thread starter Laissez Faire
- Start date
EDIT: I am done engaging with you on this, giving me one word and one statement negatives answers. Does absolutely nothing for you or me.
I give up. Must be me getting older, I just lose energy for things like this anymore. You can believe whatever you want. I did all I can do on this one.
It's ok man...
All I am saying is, adding to a trade on the levels we pissants do, will not move the market. We're little retail buggers who cannot move the markets. Our adding into positions will not move the markets in our favor. Have you looked at a ladder lately? How can our bits of noise make any difference in that major chaos?
And if you are tired of my huge red YES and NO bits, blame B1S2. I caught that bug from him when he was in TRUE and FALSE mode.
It's ok man...
All I am saying is, adding to a trade on the levels we pissants do, will not move the market. We're little retail buggers who cannot move the markets. Our adding into positions will not move the markets in our favor. Have you looked at a ladder lately? How can our bits of noise make any difference in that major chaos?
And if you are tired of my huge red YES and NO bits, blame B1S2. I caught that bug from him when he was in TRUE and FALSE mode.
It's fine doesn't look like we're going to get anywhere. I do want to clarify one last thing though. I didn't mean buying more will help move the market, just that one entry and one exit does not leave very much room for flexibility and requires pretty accurate trading as it gives you only one shot for entry and one shot for exit. Not everyone can trade multiple's though I understand.
Have a good weekend.
Far as I remember learning, entering and exiting the market at stops and targets was pretty much what reality is. I mean, you have gone way beyond the bizarre now, in simple reasoning. You are trying to reason me down to the point of something even MORE basic then hitting buy and sell? WTF? If you give me $300,000 for my futures account, I can show you what 1 contract can do. I just need a wide berth.
In a wide-ranging market, you need MONEY to have flexibility.
Ok, I don't understand because why would you need more cash in the account than the entire contract is worth? And if you need that much room to trade 1 contract, I don't think you'll be showing me very much because that would mean you're just letting it ride until / hoping it goes in your direction, which basically defeats the whole purpose of day trading.
But to each his own, have a good one.
Quoted for truth.
I don't mind losing money on a good trade, but losing money on bad trades...
Being selective and patient is a huge edge.
Well, I disagree. And I view it differently than you do.
When I enter a trade - I always have an anticipated scenario for how price will move towards my target.
Adding to a winner would then mean that I add units as price action confirms that my anticipated scenario is unfolding.
Here's a simple example.
Let's say I'm anticipating a strong move up and it starts with a breakout of the opening range.
1st entry - The breakout
So far, so good. Can it be a false breakout? It can.
2nd entry - Price pulls back and finds support at the breakout point. I add one more contract.
3rd entry - Price is still hovering over the opening range, but I know that as long as price does not dip below the range high - we're good for another push higher. So, I add one more contract as price once again breaks higher.
I exit all contracts near the top at my anticipated target.
This example shows that as price confirms I'm right - I'm taking on more size. If I were stopped out on the 1st entry - I would have taken my loss on my minimum size.
There is no answer for that question that will cover all different trading methodes that are used.
You first need the statistics of a specific trading system to try to simulate if it works or not. And it will be only valid for that specific trading system.
A lot of factors have an impact on what works and does not:
If you average profit is at 5 pts and your stop is at 5 pts, you will quickly lose 50% more in a losing trade than you win in a winning trade. See difference between sample 1 and 2.
If you would have 2 consecutive bad trades (stopped out) your buying power can drop quickly with 75%.
So all depends of the stats of your system. Be careful because it can be a very dangerous game and I don't know if this tactic is worth the risk you take. Because you already use leverage, and that will reduce the possibilities you have to correct a situation that goes wrong because the leverage works against you when you are in a losing trade.
Your winning rate should be high and your average loss per losing trade should be small.
And you should avoid in all cases to have 2 consecutive trades that are stopped out.
You first need the statistics of a specific trading system to try to simulate if it works or not. And it will be only valid for that specific trading system.
A lot of factors have an impact on what works and does not:
- margin
- average profit per winning trade
- average loss per losing trade
- % of winning trades
- number of consecutive losses
- ...
- sample 1: we buy 2 ctrs ES and add later 2 ctrs; we go flat 5 pts higher. We made profits and can open the next trade with 7 ctrs buying power.
- sample 2: we do exactly the same as in sample 1 but get stopped out. We are stopped out 5 pts lower. We made losses and can open the next trade with only 2 ctrs buying power. So losing $ 1200 means losing 60% of our buying power. We have to recover with 1 ctrs a 4 ctrs loss.
If you average profit is at 5 pts and your stop is at 5 pts, you will quickly lose 50% more in a losing trade than you win in a winning trade. See difference between sample 1 and 2.
If you would have 2 consecutive bad trades (stopped out) your buying power can drop quickly with 75%.
So all depends of the stats of your system. Be careful because it can be a very dangerous game and I don't know if this tactic is worth the risk you take. Because you already use leverage, and that will reduce the possibilities you have to correct a situation that goes wrong because the leverage works against you when you are in a losing trade.
Your winning rate should be high and your average loss per losing trade should be small.
And you should avoid in all cases to have 2 consecutive trades that are stopped out.
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Calm down, already.
The logic you're trying to imply is already a given, so you don't need to be stating the obvious. The assumption is a retail trader in a liquid futures market. I don't see anyone suggesting that a retail trader is moving the market.
Adding to a winning position as I suggested it means adding positions as price action is proving you right. Obviously nothing to do with those orders moving the market.