I'd like to hear this too. Since we are talking about SPY, there's plenty of liquidity for everyone and these random entries won't compete with your trades, you have no reason to decline.
Prudent Risk Management Is The Only True Edge In TRADING
- Thread starter Buy1Sell2
- Start date
I'd like to hear this too. Since we are talking about SPY, there's plenty of liquidity for everyone and these random entries won't compete with your trades, you have no reason to decline.
Your wasting your time. B1S2 doesn't trade intraday. That random entry shit with prudent stops will put you through the meat grinder. I'm sure he means well, but his basis is on longer term stuff, in which case random entry with very favorable R:R ratios can possibly work
He mentioned "extremely healthy profits" which suggests huge returns with low risk.
Now, if we are talking if by some chance random entries with MM can make ANY return then probably yes. Then again, so can any random trend following strategy with no MM.
risk management(know to admit when your wrong) + higher percentage of winning trades = wealth beyond imagination
no risk management + higher percentage of winning trades = stasis or even loss of wealth
risk management + low percentage of winning trades = wealth
no risk management + low percentage of winning trades = poor house
..the above is all you need to know about trading...develop your skills to get a higher percentage of winning trades and use risk management.
Chris
no risk management + higher percentage of winning trades = stasis or even loss of wealth
risk management + low percentage of winning trades = wealth
no risk management + low percentage of winning trades = poor house
..the above is all you need to know about trading...develop your skills to get a higher percentage of winning trades and use risk management.
Chris
Percentage of winning trades is almost completely irrelevant. It's the sizes of your winners and losers that decide your results.
If you disagree, why don't you just short puts, you can probably achieve 96-97% win rates but the losers won't be that amusing for your equity curve.
It's amazing what kind of "advice" is given on this site, I sure hope all the newbies don't accept it at face value and make up their own mind through trading.
If you disagree, why don't you just short puts, you can probably achieve 96-97% win rates but the losers won't be that amusing for your equity curve.
It's amazing what kind of "advice" is given on this site, I sure hope all the newbies don't accept it at face value and make up their own mind through trading.
I would like to swing trade SPY using end of day data.
Possibly you could outline a specific risk management strategy that could be traded with a random entry.
just look at the 2hr chart using EOD, draw your trendlines/support/resistance. Place a buy or sell stop order above or below the trendline based on the direction its breaking. If prices are stepping down, your trendline will be negatively sloped. So your buy stop order with stop loss would be slightly above the trendline. Calculate what effect your stop loss value will have on your account. If your stop loss gets hit and you loose 10% of your account, you will only be able to trade 10 times before you run out of cash or hit margin limiting criteria. The price action dictates your stop loss size, if the variance is high and your stop loss is within the variance zone, most likely it will be hit. If your unable to place a stop loss outside the variance zone, than your account size is too small to trade that derivative. If your buy stop on a negatively sloped trendline gets hit and your stop loss doesn't get hit, the previous intermediate term highs and lows will dictate where to exit the trade or TP /take profit.
Certainly. Pick a random entry and place a stop that will lose a small amt if wrong. However , if right, let it run placing protective stops outside the noise. It's that simple.
Actually I do trade intraday. Prudent risk management is the only true edge no matter what the time frame. Reminder, Prudent risk management is not just about placing an initial stop, it's about cutting losses short but also letting winners run.