Prudent Risk Management Is The Only True Edge In TRADING

[pinabetal]

It IS the only reason

Then why don't you forget charts and indicators ..pull a random price out of a hat and get really rich with just PRM. You don't need charts..indicators..etc. Why do you use them?

 

[BONECRUSHER]

Correct

So, why was the RSI and how you used it so important to your trading in the past?

 

[Zodiac4u]

One cannot run a business without Risk management. Biggest problem here I see, is that the majority of ET'ers don't run there trading as a real business.

 

[BONECRUSHER]

I think this is all semantics. Entries, exits, and sizing are calculated based on risk, no? It's all the same.[/QU or whatever.

One cannot run a business without Risk management. Biggest problem here I see, is that the majority of ET'ers don't run there trading as a real business.

One cannot run a business with just risk management...how about a niche? Agree that most traders don't use risk management optimally.

 

[Zodiac4u]

I used to think that about risk management, but now I'm thinking that's part bullshit. the debate should be about what part, does risk management play in a traders edge. No one in there right mind would pick a random point and just employ risk management, except maybe someone that trades customer funds. It would work but why bother to take on unnecessary heat? Why not look for value? A true edge requires specific rules for specific conditions.

 

[BONECRUSHER]

Correct. Most traders will not become experts at PRM. It's just not sexy. It is however the mother's milk of trading. --and most will never drink.

Doesn't "expert" imply a special skill or unique approach? Special skills and unique approaches are not simple or straight forward. If you have an edge built in to your "money management" because of some creative sequence or filter, then you shouldn't say money management is the absolute edge, because it's your own personal edge. Why do you imply money management is easy and makes easy profits, yet it takes expertise to accomplish? There can only be so many "experts" at anything!!!! P.S. I know you use the RSI frequently in your trading.

 

[achilles28]

Then why don't you forget charts and indicators ..pull a random price out of a hat and get really rich with just PRM. You don't need charts..indicators..etc. Why do you use them?

Because the trend is your friend?

 

[profitlocker]

Correct

Of course not

 

[Buy1Sell2]

Doesn't "expert" imply a special skill or unique approach?

No

 

[Buy1Sell2]

So, why was the RSI and how you used it so important to your trading in the past?

RSI is used along with other indicators and price to determine entry and exit. There is no edge in that. Everyone is able to pick good entries and exits.