"Scaling out" is inferior behavior
- Thread starter Buy1Sell2
- Start date
Nobody else seems to care and I know it's off topic, but I am curious.
What's the deal with the "new" airplane ? Can you really fly an airplane ?
Quote from optionpro007:
Nobody else seems to care and I know it's off topic, but I am curious.
What's the deal with the "new" airplane ?
It was a joke. I had some things that needed to be attended to that day and thought I would lighten things up a bit. I do have a certain amount of flight time with a sharing plan, but no personal plane.
It sounded pretty good though.....
I believe my average price on the short was roughly 1307 before the fall. I only hedge when I am long in ES once the market has advanced fairly well. I do sell calls when I am short as well as part of building a short position. My outlook since mid June has been long. This is well documented in my journal. The market may well start a sell off tomorrow, but as of the time of this posting, there is no obvious reason to be short this market.
Good luck to you Vol, I believe you may have a future in this business. It's been fun.
So you are still currently long right now ? If so when will you think about selling calls ?
Talking about inferior behavior and this is a different subject altogether, but can be linked.
When a buy signal is generated, would it be inferior behavior to close position before a sell signal is generated? Because if we do wait for a sell signal on most trades, then in theory all positions should be reversed at the time a new signal is generated. From what I have seen on ET, most traders would open and close positions, but would seldom reverse a position.
People like B1S2 and Spike500 would normally try to exhaust their position and when the move is over in their view they reverse initial position. Although I do not belong to that camp, I do consider this a superior way to trade. Of course sometimes there is no reverse signal and as B1S2 has said earlier on a trader will be forced to give back profits or even lose a bit on initial stop level. Intraday I still find it difficult to stay in a position "till the end" until a reverse signal is generated mainly due to lack of experience, hence the need to use scaling out. I am looking at a trailing stop, though a trailing stop can also be classed as inferior behavior as profits are protected, though potential full move is not being exploited.
Basically, should a trader strive to stay in a position until a reverse signal is generated or should he simply lock in profits? Hopefully I managed to bring the point across.
Opinions?
When a buy signal is generated, would it be inferior behavior to close position before a sell signal is generated? Because if we do wait for a sell signal on most trades, then in theory all positions should be reversed at the time a new signal is generated. From what I have seen on ET, most traders would open and close positions, but would seldom reverse a position.
People like B1S2 and Spike500 would normally try to exhaust their position and when the move is over in their view they reverse initial position. Although I do not belong to that camp, I do consider this a superior way to trade. Of course sometimes there is no reverse signal and as B1S2 has said earlier on a trader will be forced to give back profits or even lose a bit on initial stop level. Intraday I still find it difficult to stay in a position "till the end" until a reverse signal is generated mainly due to lack of experience, hence the need to use scaling out. I am looking at a trailing stop, though a trailing stop can also be classed as inferior behavior as profits are protected, though potential full move is not being exploited.
Basically, should a trader strive to stay in a position until a reverse signal is generated or should he simply lock in profits? Hopefully I managed to bring the point across.
Opinions?
One opinion.
A buy for me requires a signal with a particular certainty (say confidence = 75%) and a risk reward for the logical stop and likely termination area (even if you trail a stop you should have an idea how far a setup is likely to travel).
A sell for me requires a signal with a different certainty (say confidence = 60% that this move is "exhausted"). But it doesn't have to conform to stop and target disciplines.
That puts me in the "don't reverse" camp.
A buy for me requires a signal with a particular certainty (say confidence = 75%) and a risk reward for the logical stop and likely termination area (even if you trail a stop you should have an idea how far a setup is likely to travel).
A sell for me requires a signal with a different certainty (say confidence = 60% that this move is "exhausted"). But it doesn't have to conform to stop and target disciplines.
That puts me in the "don't reverse" camp.
I am no expert, but I believe that to be able to answer your question with any amount of certainty, one would need to know which market or markets you trade, which time frame(s), how much money you allocate to any one trade, and how that reflects on your portfolio.
How you place your "orders" in order to fill your position....your resistance to heat...and how many hours you want to spend in front of the computer everyday....
just kidding mate !!
For someone who advocates reversing positions upon fulfilled objectives, scaling into a position is the same as scaling out of a position -- it's just a matter of bookkeeping. Does it really matter whether you were long or short before the reversal signal was received, to determine whether or not you should sell/buy a whole position or just a partial? It doesn't add up.
Sigh . . . must . . . stop . . . posting . . . on . . . this . . . thread . . .