Spreading Forex

oldtime · Oct 22, 2011

ok, Thanks for the info. I'm just working with 25k units on 10 pairs over time. A full load would probably be about 250k per pair. But most pairs never get added to so some stay at 25k for a long time. And big losers get trimmed all the way back to 25k (25k at a time) if it is trending against me.

Jack_Larkin · Oct 22, 2011

Quote from oldtime:

ok, Thanks for the info. I'm just working with 25k units on 10 pairs over time. A full load would probably be about 250k per pair. But most pairs never get added to so some stay at 25k for a long time. And big losers get trimmed all the way back to 25k (25k at a time) if it is trending against me.

Not to harp on the 'losers average losers' thing again... but could you explain your edge in trading this way?

Why are you exposing yourself to so many variables? What advantage would trading like this have over something far more simple?

oldtime · Oct 22, 2011

Quote from Jack_Larkin:

Not to harp on the 'losers average losers' thing again... but could you explain your edge in trading this way?

Why are you exposing yourself to so many variables? What advantage would trading like this have over something far more simple?

well, now that's a very good question. This is just something I'm working on in a paper account. In the real account I'm all in or all out. But man it is volatile. Put it on get stopped out put it on get stopped out until I finally catch a wave. I keep it spread over 7 pairs each with equal amounts. But I don't have a big idea. This new method is my first attempt to trade a big idea.

Edge? well this is where you and I part company. I don't use an edge, I rely on luck and I can't tell you how many times I've been told "you'll never make any money that way." I believe luck is a force which can momentarily be harnessed. And I'm still living off the proceeds from one ES trade I made back in 2007. And I won't trade ES anymore. Something about lightning striking twice or just superstition or quitting while your ahead.

Jack_Larkin · Oct 22, 2011

Quote from oldtime:

...
Edge? well this is where you and I part company. I don't use an edge, I rely on luck and I can't tell you how many times I've been told "you'll never make any money that way." I believe luck is a force which can momentarily be harnessed. And I'm still living off the proceeds from one ES trade I made back in 2007. And I won't trade ES anymore. Something about lightning striking twice or just superstition or quitting while your ahead.

... *blinks* ...

We sure do part company in this respect...

Err... good 'luck' ?

oldtime · Oct 22, 2011

Quote from Jack_Larkin:

... *blinks* ...

We sure do part company in this respect...

Err... good 'luck' ?

thanks, and again, I do appreciate the info.

good edge to you too

cornix · Oct 22, 2011

Quote from oldtime:

my idea is to add to some winners, add to some losers and lighten up on some losers

So the purpose is more flexible position management?

oldtime · Oct 23, 2011

Quote from cornixforex:

So the purpose is more flexible position management?

right, constantly increasing and decreasing size. I'm hoping to spread the risk out wide enough that I can trade without stops.

cornix · Oct 23, 2011

Quote from oldtime:

right, constantly increasing and decreasing size. I'm hoping to spread the risk out wide enough that I can trade without stops.

The problem is: risk profile of such synthetic position is the same as outright position of a corresponding pair.

So you can actually do the same using just that (but that is not very safe risk management).

oldtime · Oct 23, 2011

Quote from cornixforex:

The problem is: risk profile of such synthetic position is the same as outright position of a corresponding pair.

So you can actually do the same using just that (but that is not very safe risk management).

no, when you spread it out over 5 currencies, all with changing sizes, the whole thing becomes very stable. My biggest worry is it is so stable I can't make any money.

cornix · Oct 23, 2011

Quote from oldtime:

no, when you spread it out over 5 currencies, all with changing sizes, the whole thing becomes very stable. My biggest worry is it is so stable I can't make any money.

No risk - no edge, that's an axiom besides some rare arb opportunities (though even there risk exists, just probability of a loss is extremely small).

I would say it's easier to simply trade the Euro baby outright.