Stop Losses are killing me

[ironchef]

funny you didnt even consider the risk but thats typical if demo account traders

Not risk if you know what you are doing sir. As always, the devil is in the details.

By the way do you trade for a living? If so, welcome to the club.

 

[ironchef]

chef,

you should compare the profit in relation to the risk, not just in absolute profit numbers.

You should compare the results with taking the same risk.
Let's say you want to risk $1400, that's the risk the loser took by averaging down.
If you would take the other strategy and add when the markets move in your favor, you could, with the risk at $1400 make $3920 profit instead of $2600 (the averaging down result).
The math: 1400/500*1400=3920.

Here is the used data:
loser ad = max risk was 1400
winner ad max risk was 500
loser add gain max was 2600
winner add gain max was 1400

I agree. I was just thinking out loud, presenting a different look at the problem at hand.

Not everything is black and white:

If I had no stop loss, max risk was if stock became worthless. My max risk was lower if I averaged down.

If the probability of reaching 3100 is 100% or very high, averaged down was better too.

Ultimately I suppose it is expectancy and probability that matters.

Regards,

 

[murray t turtle]

Yes! That's a top problem I've found in 20yrs daytrading. No one size fits all / each unique trading day. Especially tough when trading index-derived instruments like SPY.

There's strong trending vs choppy days; A or V shaped etc

%%
I have used a 55 day moving aVerage, like that grain/corn trader in Sucessful Farming[ He's been grain trading since 1974] .i prefer a 50 dma but I like a 55 better than 65, which is too little to late. WSJ likes 65dma may help sell papers/LOL
I like those cash etfs like spy or even a spy/spxl combo if i'm not very sure of a good trend[spy /spxl combo loses less than spxl, when i'm wrong]

 

[KCalhoun]

%%
I have used a 55 day moving aVerage, like that grain/corn trader in Sucessful Farming[ He's been grain trading since 1974] .i prefer a 50 dma but I like a 55 better than 65, which is too little to late. WSJ likes 65dma may help sell papers/LOL
I like those cash etfs like spy or even a spy/spxl combo if i'm not very sure of a good trend[spy /spxl combo loses less than spxl, when i'm wrong]

Good to hear it.... I'll be testing TNA vs SPXL for daytrading long next week...for bear bias my favorites are still TZA SDOW UVXY.... happy hunting!

 

[Williamharvard]

Stop loss is the best thing in trading as you don’t have to monitor your holdings daily.

 

[easymon1]

Stop loss

what's your method for stop loss placement?

 

[Corky5]

stop losses are not good for trading, especially day trading. Algo's can shake you out of an otherwise good trading set up.

 

[deaddog]

stop losses are not good for trading, especially day trading. Algo's can shake you out of an otherwise good trading set up.

How do you control your risk?

 

[bone]

stop losses are not good for trading, especially day trading. Algo's can shake you out of an otherwise good trading set up.

They are essential for swing trading. And a couple of millionaires who took me under their wings in the Pits would disagree with you about scalping without a stop loss

 

[murray t turtle]

Good to hear it.... I'll be testing TNA vs SPXL for daytrading long next week...for bear bias my favorites are still TZA SDOW UVXY.... happy hunting!

%%
Put in a sell order on a cash related version of spxl;
it may get get sold in the next 50 or 55 days/not a prediction. Some broker tend to hit stops + that can help sometimes /LOL................................................................