too much emphasis on defense in trading

Quote from bighog:

Sorry, wrong topic. meant for the defense and offence one....


See, i still make mistakes....:D

Off topic, but just a little note....A pass to ride the train to downtown Chicago from the burbs now costs $109.50 a month. probability still cheaper than driving a car to work but not cheap. Wonder what it costs from Connecticut to the Big Apple...YEA GADS!!!
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hey hog,

try $100.00 round trip from philly to manhattan....

:eek:
 
Getting more aggressive is how you improve. At some point you have to add to what you're doing to make more money, so its more like 'calculated aggressivenes'. Crying in your beer about how much you could have made had you put that trade on can bring you down like a loser sometimes (almost). I know for me being less defensive and openning up my stops and allowing stocks to go against me more made a huge upside difference in my winning % and profitability. To add to the sports analogies, being more aggressive doesn't have to mean swinging for the fences everytime, it can be more like trying to stretch a single into a double.


Here's my question. Two traders average $10k a month. Trader A is more defensive and averages $11k in winners and $1k in losers. Trader B is more offensive and averages $30k in winners and $20k in losers. Which trader would you rather be?
 
Quote from marketsurfer:

hi,

it is my contention that there is entirely too much emphasis place on defense instead of offense in the field of trading.

having a good offense is the key to making money in the market, defense will simply keep you liquid longer. most of what i have read ( extensive ) in the field stresses defensive tactics or how not to lose, instead of workable, aggressive offensive trading manuvers. aggressive is the key, and the ONLY way not to slowly grind away by placing too much emphasis on defense.


any thoughts?

surfer
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Yes, I believe that to score points the offense has be on the field longer than the defense.

This would suggest being in the market most of the time, no?
 
Quote from bighog:

WOW, this will never end....:D

Just goes to show that the statement: "This is what makes a market" is true.

We all play the same game but in different ways, some trade only stocks, some only futures, some options etc. Everyone plays the game in different mindsets, different time frames, different strats and tactical maneuvers, etc.

But i would bet the farm that most follow the same road to becoming a winning trader, even with different definitions of what a winner might be.

We start out with visions of grandeur, open an account and get our butts whacked. Go back and read some more books, try a few wizard letters, etc, find out that is useless also. Go back and read more books, this time we start to realize we are our own worst enemies and we then begin to analyze ourselves and not the markets. the bulb starts to get brighter as we become more signal oriented rather than throwing darts at the mkts

Then the day comes "FINALLY" where we start to realize that we were over analyzing the mkts with esoteric useless indicators etc.

We decide the simple stuff indeed works if and only if we get intellectually honest with the use of "STOPS" and use setups that are understood as their true usefullness and reliability. With that comes the awful truth that "LOSSES" are a large part of the game, they will "NEVER" be avoided. Losses are part and parcel to winning. Taking losses is a hard lesson to get imprinted in a brain when your whole life we are taught that losses make you a loser, a nit-wit, a bum etc. Some never get to that point in their trading career and they become a statistic amoung the dead and ruined.

AM i CLOSE?....:)
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Oooooo.....this be a good post!
 
dvshucks,

I would rather be Trader A who has a win/loss ratio of $11 to $1 versus Trader B who has a win/loss ratio of $3/$2.
All Trader A has to do is increase his number of contracts and voila, his gains will be huge!!!
 
Quote from ElectricSavant:

So if I have not had a losing day in nearly a year, I wonder if the wise man would tell me to prepare and trade defensively, as my day is coming?
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I dont think that;s the approach.

Losing or failing to achieve one's short term goals is a part of the learning process - you cant expect to be the best from day 1.

Once you get to the point of not having a losing day for a year -kudos on that btw- you've probably learned most of the lessons and you're advance in your learning process [though the learning process is never finished as one never achieves perfection] and your lossing days should be the exception not the rule.
But when you do have a lossing day you'll have the oportunity of learning a very valuable lesson. Such lessons become more valuable as you become as you advance because they become less and less abundant.
On the other hand, you could focus on a smaller time frame, instead of looking only for losing days, why not look for a losing hour? They should be more abudant, and give you many more learning oportunities.
 
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