Do you miss expiration dates often?
Trading Profits
- Thread starter Utah
- Start date
Do you miss expiration dates often?
Are you missing the salient point here? I'm looking for a hedge against the next correction, or market crash of 30-90%?
Am I insane to look for this solution? Geez, you guys make it seem like I'm a shitty folk for even suggesting the idea. How do hedge funds do it then? By not hedging?
My trades don't last more than a week ,never enter a trade with a full position, use 2 or 3 entries if the trade goes in your favor,,,,, and use 2 or 3 exits at a % that you feel comfortable to make a profit , on your 1 and 2nd exit place a limit order to sell so you can sleep at night ,and the real money is made in your 3rd exit , let the market do their job, I trade no more than a week , price action is what moves the market in a very short term,,,, do not let your options expired or loose to much , if you see that your trade is not going your way ask yourself " would I make the same trade right now" ? Remember that the unknown happens all the times in the stock market, doesn't matter if you trade short or long term ,you need to hedge your trade
With those statistics, you are on your way to becoming a successful trader. It may take a while longer, and there is obviously a lot of work to do, but I encourage you to hang in there. I traded 14 years before I had a profitable year. Haven't had a losing year since. (That was 1984.)
As a flat-eod futures day-trader, the omnipresent "hedge" is to flatten or flatten and reverse.
For hedging an omnipresent black swan, trader setup should provide for server-side stops.
None of the above offers protection if the instruments' exchange goes dark, especially in combination with a wrong-way black swan. As a flat-eod day-trader, daily, that is the risk I take ... think I'll go for a drive now.
For hedging an omnipresent black swan, trader setup should provide for server-side stops.
None of the above offers protection if the instruments' exchange goes dark, especially in combination with a wrong-way black swan. As a flat-eod day-trader, daily, that is the risk I take ... think I'll go for a drive now.
I don't think 5 year is long enough time to prove sustainability if you trade for a living, need to put food on the table with your profit.
Who the hell are you to "judge" what is an acceptable way of life for someone else? $1.49 nuggets, 1.29 for 2 tacos, a buck for 3 or more "instant lunch" soup cups. Eat for $3 or less per day!! What's that you say, the residence zipcode doesn't meet your muster? Too bad for you!! There are plenty of bios of (now) well knowns in almost every field that did whatever it took, for however long it took. In the investment field, Chris Gardner (movie - The Pursuit of Happyness) comes to mind. That is but one. Happyness is not a typo.
Back on topic, why does length of time even matter? You are maybe confusing an independent trader trading for self (I wonder where THAT money came from) versus someone soliciting to run your money. I hope you don't use that criteria to choose your brokerage house. Pretty sure Lehman, MFG, Bear, etc all had multiples of a 5 year record.
Oh man, the first post is so wrong, hope no one is taking that advice. Isn't Edd Thorp a successfull trader? well, he said "master hedging and scale out of losses" advice that has let me not only survive black swans countless times but also allowd me to come out of the event with 6 figure profits. Same goes for the last part of the post... being convinced that the trade is good does not stop a tweet or black swan from making it go bad even temporarily but seriously enough to blow the account if a hedge or STOP wasn't in place.
The second post contradicts the first, can I then assume that you dont't know what hedging is?
An essential part of being a successful trader is to preserve capital, S/Ls don't always achieve this as many STOPS in a row can deplete capital, whereas hedging can keep a status quo even when markets turn against the positions. Ideed good trading requires the trader to be in the right direction most of the time, but even this, requires protection against temporary reversals... STOPS can often turn an otherwise good position into a loss, hedging can save the position untill the temporary reversal recovers.
Hedging does have a cost but using it can also give the trader >3,000 ROI compared to >200 ROI when using STOPS on the 1:3 principal. So, if you scalp then continue with the S/L strategy, but if you trade on fundamentals then hedging is the way to go... remain convicted to the fundamentals but take out insurance against sentiment swings, when sentiment goes against the fundamentals then, rather than STOP the positions, add to them, being hedged will allow you to do that and come out the other side with 6 fugure profits.
Last edited:
You misunderstood what I said. If you need all your profit to live, sooner or later you will be wipe out because the chances of you not have a drawdown is very low. When you have a drawdown and are forced to eat your capital, you will go out of business. That is why most traders need a day job.
The other issue is no one wants to trade and live hand to mouth for the rest of his/her life. To improve your lifestyle, you do need to be able to compound your capital base from accumulation of some of your trading profits.
But to each his own. I know what is best for me and only you know what is best for you.
Have a good day.