Trading with a Stop Loss in the Futures Market is for Losers

Quote from emg:

Here is an interesting article:

http://www.chicagotribune.com/busin...-data-leak-20130424,0,4124230.story?track=rss

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HFT will stop small traders out. HFT will blow small traders far away.


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More than 90% of small traders lose! They just lose!





http://www.bloomberg.com/news/2012-...-seen-profiting-at-small-firm-expense-1-.html


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Chickens (small traders) are coming home to roost
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The key is not to try to emulate the big dragons - especially not through HFT. By pursuing your own proprietary strategy, you maximize the chance for success. Anyway, I'm happy not to belong to the 90-percent group... :)
 
Quote from QuantWizard:

The key is not to try to emulate the big dragons - especially not through HFT. By pursuing your own proprietary strategy, you maximize the chance for success. Anyway, I'm happy not to belong to the 90-percent group... :)
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Btw, I made $188 profit/contract on Apr 23rd, simply for the reason that my system is optimized to handle such "mini flash crashes". Keeping emotions out is a virtue!
 
Quote from QuantWizard:

Btw, I made $188 profit/contract on Apr 23rd, simply for the reason that my system is optimized to handle such "mini flash crashes". Keeping emotions out is a virtue!
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:)
 

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Quote from lemarche:

ABOSLUTELY FALSE !!... USING STOP LOSSES IS THE ***ESSENCE*** OF TRADING SINCE IT IS A STATISTICAL GAME...
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I agree, but you have to use them smartly. Check my attached pic.
 
ok previous post. well actually the stop should have been just below prev local low. these kind of crashes son t happen very often and of course algos are after your stops ! so you need to think about it BEFORE getting into a position so that can place a stop that has meaning
 
Quote from lemarche:

ABOSLUTELY FALSE !!... USING STOP LOSSES IS THE ***ESSENCE*** OF TRADING SINCE IT IS A STATISTICAL GAME...
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Exactly. If you don't have a pre-defined max loss point, you cannot judge statistical parameters of a trade correctly.
 
IF I used stops in my multi-year stock "trade", I would have lost 30k instead of made 100k.

and one guy who made billions in the subprime market (buying CDS) was famous for buying stocks that first fell about 20% before going up 500%. so he would have been stopped out.

most yen sellers would have been stopped out before the huge move to 100.

stops are easy to explain to morons, and they feel ok when they only lose $50 each trade instead of $200. they get to trade for a long time. this is an illusion of being smart.

if you want to make real money......NEVER use stops, except to lock in massive gains.
 
Quote from BlueTurtle:

IF I used stops in my multi-year stock "trade", I would have lost 30k instead of made 100k.

and one guy who made billions in the subprime market (buying CDS) was famous for buying stocks that first fell about 20% before going up 500%. so he would have been stopped out.

most yen sellers would have been stopped out before the huge move to 100.

stops are easy to explain to morons, and they feel ok when they only lose $50 each trade instead of $200. they get to trade for a long time. this is an illusion of being smart.

if you want to make real money......NEVER use stops, except to lock in massive gains.
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Would you still say "never" if I say I generated 200% over the last year through more than 400 trades using stops? And what if I say that the way I use stops maximize the return from my algo over a period of three years of back testing? I think you should be cautious about generalizing. What works for you doesn't work for everyone and vice versa.
 
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