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

[pinkman]

Fullauto was probably talking about using options to hedge a futures position.

The other thing i've seen people do, (which was just mentioned in fact), is to abandon stops and use tiny position size instead, so that big moves don't hurt too much, and you can average in.
Kind of pointless, though. ROI might be better off in a high interest bank account!

 

[fullautotrading]

Quote from pinkman:

Fullauto was probably talking about using options to hedge a futures position.

The other thing i've seen people do, (which was just mentioned in fact), is to abandon stops and use tiny position size instead, so that big moves don't hurt too much, and you can average in.
Kind of pointless, though. ROI might be better off in a high interest bank account!

That too. Hedging is a relatively complex activity involving several components and which must be supervised algorithmically. It can include proper use of protective option configurations, multiple strategy layers with different and complementary scalping games, appropriate use of cointegrations, size calibration, diversification, dynamic capital reallocation, folio management, and so on. And, as far as I know this is the only robust way to achieve *systematic* profitability (in the role of a "market taker").

(If one trade only 1 futures with small capital, and no other instruments, that's rather a form of gambling, and there is not much you can do about it to turn systematically profitable. Just rely and on your information, and hope for the best.)

 

[Visaria]

Sounds expensive too

Quote from fullautotrading:

That too. Hedging is a relatively complex activity involving several components and which must be supervised algorithmically.

 

[fullautotrading]

Quote from Visaria:

Sounds expensive too

Losing $$$ also sounds pretty expensive. Especially with futures

 

[toolazy]

i have spent lots of time holding positions and couple of times...

market changed behaviour in instant in a shocking way so one just freezes.

I duno what else can save you from going under in such a case except:

- small position
- stop

playing small position is waste of time, so I always have stop.

And always measure performance of stops. and definitely pays. Of course, I do not put stop under most recent low or just under tl or 5c under pivot xxx.

 

[dealmaker]

Quote from dom993:

Not having a stop doesn't necessarily mean not having an exit plan.

Having an exit plan is a mental stop, thus a stop...

 

[wwatson1]

What a load of baloaney lol

 

[wwatson1]

Thats like saying if I see a cliff I'll just drive faster and put less people in my car ha ha

 

[Jaydom]

If you don't use a stop, you don't know what the hell you are doing. Simple as that.

 

[ras72]

I've come to the same conclusion as emg. Stops are for wimps ...and for those who don't know any better.

- ras72