I have trouble finding 10 A grade trades a week much less 10 per day. Must be too picky!!
Undertrading vs Overtrading.. your thoughts?
- Thread starter KCalhoun
- Start date
Not if the winner is about to turn into a loser as you suggested. I call it taking a planned exit. I never get the top.
So you turn your winner into a BE. That is the only way to prevent that. But it is also not "letting your winners run".
The whole notion of "cut losses early, let winners run" is so cliche' it is remorseful.
Cutting losses early is death by a thousand cuts. You know this.
I was with a firm many years ago where trailing stops were absolutely forbidden. For good reason. I will never use one again.
In thinking about this a bit further, I will give you an example. I entered the MYM at a certain point on Wednesday evening. My target was set to right around the ~300 point profit mark, which was ~35K. The thing got to within 100 points of target on Friday morning.
Now, I could have set a trailing profit stop on that when it went 200 points in profit. But that was not my target. I am letting that winner run.
So what happened? Currently it is in the opposite direction, DOWN 300 points.
So. What should I do? Cut the loss now? Is it early? Is it late? What it comes down to in my mind is that there is only one fast and hard rule when it comes to trading an INDEX. Set your target and ride the waves.
I think that is a disadvantage I experience when getting into conversations like this, because I never focus on individual stocks. An individual S&P stock could collapse to zero in a week while in that same week the index itself just keeps going up.
Hey uh, Ken? Don't let me get into conversations like this anymore. You trade single-stock names, I do not. So you are better-suited to make sense on these things.
I think it is more wise to view the market as paying you to trade when you end up making money.
So when I sit down - the market has to make me take a trade I want to take. If it doesnt IDC because tomorrow could be a super strong rally where I make 40pts. There will always be a trade to take at some point. If not today, then probably tomorrow - whats the rush exactly? People get in a rush to make money a lot of the time - I know i do.
Point is, instead of the market causing me to run around with my head cutoff, I observe it until the Algos (ES) tell me to jump on the train.
So when I sit down - the market has to make me take a trade I want to take. If it doesnt IDC because tomorrow could be a super strong rally where I make 40pts. There will always be a trade to take at some point. If not today, then probably tomorrow - whats the rush exactly? People get in a rush to make money a lot of the time - I know i do.
Point is, instead of the market causing me to run around with my head cutoff, I observe it until the Algos (ES) tell me to jump on the train.
You really should not have typed that, because you know I have a video about things like that. Tonight I am feeling triggered. I need a cig first though.
Here is where we operate differently; I trade singe stocks although I could trade an index ETF.
I enter at $100 and my stop is $ 92. I have no target; only for the stock to move above 100 and keep moving up. I put a trend line below the lows and when the price breaks the trend line I exit. I have no limit on how much I can make. I have a limit on what I can lose.
I don't need many trades a year that run to multiples of my risk to make a decent return. Cut losses and let winners run.
Agreed. The damned futures have that sticky little expiration date which stocks and ETFs do not have. Different worlds. *sighs*
But we're doing the best we can, man. We just gotta' SAY IT! LET IT OUT LET IT OUT!