What a difference a week makes

Was at -25K at one point yesterday. Now determined to change my strategy. Made 2K today, and now at -22K.

There are a couple of things that you always hear people say:
- never let a profit turn into a loss
- let your winners run

They seem to be at odds with one another. Let's say you go long on a stock and it goes up 20 cents. Then it drops 10 cents, and at that point you might want to close out to preserve the 10 cent profit. But then it could go up another 50 cents after you close out. Seems to me like you can only follow one of those rules, and not both.
 
Quote from interdigital:

Was at -25K at one point yesterday. Now determined to change my strategy. Made 2K today, and now at -22K.

There are a couple of things that you always hear people say:
- never let a profit turn into a loss
- let your winners run

They seem to be at odds with one another. Let's say you go long on a stock and it goes up 20 cents. Then it drops 10 cents, and at that point you might want to close out to preserve the 10 cent profit. But then it could go up another 50 cents after you close out. Seems to me like you can only follow one of those rules, and not both.
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never let a profit run into a loss is of course confusing and it shouldnt be the strictest rule to follow. Let your winners run makes a lot more sense but what you need to do is setting TARGET(S) and therewith find out about your TIMING. After you got the timing right you can start to play size. By reaching targets more or less often you can see how good your strategy is and if its good enough you can start to milk.
 
Quote from interdigital:

My account has consisted of some cash (had over 40K in cash last week, but now it's down to around 13K), plus a significant amount tied up in stocks. I've been daytrading, and shorting stocks for the most part. I prefer to go short instead of long, because if I have 13K of cash in my account, then I can only buy 13K worth of stock (or maybe a little more if I wanted to use margin). But since I have a large amount of money tied up in those stocks, then I can easily short 100K worth of stock per trade. I look to gain around 1% per trade, so if I short 10000 shares of a stock at 10, then I'm happy if I can cover it at 9.90 for a 1K profit.
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Why don't you separate your trading account from your investment account? Looks like you are just chipping aware from your safety net (retirement buffer?). It is not wise to be trading on the strength of your investments. How do you measure performance for each (trading vs investment). Again, it does not look like you have been trading for long enough or have some strategies with an edge under your belt. It is better to learn with smaller amounts of money!
 
Quote from interdigital:

I look to gain around 1% per trade, so if I short 10000 shares of a stock at 10, then I'm happy if I can cover it at 9.90 for a 1K profit.
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You are too subjective! You hope for a stock to drop in a way you can get some flesh out of the market. Now in debt 22k from a high of +40k? I urge you to stop immediately, as you are showing a significant lack of experience.
 
I guess I should have listened to you guys a couple weeks ago. But at this point I'm too deep in the hole and cannot accept such a huge loss. I will not keep doing what I've been doing though. A change in strategy is definitely in order.

This post by austinp is a good one:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=108656&perpage=6&pagenumber=3

I think one of my problems has been overtrading. I make trades just because the market is open. This must stop. No more trades out of boredom, desperation (making a trade just to try to make back a loss), or greed (making a trade just because I just made a good trade and think I'm hot). I will try to identify high probability entries and just trade those. I hope to cut down my number of trades from 10-20 trades per day down to less than 5.
 
Quote from interdigital:

...But at this point I'm too deep in the hole and cannot accept such a huge loss....
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many paupers are made this way.
 
Interdigital,

Hard to believe this thread.. Are you trading with an inheritance, lottery winning, or something?

Paper trade for a month or so.
 
Made $200 today. Problem is that it took 10 trades to do that. Was at +1K in the morning, then -2.6K in the afternoon, at least I got back to positive.
 
Actually it matters not what you made today . How and why did you make it? Put that in writing and see if it's repeatable..

Every trader loses a certain amount at which point they take a time out, start studying and improving the "process" of their trading. The "process" is designed to remove human nature from the equation because it is human to do EVERYTHING wrong in trading.. Not wishing you ill but you haven't lost enough yet..
 
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