When to Stop Trading After Losses

[guowei58]

Hello All,

I day trade the CL and ES futures. I am risking 2% of my account capital per trade.

My problem is I am not sure when to stop trading during the day after X amount trades that lose (i.e., stopped out). Right now I just stop trading after about 3 losses but always feel the needs to get the PnL back to breakeven and keep trading, and this leads to over trading.

Questions please:

1. What money management rules do you have set in your trading plan that you follow to stop trading for the day?

Thank you kindly.

Trade smaller (like 0.25% or 0.5% of your capital) and take all your signals...stop trading when you think your system is not working anymore (probably after 2k trades)

 

[SimpleMeLike]

Trade smaller (like 0.25% or 0.5% of your capital) and take all your signals...stop trading when you think your system is not working anymore (probably after 2k trades)

guowei58,

Thank you so much for the response. I like the X% of capital risk management approach.

 

[Gaslight Capital]

What money management rules do you have set in your trading plan that you follow to stop trading for the day?

Most days I trade bell to bell and unless we have news pending, e.g. Beige book, Fed meeting notes, Fed rate decision, Presidential election, I take each and every set up.

 

[GuerrillaTrading]

Hello All,

I day trade the CL and ES futures. I am risking 2% of my account capital per trade.

My problem is I am not sure when to stop trading during the day after X amount trades that lose (i.e., stopped out). Right now I just stop trading after about 3 losses but always feel the needs to get the PnL back to breakeven and keep trading, and this leads to over trading.

Questions please:

1. What money management rules do you have set in your trading plan that you follow to stop trading for the day?

Thank you kindly.

Don't ever chase losses trying to make your money back. It's psychologically and financially detrimental. In poker it's referred to as 'full tilt.' You just need to step back and re-group, clear your mind, stay disciplined and get back on the horse when you're ready... you'll know when that is.

 

[SimpleMeLike]

I take each and every set up.

Thank you Gaslight Capital, good comment. Taking them all helps with regret.

 

[SimpleMeLike]

Don't ever chase losses trying to make your money back. It's psychologically and financially detrimental. In poker it's referred to as 'full tilt.' You just need to step back and re-group, clear your mind, stay disciplined and get back on the horse when you're ready... you'll know when that is.

Thank you GuerrillaTrading

 

[murray t turtle]

You missed my point. If you are making money buy and holding, and you are losing money day trading, stop day trading.

%%
Good points.
Another way to do it/cut back when you lose short term trading.
And keep in mind most lose money daytrading/except market makers/specialists.[NOT saying anyone should short term trade or buy + hold, even though most money is made in markets that latter way.]
OF course if one has a real low hit rate/ maybe no need to cut back.
Common sense may apply ALSO.
I COULD BE super bearish on SPY/VOO,[down SEPT,oct] but im not=4th quarter seasonals+ 88% of UP January=good up year...……………………………………………………………………………………………………...,