it seems we all have our entry rules,but what really matters is how to deal with a trade "after" entry .what are the best money management /risk management methods in our opinion ?
There is no one-size-fits-all answer, as the answer is based on any or all trading signals, techniques, account size, trade size, back test results, risk tolerance, experience, etc. With that said, in ALL cases, you need to KNOW AT TIME OF ENTRY, where/when your loss management (ie risk) takes affect. That can be money-based(instrument price or account value based), technically-based, time-based, or discretionary. The key is... maintain the discipline to adhere to the rules that you have created. The market is ALWAYS correct.
How about starting other way, what patterns should we look for you not take good signals? I will start with Megaphone patterns as these are trend trade killers.
Unfortunately I love them. Actually... Anything volatile I like. My Ideal Risk Management is Antifragile. I've read taleb a lot. Practiced & Reflected a lot. Past decisions matters as much as current ones. Since there is path dependence ... As Handle says: To not put yourself at risk is already a wise decision.
Handle,i know this pattern by my own backtest but i was not aware of the name. thanks it's a trend killer ,but Megaphone days may have opportunities .in your charts an EMA goes to middle of candles (goes through them) in the initial phase of chart as well as volume increase in pullbacks on megaphone's lines.BB and maybe other types of channels may offer trades for this chop markets .i hope i can get what you mean clearly. you mean in these days you are not interested to trade at all OR you just don't trade your trending strategies due to your own money management rules OR you trade these days with strategies designed for congestive/chop market?
I won't take any trend signals where they are breakouts of highs or lows till price has moved enough to be out of the funnel shape. I am not much of a trend trader to start but getting in 2/3rds from the low or higher would often be losing trades for me, whereas trend trades where I entry near bottom third offers better chance of exiting near high.
I also use thirds. Sometimes I'll play strength, Which is price expansion that stays in a third. Either upper one when bullish or lower one when bearish. Or I also play pullbacks, retracement at about the opposite third. However I also watch Order Flow & Deep of Market for confirmation. I am trying to incorporate average swing size but ... Not done yet. And thirds are recursive. So I watch lower & higher ones too.
you should have a really low percentage of loss in your strategy to be anti fragile.so instead it means you 'll not have big profits and and nether big drawdowns ,but you'll move forward consistent .Nassim Taleb reveals hidden & unknown risks which turns into reality such as Brexit,championship of Portugal in Euro 2016 football game,and maybe presidency of Trump.we live in a fragile world . i think a trading strategy which losing is less than 20 % might be anti fragile .
No. Antifragile is more about Payoff than Distribution. Antifragile is being Asymmetric or Convex at best. You'll have at worst infinite but benign losses. Losses will be bounded and decreasing. Profits are unbounded and increasing. Antifragile is getting stronger, Being smart ain't necessary. It's more about sensitivity than %DD. The key words are Flexibility, Asymmetry & Convexity. I don't get it all. But that's my concepts for Risk Management Designs.
maybe we have the same concept and same idea but with different words about Taleb fragility idea. Taleb says put 95 % of your equity on zero risk investment like governmental notes and put the rest 5% on very high risk trades .so this idea is about payoff AND distribution IMO