How certain are you of the trades you place?

Discussion in 'Trading' started by rin4et, Jan 23, 2018.

  1. rin4et


    I said 3% of their position size which is $3000. Their account could be $30k or $40k but the scenario above still applies.
    #21     Jan 24, 2018
  2. Hooter


    I will take a low probability trade if my risk is small and expected pay out is large enough. Conversely, i will pass on low risk but low pay off trades. I take up to 10 trades a day but the best days are one and done! I often scale into winners and scale out of losers, so my may position size can be quite high if im deep in the money but i almost never start full size. This makes a lot of people mad but i am a PnL day trader and i stop trading when i hit profit goal or loss limit, regardless of the market. You have to have a finish line
    #22     Jan 27, 2018
    spy guy and JamesEM like this.
  3. JamesEM


    My sentiments exactly.
    #23     Jan 27, 2018
  4. JamesEM


    There is an inherent problem in this oft-used analogy which seems to be overlooked.

    The cheetah doesn't get to see, with absolutely no uncertainty, which of the "kills" would have resulted in success anyway, even if it was deemed less than high probability.

    The trading landscape is mentally brutal- you get to be "right" (but "wrong"...i.e. stopped before the move and/or nearly at target then price reverses, stopping you out), "wrong" (but "right"...i.e. making money despite making a mistake according to your plan) and everything in between.

    First, you have to understand the nature of probabilities...then you have to accept it (not just act on it...big difference between the two!). Seeing what would have been means you need even more mental capital in order to get to, and act on, that "high probability kill" without letting the journey throw you off.
    Last edited: Jan 27, 2018
    #24     Jan 27, 2018
  5. bpr


    u have been telling the same thing again again in various posts ....
    but you never talk about risk reward ratio...
    a low probability trade always has to have high reward to risk ratio...
    Similarly a high probability trade generally comes with low reward to risk ratio.

    if you have both winning percentage and risk reward ratio then we can compare 2 methods else we cannot compare ...

    theses are 2 styles people can choose whatever suits their psychology.
    #25     Jan 27, 2018
    Hooter likes this.
  6. ironchef


    Actually according to the PBS program Nature, cheetahs only caught one out of ~5-10 preys they chased, not exactly the win rate you day traders are looking for.
    #26     Jan 27, 2018
  7. Overnight


    You guys aren't doing it right without mentioning Mr. Cheetah himself, Sir Attenborough. In fact, what rin4et posted above with the cheetah hiding in the bush etc, I read in David's voice in my mind's ear.

    Last edited: Jan 27, 2018
    #27     Jan 27, 2018
    JamesEM likes this.
  8. JamesEM


    Where is the "tumbleweed" emoticon...? lol.
    #28     Jan 27, 2018
  9. spy guy

    spy guy

    I concur dont feel like you have to be in the market everyday, wait until it looks right for you, I am out of the market more than I am in it and it works for me
    #29     Jan 27, 2018
  10. mbondy


    My certainty on any given trade is usually dictated to me by the market shortly after entering, for better or worse.
    #30     Jan 29, 2018