I am an ES and ER trader. I would like to get some input on other traders risk tolerance. My risk : 1% max.of account balance on any trade 10 trade per week max. Tend to close out trades early to maintain a high win % Sometimes exit is right at end of move and other times a lot is left on the table. I guess that's par for the course to maintain a high win %, but looking at past trades I would be better off settling for a lower win % and letting some of the winners run more. After a few losers I tend to reduce size which ends up slowing things down ,but takes much longer to get back to the equity high. Interested in others thoughts.
When you are in a winning trade, why not scale out and move your protective stop to break-even on the remainder of your position? In this way, you will continue to enjoy a similarly high win rate, and you will be able to participate in extended moves. You may not be maximizing the potential of the trade, but there is something to be said for a smooth equity curve and a method that does not depend on extended moves in order to be profitable.
Depending on your commission rates, some like to simply make $20+/trade and crank out 1000s of trades a month, getting in/out certainly runs commissions higher but you also dont get greedy and pocketing the small increments all day long pays the bills.
For my main Volatility Breakout strategy I trade using a progression on loss. It starts at .9% after a win and can grow to as much as 3% per-trade after a series of losses. The only way I can lose money with this strategy is if volatility declines and stays low. I have a stop trading circuit breaker in place in case the ES drops below a 7 pt daily range. My last losing month was May 2004 and yes I've had as many as 12 losses in a row. Just part of the game. 43yotrader
Thanks for the responses everyone. In the end I decided to keep the same strategy (same entrys and exits) but increase the position size.