FRANZ IS BACK! <i>You must be atleast 70. Way to old for daytrading . This sounds like Franz resume'. Blind business a little slow?? LOL! Alex Wasilewski aka AlexLW our head trader in the live room and co-founder has a rich and eclectic background that might more easily have been described by what he has not done. He has never sat upon a mountain top and counseled Ringo Starr, never sacked Bart Starr, and never danced with any of the stars. He has done everything else. He has been a NYC cab driver during his college days at Manhattan College in the Bronx NY. Rudolph Giuliani graduated two years before Alex but they may have bumped into each other at the Pinewood. Alex later owned a NYC taxi medallion and relates the awe of listening to Wall Street power traders talking business in the back of the cab. A few of them took him on the floor of the NY Stock Exchange where he got his first exposure to reading the Big Tape. Among the other businesses Alex owned was a cocktail lounge on Long Island, an over the road tractor trailer freight hauling business and more recently a Budget Blinds window treatment franchise. In law enforcement and banking, Alex was a Suffolk County NY police officer, an I.R.S. auditor, and an accountant for the Federal Reserve Bank of NY. In the field of sales Alex has sold steak knives door to door, used cars, and new cars<i>
i'm speaking from the point of view of trade success percentage. if you have a trading system that has 50% success rate and you have 1 successful trade, the odds are the next will be a loser. so keeping size small will reduce net loss.
Anyone using higher than average R:R can easily add size upon every losing trade, especially the ones trading higher % systems.
Yes but there are nervous traders who are just under capitalized. There is a thread about starting to trade with $1000.. from scratch!! No way!! Maybe if you put $1000 away and used a simulator for the first 6 months.
Only if the next trade was directly related to the prior trade would the probability of loss increase following a winning trade. And even then, that average (expectation) would occur over a large number of trades and not from one trade to the next. However, if the trades are not specifically related to one another, then the odds remain at 50% for the next trade regardless of what happened to the previous one. Of course, for the purposes of this argument, I'm assuming a trader knows the probability of outcome. In fact, he doesn't.
I've back tested tons of systems. There are gains 20 times in a row then times when there are losses 5 times in a row. When im using a system I increase or decrease contract size based on the market conditions, not really what the previous trade did. It seems to work. Caj
Trading smaller after a big gain only makes sense in the context of the same market and the same timeframe.