silk, thanks. could you explain something about adding to winners... say you add, and after you add, the add turns into a loss (not the entire position, just the add). won't that just eat up profits you had from the initial buy point? so how is adding to winners any different than just another trade? i'm not saying adding to winners isn't effective, i've just always wondered about this. thanks btw, i already know when you add, you add less and less. one more thing.....whenever i think of adding to a position, something like this comes into mind. i can just picture myself starting with a small position, adding after the big move has taken place......then adding as the move is almost over....then it turns around on me when i have the largest position. also, i'd be smallest when the move was the strongest. does that happen to you? again, i'm not saying this can't work......these are just some questions i have when i think about this. .....i have another question. usually when people justify adding to winners, they say you want to add because you're getting the move you expected...so you're probably right on the direction. now, if that's true, why not do this: right now most people probably enter when they want to....why not wait instead... pick a point above and below the current price (equal distance)...THEN, enter in the direction that got hit? that way you'd be entering when you were right on direction...plus, if it went the opposite direction, then you could take the opposite trade because you now know you were wrong on direction.
That's because I come here to learn and feel I'm not qualified to teach. As you will see by the number of posts I have made I spend more time reading than posting. Catharsis is good but with 1572 posts, don't you think your overdoing it just a little?
I think you are right that when you are deciding to add to winner, you should consider it to be an individual trade (would i be wanting to buy if i didn't already have a position). The market has proven to me that stocks that are going up want to keep going up and vice versa. That is how day traders can make money off of the trends. Adding to winners gets you a big position in a stock that doesn't have a large seller in it ect. Of course you can't trade in a vacuum. you have to constantly be analyzing the futures, sectors for reversals ect.
you must be a true moron; congratulations. my discussion sparked some very good responses here. if i didn't start this thread, they wouldn't be here. it doesn't matter what i have to say, it's what can be learned from the responses.
No, I'm not a moron, and I'm not a name caller either. I concede that you can have the last word-- as that is something you have no problem in doing-- after all, it is your thread. My side of this discussion is finished.
GG, I see that your fetish with details has you looking at silk's finger and totally missing that he is pointing to the moon. silk is talking about using a tell. All great traders do this. If you are interested to learn more about that concept you can read traders as old as Livermore (Reminisces...) or as current as Doug Kass (RM). As Elvis might say: "A little bit less conversation, and a little bit more action!"
LOL That made me laugh. The "moon" is more than ¼ million miles away from the "trader". It's just another locution containing the inevitable truism that leads nowhere. Silk's finger would TELL more if it were stuck up his a$$. All great traders lol. Reading others only does any good if they inspire you towards an approach or technique of your own. Try adding to a good and certain position to watch it then destroy your up until then profitable trade. Sometimes it won't but then sometimes it will. Just like the initial trade you take and just enough in this simplistic definition to mess up averages. Every trade should be considered as carrying the same fundamental risk no matter where you start from. LOL Keep asking the questions GG it's an equally valid way to get yourself on track . No offense Babak, it just made me smile, in one of my few "off" moments.