I like your caveat "could have". LOL. Like the old saying "If ifs and buts were candy and nuts it'd be Christmas every day!"
But there are so many opportunities out there. They only look good in hindsight. You said earlier that you could have had the same returns as Ryan if you had done this or that. Do you consider that money lost? It was an opportunity that you didn't take advantage of.
This thread is basically just promoting averaging losers. If OP is generating alpha year after year this way then more power to him.
I don't use S/Ls cause da boyz go stop hunting on a regular basis. But I trade with full hedges at all times, so they don't make sense for my method. SLs don't work with options anyway. I saw a study where people who trade with manual stops do better. I think it's because trading downspikes are so common that you get stopped out and it recovers within a minute or two.
Exactly.Opportunity Cost is biting you in the ass. If you tie up 10k in a losing trade for 12 months that 10k could have been employed elsewhere making you money on some other endeavor.
Which brings up a MAJOR issue with stop losses: overnight gaps. What happened to your SL when the market opens 20% lower? And slippage? If you're trading something with big spreads, BAM! take the hit. SLs aren't magic. They have plenty of negatives.
I know that's like my major point. Nobody seems to get they only work intraday. So if I was going to do zero DTE I might use one trigger sequence of stops and kind of just rapid fire till I get in the position.. and then set a trailing stop. So stops have their place but not in regular swing trading or anything that goes beyond the intraday.... Unless we're talking crypto where the market's open 24/7 and they do actually work.
I read one too where they compared stop losses to buying puts to buying futures as a hedge and it turned out the futures was the best but I believe puts were second best and stops were the worst as a hedge
What you're saying is that you bet so little on any one of your initial entries that you can keep adding and adding to them as they go against you without running into trouble. Therefore, if an initial entry just happens to go your way from the get-go, meaning that your assessment (or luck) was spot on, your position is so small that it's almost negligible. Stated differently, your positions become their largest when you have no clue where the market is headed, but you are at your lightest when you do have a clue. Yeah, what could possibly go wrong?