Increasing Size During Drawdown

Discussion in 'Risk Management' started by oldtime, Oct 1, 2011.

  1. How do you guy decide a system in a equity downdraw no more producing result and should be discard? Any methods?
     
    #51     Oct 31, 2011
  2. kricka

    kricka

    I guess we all have tested increasing during draw down. I don't think it's a good idea. A prolonged streak of losses might totally wipe the account out if we do. Proper risk and money management instead, increasing size should not be an option, why take the chance? Best practice, minimize the losses during draw downs and be patient for the turnaround in your favor.
     
    #52     Dec 5, 2011
  3. Horrible idea.

    Look up "gambler's fallacy".

    It may clear up confusion about strategies that don't have an edge, but want to attempt this.
     
    #53     Dec 5, 2011
  4. I started this thread a long time ago when I was going through just an uncanny long string of consistent losses. I stayed with it because I had made very good money using it in the past. Sure enough, things turned, my only regret is that I did not increase size at the bottom.
     
    #54     Dec 5, 2011
  5. I knew I was at the bottom because if I wasn't I had somehow invented the worst system of all time. And I gurandamnteeya if I'd had that many winners in a row I would have reduced size or just quit for a while.
     
    #55     Dec 5, 2011
  6. pbylina

    pbylina

    Bad idea to decrease size after draw down. It will be harder to get it back.
     
    #56     Dec 8, 2011
    Johno1 likes this.
  7. you got it backwards, not decrease, but increase. Anyway, to put an end to this, the correct answer is, it depends on the system.
     
    #57     Dec 8, 2011
  8. pbylina

    pbylina

    Good answer good answer.:D
     
    #58     Dec 8, 2011
  9. traderrn

    traderrn

    Increase size during drawn down? Why? You want to accelerate the implosion?
     
    #59     Dec 16, 2011
  10. I'm not suggesting I have any numbers to back this up but this strikes me as a VERY FREAKIN' BAD IDEA!!
     
    #60     Dec 16, 2011