"Losers average losers"?

Discussion in 'Trading' started by a529612, Oct 9, 2006.

  1. Do you agree with Paul Tudor Jones?

    <img src="http://www.turtletrader.com/images/paul-tudor-jones.jpg">

    The photo in the background of Paul Tudor Jones’ office says it all: Losers average losers. Jones’ wisdom was obviously lost on James K. Glassman judging from the following excerpt from his Washington Post investing column:

    If you had Enron in your portfolio and didn't sell it at $90 or even at $10, don't feel embarrassed. As Alfred Harrison, a money manager at Alliance Capital Management Holding LP, which owned a ton of Enron, put it, 'On the surface it had always seemed to be a fairly good growth stock. We bought it all the way down.'

    Glassman and Harrison are both dead wrong. You must feel less cash in your pocket if you average losers, not just embarrassed. Harrison violates a cardinal rule of Trend Following trading. Even worse, as an active money manager for clients, he admits to averaging losers as a strategy. If the trend is down, it's not a buying opportunity. It's a selling opportunity or a time to go short opportunity.

    The absolute wisdom is on a simple piece of paper hanging right behind Paul Tudor Jones' head: "Losers average losers". Think about it.
  2. I would disagree that any new entry has anything to do with an old entry. If you have a good signal after your prior signal lead to a trade that has gone against you, you don't skip it just because of your previous signal. Trade your strategy how it was tested.

    If you haven't tested your strategy, you shouldn't make any trades at all.

  3. ntk


    If memory serves me, you have just more or less quoted Covel's Trend Following without attribution. What are you getting at?
  4. Buy1Sell2


  5. Buy1Sell2


  6. fletch2


    Bingo. Whether or not "now" is a good entry is mostly independent of whether or not sometime before was a good entry. There certainly can be two good long entries, with the second at a lower price than the first, or the other way around. Of course, if your sole purpose for the second entry is to "average a loser", well, that's not much of a strategy for an entry.

  7. A losing trade is a losing trade. Exit out, take your lumps, find a new stock and live to trade again.

    Many people use walls of shame so they dont forget the mistakes they made in the past. If you see a sign like this posted up by a computer then you know that that person has learned a strong lesson.

    The vast majority of people who play with stocks are male. They dont want to admit to themselves that they were wrong and so they instead "average down".
  8. bighog

    bighog Guest

    Agreed, once you are filled, all new signals in same direction are voided unless you are adding on (which puts more risk in).

    EXAMPLE: You are long in what you see as leg 1 of a possible 3 legs move. Mkt retraces but stays above 50% of previous leg and forms a BULL FLAG, also you know the odds say think continuation UNTIL you see a reversal setup forming. OK, you get the HOOK as price tops the top of the flag pole to TELL you another leg is what they are thinking, OK?

    THAT actually is ANOTHER BUY SIGNAL. Again UNLESS you are going to add-on, the NEW BUY SIGNAL is voided.

    Good trading to all, think like THEY do.............. :cool:

    eagle488...........HA, so men should not be sore losers as they usually are when the sweetie packs her freight and all of a sudden the man is in love with her? Do men have certain behavior patterns when their ego is tripped? :D
  9. At a young age, women seem to be the centerpoint of a man's life. Things do change with age and they can change for the better or worse. The statistics demonstrate that things will most probably change for the worse. The worse is divorce court and a life of being a emotional&financial wreck.

    People talk about losing tades where they lost tens of thousands of dollars. Well, thats just a one time loss that involves taking your lumps immediately and then working later on to make it up. On the other hand, a divorce is by far a much greater loss stretched over a long period of time.

    All I can say is that its good to be single. There will always be more women along the line. Even if you feel that you cant get women, then I point you to some foreign country like Brazil or Thailand. Go pay some chick and get your rocks off.

    Prostitution seems immoral until you realize that you are going to pay in the end whether its for free or pay. Women are a losing financial proposition in any event.

    If the sweetie packs it up tommorrow, dont fret. There is always myspace and like I said, Thailand or Brazil...
  10. bighog

    bighog Guest

    Sidenote. Ok, but there is a whole lot more about women than just a romp in the sack. Some men (most have a hard time after a breakup. Many never recover. But indeed, many men/women do just fine after a breakup. Depends on your makeup. LOL

    PS........think of sex as a candy treat for being a nice lad. The candy is nothing compared to the real meal dished from a fine classy, intelligent women. ...
    #10     Oct 10, 2006