Is that 2/3 figure based on any research or is it more in the way of an observation? I'm not challenging it, just interested inthe data. I agree that seeing that range on the chart and actually booking a good part of it are two very different things.
You make an assumption AAA that significant risk at this juncture is a one way street. That's dangerous thinking my normally wise friend. Who knows!! What if Saddam facing annihilation and Bush facing political scrutinization struck some kind of landmark deal? No chance? Betcha Crude would open $3.00 lower and ES 50 higher. I remember the Tuesday after Labor Day weekend 1988, when the soybean market that had been rapidly rising on drought fears opened up limit down in futures and synthetically in options down 10%. No one saw the massive bear risk there either. I always expect the unexpected.
What constitutes a fairly wide stop? What constitutes "real" money? Cmon triple A "the only way"??? How come when people talk about the upside on these boards everybody conviently leaves out the its anti-thesis??? Sure maybe going for "large" swings will produce a higher upside but how does it effect the downside? There are two sides to the coin! Provided you don't want % of equity DD's over a certain limit, then whats the better strat -- the one yielding 12.5ES per week with max peak to trough DD's of 30pts or the one yielding 25 per week with max peak to trough DD's of 110pts? EDIT; Sorry triple A I did not read your whole statement :eek: I wrongly assumed you were implying that it can't be done. You can pretty much disregard the first two lines -- the rest applies to the entire thread. Just my 2 cents, Commisso
I was really just by eyeballing it. I suppose we could define the parameters of range, expansions days, hammers, etc, and get a statistical result.
exactly commiso-- what's more important, small consistent profitability.. or net out higher, but HUGE volatility? it is an individual's choice.
Can you explain what you mean by this - or how it is done in actual practice? It seems to me that you are never holding a winning trade or a losing trade until you close the trade out. I know that sounds like I'm splitting hairs, but I'm never sure at what point someone considers a trade a "winner" and thus applies the "let your winners run" rule. To me, it's sort of like telling someone "Here, hold this popsicle as long as you can". Pretty soon, it starts melting and dripping on the floor, and part of what used to be a popsicle is now kool-aid.
Generally, you can go long or short at any time and, at some time, you will be in-the-money. Now as for the guys who were buying up ES contracts in March and never sold -- well, they'll be waiting awhile. But generally, I notice people have too tight of stops when trading certain markets. I've even heard of people using .25 stops in the ES. Okaaaaay.
another one i like is: "don't ever let a winner turn into a loser." ok, so as soon as i have a 1 cent profit i should now place my stop at break even? yeah right...
In, too much speculating IMHO. Take 10 years worth of data. Make a trading system that trades identically on 1 minute bars and daily bars (or whatever) take note of the Maximum Adverse Excersion of each. Use those numbers to get the obvious ratios that give you a sense of Risk/Reward for each time frame. The bigger you bet, the bigger you gains/losses. The longer your time frame, the greater your gains and losess. The shorter your time frame, the greater the comissions. FWIW, IMHO, if you had a nack for telling when it was right to play the longer time frame, and when to increase your focus and drop down to the lower time frame, then I belive that you could show excess returns over doing one strategy or the other exclusively. I do not know of single computer trading program that can do this - most just trade more than one system at a time and hope that their average is better than each one individually. The real advantage is in the realm of the discretionary trader. nitro
'long, what are you trying to say, the markets ONLY went up during that period? come off it. i take it you weren't trading back then, otherwise i doubt you'd be saying what you just did. you ALWAYS had to know how to trade. the dollar volatility was just a lot bigger back then. people scalping for dimes and quarters now, were scalping for points+ back then. that's the biggest difference. your example of one trader being able to buy 200k and the other 40K doesn't really say anything at all. "the math is fairly simple"? what? i have no idea what you're trying to tell us. and i'm not sure which electronic trading books you've been reading, but i have quite a few from that era, and i can't think of one that DOESN'T discuss shorting.