Im fairly new to trading. My last six trades have all been losers, although i didnt take any trades today. Feeling quite low at the moment. I think my system only has a 50% win rate. So i should expect six losers in a row often, maybe even 10 losers in a row according to the books i have read. What is the most losers in a row that you have had?
After 2 losses in a row I try to step back and assess what I'm doing wrong. I think a common problem I've had is I don't give my trades enough time to materialize. I trade options and I've grown to realize that this is more critical in comparison to stocks. You have to be willing to swing trade, let it dip back some before taking a loss. Don't jump out at the first sign that it's running away from you because you'll be whipsawed every time. Another thing I've realized is you really have to take your time when putting on a trade. There is nothing wrong with sitting it out, maybe even waiting a little longer. In most cases, securities only move so fast intraday, you won't miss much. If anything it will either confirm your suspicions or will give you a better buying opportunity later or the next day. I still feel there is a lot I need to learn personally, a lot more research I need to do. Maybe I need to focus more on a few select securities where I can buildup a good knowledge on how they flow. I feel like I'm more or less scrambling around from position to position and hopping into things carelessly sometimes. I need to work on taking my time and being more patient before the trade and during it. Some positions take at least a few days to see a good profit, this is how professional traders have made their fortunes in the past. They weren't intra daytrading $2k into $2million. You just won't get the stretch of growth you need that way unless you overtrade. They were swing trading it up with heavy research. Just my thoughts, I still have a lot to learn.
I had ten. When ? Spring 2007 What ? Russell 2000 futures Why ? I was shorting into a maniacal blow-off top. Lesson 1: markets move in one direction further than one can imagine.....and this is important: FOR NO REASON. Lesson 2: tight stops kept me from losing a fortune. Lesson 3: tight stops suck because you lose quite often, but see Lesson 2.
Even if your hit rate was 95%, having 2 losses in a row would happen once in a while. Me personally, I think around 9 a couple of years ago. Last year longest streak was 5. I wasn't fussed though. I know from my testing that with my 50% hit rate system, even 13 losses in a row would be quite normal over a large sample of trades.
I cannot handle a drawdown... I take only the highest of probability setups that I know... and then only if the reward /risk is good... it leads to infrequent trades and good sleep..
its still quite possible to make money with only a 50% hit rate if you know how to manage risk / reward.
i had 3 or 4 in a row row today, enough to turn a winning day into a losing day. managed to claw my way back to + a couple hundred , then my wireless connection dropped out fucking up a trade exit. ended up about -40 net today after all was said and done traded the mini russell and beans today
I agree wholly. Conversely, Its also possible to lose money with high hit rate systems. Positive expectancy is the key.