Discussion in 'Risk Management' started by Buy1Sell2, Jul 6, 2015.
6. Avoid random entries. Learn how to enter with trends, vastly increasing your chances for success.
it's one thing to guess right on the trend, it's another thing to manage a trade where you just accidently got on the right side of a trend.
What's with the guessing and accident stuff? That's not what the OP said btw. What he said was being wrong on the entrance doesn't matter, whether it is done randomly or systematically.
This is utter nonsense of course. Entrances matter. Even if you can salvage a small loss from "guessing wrong", how can that possibly be as good as "guessing right" and riding that trade to a good profit?
Avoid random entrances. Figure it out (trading with the trend). It's well worth the effort.
It's both. You still need some sort of timing edge in buying and profit taking to go along with good money management. If you only have one, you will be 98% likely to lose.
All traders guess right. All traders guess wrong. It's what you do with those guesses that makes a winning trader or a losing trader.
So what you're saying is that exit strategy(s) matter. Duh! Everybody knows that.
My issue with you that you,re also saying entry strategy does NOT matter. I call bullshit on that.
What you're saying is that, so long as they both use good exit strategy, there's no difference between a random guesser and somebody with an 80% probability of entering trades correctly. What is this idea based on? Certainly not actual evidence.
I would bet the 80% entry guy using random exits will do at least as good as the random entry guy using great exit strategy.
would you rather give your money to a guy who claims he is a really good guesser when it comes to identifying the trend, or a guy who is very good at setting stops?
either way, they are both just guessing, except the stop setter has something very concrete to work with, like your account balance. The entry guesser has nothing but dreams and theories and past data to bet on.
a good stop setter has very good entries
for those of you playing at home that means if you enter randomly with a risk reward of 1:infinity, the only thing you have control over is the stop. So it all comes down to, "Are you a good stop setter?"
For how many ticks will he be right Forty Draws?
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