"Scaling out" is inferior behavior

Discussion in 'Strategy Building' started by Buy1Sell2, Oct 18, 2006.

Do you scale out of positions?

  1. I always scale out

    113 vote(s)
    14.1%
  2. I scale out most of the time

    228 vote(s)
    28.5%
  3. Most of the time, I do not scale out

    189 vote(s)
    23.6%
  4. I never scale out

    270 vote(s)
    33.8%
  1. Buy1Sell2

    Buy1Sell2

    And on the pairs that begin moving in the right direction immediately, then you don't have full position on for the full move. No--it's best over the long haul just to get in with full position on every time. :)
     
    #1381     Aug 2, 2011
  2. Buy1Sell2

    Buy1Sell2

    This unfortunately chokes off profits on the big winners. :)
     
    #1382     Aug 2, 2011
  3. ammo

    ammo

    you could get all out at the top and have it not be the top((??,better??) to leave money on the table by taking off a partial at or near your target and leave a runner ,than to wait for an all out and have it reverse before target and you gave money back, i emphasized better because it's 6of 1,1/2 dozen of the other ,you never know,you went all in at 1314 and it ran to 1347,had you partialed in your average would have been much higher than 1314,had it not run up and 1314 was the top ,your concrete beleif would have merit,it's obviously,exampled by your own trading,not a rule that should be carved in stone
     
    #1383     Aug 2, 2011
  4. Buy1Sell2

    Buy1Sell2

    Reminder: the all in all out strategy is superior over the long haul. Sometimes a trade will catch a lot of points and sometimes not, but over the long haul, all in all out will reap the best benefit or lose the least. :)
     
    #1384     Aug 2, 2011
  5. ammo

    ammo

    agree to disagree,we all have our beliefs,very few are carved in stone
     
    #1385     Aug 2, 2011
  6. Buy1Sell2

    Buy1Sell2

    This one is carved in stone. I've proven the point many times here. It just doesn't compute sense to leave runners etc. If it makes sense to remove part of the position, it makes sense to remove it all.:)
     
    #1386     Aug 2, 2011
  7. ammo

    ammo

    ...you sold 1314 on jun 30, ,..unless you know where the exact top and bottom is,avg is better,had you said all in and all out on major trendlines,then i would agree about the chisel and the stone,proof is right in front of your eyes, you went it at the 50% fib line,if it didnt hold you scratch,small loss or add,the all in trade rule on majors only,would have worked this time,and the partial on other supp/res would be more prudent we don't often hit majors so shorting early gives more trades/profit when right... this chart is not an anomaly,it happens all the time ............................................................http://www.elitetrader.com/vb/showthread.php?s=&postid=3224129#post3224129
     
    #1387     Aug 2, 2011
  8. Buy1Sell2

    Buy1Sell2

    --on this one trade--- not over the long haul.
     
    #1388     Aug 2, 2011
  9. Buy1Sell2

    Buy1Sell2

    you see--there will be numerous times when I do catch the top and I will have full position on for the big win. With averaging, I will not have full on. The math here is easy.:)
     
    #1389     Aug 2, 2011
  10. Lol let this topic die already. Your one purpose on this site is to prove this point?

    To scale out or not to scale out has probably a .01% chance of making a difference, in terms of edge, between success and failure over the long run. In terms of "maximizing" profits, I'm sure it most likely evens out as well.

    But besides the obvious rebuttals, think of it this way: Which method will actually help you develop as a trader?

    On one hand, trader A says "I'm getting out here completely; this is enough profit for me, I don't care how much further it goes, I'm happy with what I know and don't care to dwell on things further."

    While trader B might say "I'm not exactly sure, this trade may have further to go but this is usually where I take my profits. But let's see if I can develop my ability to hold winners longer and learn to sit -- I'll take half my position here and see how the rest works."

    There is so much more to handling a position besides either A or B and naught else. Have you ever taken a position, doubled up as it went your way, scaled out some as it continued -- then seeing how the market reacted to your partial sales, redoubled and/or even tripled back the position?

    Black and white? Or shades of gray? Imo, simple is as simple does. Sorry for the rant but just can't stand stubborn pontification -- it's so antithetical to the way a successful trader thinks and develops.
     
    #1390     Aug 2, 2011