"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. JSSPMK

    JSSPMK

    You're holding for a home run and scale out trader keeps scaling out, how is it you're doing the same?
     
    #1661     Aug 24, 2017
  2. Buy1Sell2

    Buy1Sell2

    My strategy where I enter and exit all in all out over time will always outperform my strategy where I scale in and out.
     
    #1662     Aug 24, 2017
  3. Buy1Sell2

    Buy1Sell2

    You're trying to compare one trader to another trader. This is about comparing an individual trader to themselves. It's inferior to select scaling in/out versus all in all out.
     
    #1663     Aug 24, 2017
  4. _eug_

    _eug_

    I think the point is that its better to take off the full position at a s/r level and re-enter full if its a break out or reverse full position if the level holds.
     
    #1664     Aug 24, 2017
  5. Buy1Sell2

    Buy1Sell2

    If that is your strategy is that, then yes--all in all out is the correct move.
     
    #1665     Aug 24, 2017
  6. Newc2

    Newc2

    I'm disappointed that after 167 pages there have been no posts for nearly 1 year.

    All in all out wins? :D

    How would an emotionless robot trade?

    1. All in all out?
    2. Scale in?

    or

    3 Scale out?


    Here's a fact which I'm not sure affects anybody's thoughts but....


    "The more mature the trend the closer you are to the end of it"
     
    Last edited: Jul 7, 2018
    #1666     Jul 7, 2018
  7. tomorton

    tomorton

    Maybe an efficient use of capital would be deploy your maximum risk per trade when you confirm your high probability set-up? So if your threshold for opening a long-side trade is a 70% probability of price rising, you risk 100% of your normal risk (e.g. 2% of your account capital). If the trade goes your way and goes into profit equal to your initial risk, start reducing the position as the probability of further price rise decreases according to your TA.

    So if probability of further price rise drops to 60%, reduce your risk to 75%. At 50%, reduce to 50%. At 40%, reduce risk to 25% (substitute your own ratios).

    Even a low-probability position will sometimes make a profit when it takes the less probable route forwards.
     
    #1667     Jul 7, 2018
    Newc2 likes this.
  8. ironchef

    ironchef

    All in All out does not work in thinly traded options or thinly traded underlying: You move the market going all in and going all out.

    Or, imagine BRK buying $10B AAPL going all in and selling $10B IBM going all out?
     
    #1668     Jul 7, 2018
  9. GotherL

    GotherL

    Scaling out is just insurance for them they don't end up taking a big loss cause that usually ends up with them taking bigger losses to try to break even.
     
    Last edited: Jul 7, 2018
    #1669     Jul 7, 2018
    Buy1Sell2 likes this.
  10. Buy1Sell2

    Buy1Sell2

    Ridiculous examples and arguments
     
    #1670     Jul 13, 2018