OK how about a simple test? You pick the stock (free historical data available at yahoo), you pick the time period (5+ years), you pick the public domain timing strategy, you pick the initial account size, etc. The only variable will be your fixed-fraction position sizing versus my alleged optimal position sizing, and we'll see which is riskier (you pick the criterion for that as well ).
Thanks for the offer, but I principally trade NQ intraday using solely my own method, which I am not prepared to share in any detail. The relative size of my trades is a function of my familiarity with that market and my comfort level with my own approach. However, I will stipulate that you are prepared to put your sizing approach to the test and are not just passing wind. Fair enough? Have a good weekend.
Most assuredly. Sacling out appeals to traders who are overexposed with their position sizing. It is a scaredy cat strat.
Just to clarify my opinion in this thread, it applies only to mechanical traders. I would not presume to know what is best for a discretionary trader, that being a highly subjective and individualistic activity. But for mechanical trading -- trading which can be programmed into a computer --, scaling is simply a suboptimal strategy. Optimal position sizing precludes scaling in because the last thing a trader wants to do is add to a position that is already optimal size, and scaling out leads to lower profits.
Like so many of these trading conversations on ET, those Posters who have reached a critical mass of knowledge with their trading can see the point of view of those who are trailing behind them but the reverse seldom applies. As to "scaling" I do not engage in it for two reasons. 1 ... I trade ES several times each morning and things are happening very fast. 2 ... more importantly, I am not here to maximise trades, only daily profits. I regard each trade as a "stand alone" trade. Quite frankly, I am only interested in my daily ratios. regards f9
Wow, this thread is still alive? A year or so later, my opinion stands as: Sometimes I sell everything at once. Sometimes I scale out slowly, especially in a thin name. Sometimes, after exiting a partial position, I will rebuy/sell and double up on the position, depending upon how the tape subsequently acts. I hope that's concrete enough for some of you, and vague enough for others.