why scale out

Discussion in 'Risk Management' started by investwthme, Dec 5, 2008.

  1. The long thread linked above basically came down to the fact that in order to say scaling out is always inferior behaviour, you have to have a crystal ball which tells you what's going to happen in the future. The OP Buy1Sell2 said that it is possible to know the optimal exit point for any trade (check the thread). Of course, this is ridiculous. It was instructive to see how the poll in that thread went, though.

    On scaling in, my intraday trading has changed significantly since I started putting on half a position on first entry. If the trade goes against me by a few ticks, the remaining half goes on at a predetermined point, at which time the entire position represents my standard R/R setup with 'normal' stops. I'm not primarily an intraday trader so perhaps experienced guys have gone through this phase only to realize that it's better to hone entries than to make sure you're not always getting stopped out only to see the trade rocket off in your direction. At any rate, it's a learning process, but this is working much better for me.
     
    #41     Jan 8, 2009
  2. If I had closed my entire position (3 contracts) for .50 then I would have really felt like a jackass. I look for 2+ points for every trade. I was scaling out for the first time and I wanted to see how it felt psychologically. It sucked. every time I try to scale out I end up making less money. Happened to me today too.
    Scaling in actually helped well no it was more like averaging down. I know most people say not to average down but on a choppy day like today where we were just trading bet. 896 and 904 all day worked out pretty well
     
    #42     Jan 9, 2009
  3. " If it's crap - reverse." with what size? With Small size?

    That's scaling in! :D


     
    #43     Jun 4, 2009
  4. bennie83

    bennie83

    good thread
     
    #44     Jun 7, 2009
  5. whatever works
     
    #45     Jun 8, 2009
  6. xxxskier

    xxxskier Guest

    i usually go all in and always scale out, unless its a loser then i get all out.

    scaling works for some and nbot for others. depends on your trading style. for instance i trade ES and try to capture the major intraday trend by getting good trade location early on and then milking it for as long as i can.

    i happen to have three different trading days when i sav saved the IB trade log. i'll post all three.

    first one is here. i went all in ( i think i may have added a bit along the way after some scaling) and rode the this one trade all day.
     
    #46     Jun 9, 2009
  7. MarkBrown

    MarkBrown

    GOLDEN! How True!
     
    #47     Jun 9, 2009
  8. xxxskier

    xxxskier Guest

    rode this one trade all day as well.
     
    #48     Jun 9, 2009
  9. xxxskier

    xxxskier Guest

    another single trade all day with scaling out.....

    scaling out is the only way i can trade ES and make decent money.
     
    #49     Jun 9, 2009
  10. MarkBrown

    MarkBrown

    one event wonder - in concrete the replication is not hardened.
     
    #50     Jun 9, 2009