Says its tennis and you lay at 1.1 and it goes to 1.03 - then trade out for a loss and move on
is it that easy (with emotions in check
)Trading - so is the 'trick' to always have more upside
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marksmeets302
- Posts: 527
- Joined: Thu Dec 10, 2009 4:37 pm
It depends. If you would mentally close the position, would you re-open it again at 1.03?
Going from 1.1 to 1.03 is a relatively high loss - Without knowing your strategy it's difficult to say, but I think you should have closed it already.
Having more upside than downside is not the end-all of the game. It also depends on the chances with which that upside is reached. If you view the markets as completely random, these chances diminish the potential for profits. I mean: if you take a profit of 4 ticks, while taking a loss of 2 ticks, that would make you rich if you had a 50% chance of reaching the 4 ticks. Unfortunately, that will not be the case. Realistically, you'll reach those 4 ticks without being stopped out about 2/(4+2) = 33% of the time. This gives you a long term expected profit of 1/3 * 4 - 2/3 * 2 = 0. It therefore boils down to finding market anomalies and exploiting them.
Going from 1.1 to 1.03 is a relatively high loss - Without knowing your strategy it's difficult to say, but I think you should have closed it already.
Having more upside than downside is not the end-all of the game. It also depends on the chances with which that upside is reached. If you view the markets as completely random, these chances diminish the potential for profits. I mean: if you take a profit of 4 ticks, while taking a loss of 2 ticks, that would make you rich if you had a 50% chance of reaching the 4 ticks. Unfortunately, that will not be the case. Realistically, you'll reach those 4 ticks without being stopped out about 2/(4+2) = 33% of the time. This gives you a long term expected profit of 1/3 * 4 - 2/3 * 2 = 0. It therefore boils down to finding market anomalies and exploiting them.
7 ticks is a relatively high loss?
I'm shocked to hear that
In (say) a tennis match an 'event' will trigger much more than a 7 tick market adjustment - either a serving game is broken- or its not
In football a goal scored means 100+++ ticks are the norm
I'm shocked to hear that
In (say) a tennis match an 'event' will trigger much more than a 7 tick market adjustment - either a serving game is broken- or its not
In football a goal scored means 100+++ ticks are the norm