New Trader trying to Stop Going In-Play

The sport of kings.
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JollyGreen
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I've seen this many times and it almost always comes down to the fear of failure. For example, you cannot accept a £10 red so you jump in play as you described. This is happening because you are not thinking long term, have probably not experienced a long term profit and are failing to cut out of a trade early enough.

My advice would be to address the last issue first; when you get it wrong, cut out of the trade quickly rather than waiting in the hope it will go your way and/or letting it turn in play when the pre-race market has not gone your way. It is NOT a sign of weakness or failure as you may feel it is. This is a part of trading and the sooner you accept the errors the sooner you will get on the path to longer term profits. Hell, I get it wrong several times a day but I just accept it and try again. You can be sitting in a great trade when suddenly a large order blows you out of the water and a profit becomes a loss. When you get to experience a longer term view you will see that you can also be sitting in a great position and a large order makes it even better. Sadly, with a short term view you rarely get the chance to experience this.

Cut your losses quicker and try to focus on a day's results then a week's results and a month's results.....

HTH

JG
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brimson25
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JG - I suffer from the not cutting losses quickly enough. Can I ask - how do you distinguish between being "shaken out" by prices which are whipping around (and will come back) and mistakes that you need to cut?

I realise this is the million dollar question and may in some ways be facile, I suspect the answer is simply experience; but do you have a rule of thumb about how much loss you're prepared to accept (in money or ticks?), and then simply cut at the point, regardless of your judgement about what it likely to happen next?

Thanks for any insight and apologies if this is a daft, unanswerable question.
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JollyGreen
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brimson25 - No such thing as a stupid question. If you don't know the answer then a question is always valid.

You are correct when you say experience counts for a lot so here goes with trying to help.

When you are joining a market, ask yourself if you are in new territory or if the market has already ventured that way. What I mean is the market has a way of finding the correct price and if you look at the amount of money traded it should give you a clue if you are in the correct place. Admittedly, if we are talking drifter or steamer then you could be on fresh ground but the amounts being traded will give you an idea of how safe it is. For example, you are looking at only £3K traded on your current price position whereas £39K has been traded 6-7 points below you and you are hoping to find a big drift. Ask yourself "what has changed in the market to make this horse trade way above what seems like the correct price?" If you cannot find a sensible reason then chances are there's been an overshoot on a move and it could crash back to the safety of £39K, a price where the market seemed to happy to trade i.e. Backers and layers agreed on the price.

Remember, as you move up in price, the layers are less likely to get involved as their liability is greater. The backers would love to get involved but there is not much money from the layers hence the price quickly moves back in. TIP: On a drifter, the layers will leave the sinking ship BUT there is a reason for this. Perhaps the horse is sweating or pulling or any other reason you can attribute to a lack of confidence. That is what I mentioned above, there is a reason for the market change, it is not a flight of fancy or an overshoot. The move is happening for a reason so you can venture into the market with more confidence.

If the price shortens there comes a point where the backers lose interest and so a reverse can come if a layer jumps in.

Stay amongst the money for now and it is less likely you will get a large unpredictable move. Yes it will still happen but less frequesnt. The amount of loss is personal but never let it get 5 ticks away from you.

HYH

JG
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brimson25
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Thanks very much for your very quick and detailed reply. I've always enjoyed your posts here.

Thanks again.
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ShaunWhite
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JollyGreen wrote:
Wed Mar 13, 2019 1:31 pm
When you are joining a market, ask yourself if you are in new territory or if the market has already ventured that way.
JG
Hi, may I ask, are you advocating being mindful of a reversion to vwap? ...unless there's a reason it shouldn't?
If so the edge must be in being astute enough to recognise those reasons in the moment, because the data in itself doesn't reveal anything conclusive for the general case, well not to me anyway. I hope I'm wrong for obvious reasons and if so I'll sharpen my pencil and keep looking.
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JollyGreen
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No, I am trying to get people to think more about where they are joining the market and what is causing the price to be at a level when there is no market activity to suggest it should be there. If a price is higher than it was, why is it high? If it isn't there for a real reason i.e. an error where it's overshot and its been chased in which case it will not be there for long and it will revert as this is not a real reason for the position, it is an error and a temporary position. If however, there is an issue with the horse or if another horse is being strongly supported then that legitimate reason (plenty more you can list) makes it a safer proposition. A price is not going to stay in no mans land without good reason, so unless money suddenly floods in to keep it there it will move. If it is 7 points above your "vwap" then there has to be a reason for that and something has to change to substantiate that position.

EDIT: SOrry for the typos, I am trying to do multiple things and I am not doing well. There bets at Cheltenham all placed this morning, THREE BLOODY SECONDS!!!
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JollyGreen
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ShaunWhite wrote:
Wed Mar 13, 2019 2:40 pm
JollyGreen wrote:
Wed Mar 13, 2019 1:31 pm
When you are joining a market, ask yourself if you are in new territory or if the market has already ventured that way.
JG
Hi, may I ask, are you advocating being mindful of a reversion to vwap? ...unless there's a reason it shouldn't?
If so the edge must be in being astute enough to recognise those reasons in the moment, because the data in itself doesn't reveal anything conclusive for the general case, well not to me anyway. I hope I'm wrong for obvious reasons and if so I'll sharpen my pencil and keep looking.
Another reply on this subject. You are correct in that there is a fair bit of intuitive behaviour but you need to be aware of why a move is happening. As I said, experience plays a part and I cannot give that to new or novice traders. A lot lose money because their entry point is wrong for most of their activity. They see a move and jump on it without asking why it moved. If they waited and checked why it moved they may prevent themselves from creating an instant loss and then chasing their tails. They may actually spot the true reason (or the wrong reason) and then take advantage of it. They may catch the ongoing drift/steam based on a proper move or they may catch a reversion due to a false move.
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ShaunWhite
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Thanks. I think we agree, context is king. As you say too many people forget the numbers are a window on the world and not just a video game that exists in its own bubble. Every move needs to be accompanied by 'why?'.

I'd taken a hiatus from the forum, but some people are worth quizzing when they show up;)
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JollyGreen
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ShaunWhite wrote:
Wed Mar 13, 2019 3:48 pm
Thanks. I think we agree, context is king. As you say too many people forget the numbers are a window on the world and not just a video game that exists in its own bubble. Every move needs to be accompanied by 'why?'.

I'd taken a hiatus from the forum, but some people are worth quizzing when they show up;)
We do agree and as you say, context is king!

In these markets there is no free money so if a move occurs and someone made an error it will be swallowed up very quickly. If you are basing your opening order on said error then you will get swallowed up too. Even if you just suspect there is an error and wait momentarily while you decide, you will save yourself money and gain some valuable experience.
iambic_pentameter
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Great to see you back posting, JG.

Hope you are well and enjoying Cheltenham.

Iambic.
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JollyGreen
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iambic_pentameter wrote:
Wed Mar 13, 2019 5:12 pm
Great to see you back posting, JG.

Hope you are well and enjoying Cheltenham.

Iambic.
I had bets on the first three races at Cheltenham and they all came second!! Wicklow Brave was caught in the shadow of the post at 33/1 (28/1 SP) :?

I didn't bet in the Champion Chase or the Cross Country but I had Cocoa Beach in the Fred Winter and there are no prizes for guessing where that finished :roll:
iambic_pentameter
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JollyGreen wrote:
Wed Mar 13, 2019 5:26 pm
iambic_pentameter wrote:
Wed Mar 13, 2019 5:12 pm
Great to see you back posting, JG.

Hope you are well and enjoying Cheltenham.

Iambic.
I had bets on the first three races at Cheltenham and they all came second!! Wicklow Brave was caught in the shadow of the post at 33/1 (28/1 SP) :?

I didn't bet in the Champion Chase or the Cross Country but I had Cocoa Beach in the Fred Winter and there are no prizes for guessing where that finished :roll:
A friend of mine was on Wickow Brave as well so I can understand how you feel there!
luckytrader
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stockdale51 wrote:
Mon Mar 04, 2019 10:14 am
hi i got shot down in flames by some poster that said i can not possibly make 10.00 per trade with stakes of 10.00 pound . but i agree with you i have started useing a bank of 150,00 and i have doubled it within a week. so 100 % profit on my out lay is pretty good imo . but your right even if your liability is your whole bank 30 seconds before the off you still get out . i have set myself between 5.00 and 10.00 loss then i get out regardless of my gut feeling that when race starts inplay it will hit my close trade if its just a few ticks. and am back in green . you learn by your mistakes but it is possible to make 10.00 per race with 10.00 stakes but is there any rule to say thats bad trading useing your whole bank ?
hi
I have been trading for just over a year now and have to confess I have tried the in play after a trade has gone wrong in the early days several times and i think i got away with it maybe twice out of 6 or 7 times the last one cost me over half the bank.

I now can make around 15 pounds per day from a 300.00 bank so not planning retiring just yet. I would say lower your stakes setup a simple excel sheet so you can see your strike rate and average win and loss. If your average win is for example £4.00 then obviously if you are letting your losses go to £20.00 plus that's a lot of trading to get back on an even keel not to mention the anxiety. Cut it out at least £8.00 except the small loss and move on in trading remember you will LOSE some.

I'll bet (No pun intended) if you look at some daily records from an excel sheet as described above you will wonder what the hell was I doing with that kind of money its not till its in black and white in front of you do you realise I'm a trading god or not as good as I thought.

Good Luck
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brimson25
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ShaunWhite wrote:
Wed Mar 13, 2019 3:48 pm
Thanks. I think we agree, context is king. As you say too many people forget the numbers are a window on the world and not just a video game that exists in its own bubble. Every move needs to be accompanied by 'why?'.

I'd taken a hiatus from the forum, but some people are worth quizzing when they show up;)
I have a new post-it on my desk, saying: "WHY is this happening?"
stueytrader
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JollyGreen wrote:
Wed Mar 13, 2019 3:31 pm

Another reply on this subject. You are correct in that there is a fair bit of intuitive behaviour but you need to be aware of why a move is happening. As I said, experience plays a part and I cannot give that to new or novice traders. A lot lose money because their entry point is wrong for most of their activity. They see a move and jump on it without asking why it moved. If they waited and checked why it moved they may prevent themselves from creating an instant loss and then chasing their tails. They may actually spot the true reason (or the wrong reason) and then take advantage of it. They may catch the ongoing drift/steam based on a proper move or they may catch a reversion due to a false move.
Interesting post, which I really wanted to reply to, due to an earlier discussion I had on here.

I remember a similar discussion about the 'why' in market moves, many posters suggested that market moves were often impossible to know a 'why' behind market moves - are we now suggesting that is wrong?

Personally, I agree with the principle that all traders should have an underlying view for why a market drifts or shortens a selection, but I guess we may be discussing fundamentals vs technical analysis here - do we mean a 'fundamental' why or a technical (it's all in the stats) why?
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