Moving previously fixed SL, once the trade is open, is a bit dangerous staff, better to avoid it.
Jun 19 2015 at 13:23
100 % agreed on statement. ' It's about the overall performance of a system and its settings. '
financial freedom by using own hand make EA.
OP's strategy is good if you can't watch the market all the time or have trouble controlling your emotions. Let's face it, most lose because of emotions.
I never use set SL. SL moves with the market action. Even my TP moves with the market. But I have the luxury of watching the market when I am in a position because this is what I do for living. 😁
I am not a big fan of 10 small loses and one big win. I like to win all the time with minimum DD possible. 😇
I never use set SL. SL moves with the market action. Even my TP moves with the market. But I have the luxury of watching the market when I am in a position because this is what I do for living. 😁
I am not a big fan of 10 small loses and one big win. I like to win all the time with minimum DD possible. 😇
Make Money!
avoblikov posted:
I use the most standard one: My S/L is certain percentage of my balance (I use 0,35% for one account and 1,5% for another), and I have always fixed T/P which is S/L*3. So profit/loss ratio is 3:1. NO EXCEPTIONS!!!
Anton, did you ever consider statistics? With having profit/loss ratio 3:1 you would get, in a period of time, let's say, 10 small losses and 1-3 profitable trades, only because the market will hit first the closest point to it (in our case this is SL), isn't it?
That means at the best we will have a break even (b/e) situation in money, but w/l ratio will be ~30/70%, correct?
Ironically, exactly the same is true for opposite combination 1:3 you will be break even in money, but w/l ratio will be 70/30%. 😄
So, if your point is to increase trading probability try to use opposite ratio for TP vs SL (1:3). By this way you would get lots of small winnings and only a few big losses wiping out all your profit. But w/l ratio will be very nice (~70/30%)!
So, as you can see, the Risk Management is something different and is not so simple as 3:1 or 1.5:1 ...
abradoks@
Jul 06 2015 at 20:03
Very interesting points of view and ideas from everyone.
I use a percentage of ATR to determine my SL, TSL, and TP, and combine this with TD_Line Projections. A profit projection that is better than 3:1 is traded, otherwise I stay out. Nice thing about using ATR is that it self-adjusts...bigger range in rallying markets expands SL-TSL, whilst smaller consolidation range contracts SL-TSL. Works for me!
Jan 13 2016 at 07:49
I've recently committed to adding advanced harmonic patterns to my trade plan.
With 70%+ accuracy, I only take trades with 1:1 Risk to Reward. As soon as my first target is reached I move my SL to just above break even and let my trades run to TP2 as a risk free trade.
Each trade I take is 2% risk of my account balance.
I also manage my trades based on what price action is telling me.
With 70%+ accuracy, I only take trades with 1:1 Risk to Reward. As soon as my first target is reached I move my SL to just above break even and let my trades run to TP2 as a risk free trade.
Each trade I take is 2% risk of my account balance.
I also manage my trades based on what price action is telling me.
He who risks nothing, risks everything.
Jan 14 2016 at 15:13
It is all about position sizing vs volatility per instrument.
Alex,
it all depends on where the stop loss is located. If for example the stop loss is 20 pips (sell position) and only 5 pips under a major upper resistance level, I would definitely consider moving it above the resistance level. There might be a total higher risk of the account equity by doing this, but if it's not too high of a risk taking this stand it's wise to do it, because resistance levels are watched by everyone and protected and not that easy to penetrate. If the risk on the original position is 1% and by moving the stop loss to let say 1.3% risk, I would say that it is totally OK and the right thing to do. Most of the times the resistance will prevail and in the few cases it does not, in those cases one has to take the loss.
it all depends on where the stop loss is located. If for example the stop loss is 20 pips (sell position) and only 5 pips under a major upper resistance level, I would definitely consider moving it above the resistance level. There might be a total higher risk of the account equity by doing this, but if it's not too high of a risk taking this stand it's wise to do it, because resistance levels are watched by everyone and protected and not that easy to penetrate. If the risk on the original position is 1% and by moving the stop loss to let say 1.3% risk, I would say that it is totally OK and the right thing to do. Most of the times the resistance will prevail and in the few cases it does not, in those cases one has to take the loss.
" Lock in the profit and minimize the draw down "
Jan 15 2016 at 09:29
abradoks1 posted:avoblikov posted:
I use the most standard one: My S/L is certain percentage of my balance (I use 0,35% for one account and 1,5% for another), and I have always fixed T/P which is S/L*3. So profit/loss ratio is 3:1. NO EXCEPTIONS!!!
Anton, did you ever consider statistics? With having profit/loss ratio 3:1 you would get, in a period of time, let's say, 10 small losses and 1-3 profitable trades, only because the market will hit first the closest point to it (in our case this is SL), isn't it?
That means at the best we will have a break even (b/e) situation in money, but w/l ratio will be ~30/70%, correct?
Ironically, exactly the same is true for opposite combination 1:3 you will be break even in money, but w/l ratio will be 70/30%. 😄
So, if your point is to increase trading probability try to use opposite ratio for TP vs SL (1:3). By this way you would get lots of small winnings and only a few big losses wiping out all your profit. But w/l ratio will be very nice (~70/30%)!
So, as you can see, the Risk Management is something different and is not so simple as 3:1 or 1.5:1 ...
That considering that market will give 3:1. Often it does not and there is a lot of exceptions. There is no substitute for trade management. sometimes it can be 1:1, sometimes 3:1, 1.5:1, 5:1. but having target smaller than risk relying on higher hit rate is a total BS.
I would also add that it is very difficult if not impossible to manage trade on small TF. Speed of the moves is such often there is little time to think and price action is anything but orderly.
