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BGiroux writes:
> Tom Strickland wrote:
> >
> > Bruce,
> >
> > Here's a suggestion for your consideration. I've just started using it so I
> > don't have a sufficient track record yet, but I feel better (i.e., less
> > indecisive) about my trading.
> >
> > I have my program generate stop values at the end of the day and set them
> > at night for the next trading day. This way, the actual trades are
> > automatic - the market actually decides for me.
> >
> > Hope you find this to be of some value.
> >
> > Tom Strickland
>
> I agree stops help a great deal, The system I employ now defines the
> stops for me. The mechanical stops eliminate the 'noise' of any
> descision I am required to make regarding the exit. Prior to my use of
> the stops, I had a trouble getting out of trades with any consistent
> (profitable) results.
I was a former user of SuperCharts, and thus still receive all of Omega's
adverts, mags, etc. In the latest Omega mag, they have a pretty good article
on *PROFIT* stops (in addition to stop-loss).
Does anyone use these? The article tests several different methods, but the
gist of it was you may not make much more mony (if any), but your drawdown
risk is significantly lower. Many people attempt to let their profits run,
and end up making less money (with bigger drawdowns) as a result.
The method they hinged on was getting out at your entry price plus a multiple
of the standard deviation of the price. The multiples went from 4 to 10, with
8 being the best profit/drawdown ratio. They used a mixture of various
futures contracts.
--
========================================================================
First they came for the fourth amendment, but I said nothing because I
wasn't a drug dealer. Then they came for the sixth amendment, but I
kept quiet because I wasn't guilty. Finally they came for the first
amendment, and by then it was too late to say anything at all.
http://www.unixgeek.com/cgi-bin/motd.pl - PGP email preferred
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