|
PureBytes Links
Trading Reference Links
|
JimG and All
Well, we finally got a buy signal for tomorrow, which is in agreement with
our Intermediate Term Signal (ITS). I can't believe that our sell actually
made money after that big move up against us. <G>
Of course, we're getting a little braver and adding to the positions when
they go against us. Seems to work fairly well. Lately, we've been starting
with small positions and adding to them every 10 or 20 S&P points. The last
3 trades have been remarkable, even though they initially had major draw
downs. This last one was a little scary until the bottom dropped out. We
even made a margin call, which we never do, and then added to the short
positions. Brass cajones.
We feel that we have to have confidence in our trading system.
If we had stuck to our older visual stops, we would have taken a loss on all
3 trades instead of making money on all 3. With these major swings, the old
stop percentages we developed when the S&Ps were at 600 don't seem to apply.
We're now trading without stops and will take our chances with these draw
downs. By starting with smaller initial positions and scaling our trades,
we hope we're doing a better job of money management and minimizing our
risks while maximizing our profitability. Our initial positions are usually
15% of capital and then we scale up from there if it goes against us. We
have also reserved a majority of our capital back from the account and hold
that in Tbonds, thereby eliminating any risk of going broke. While
substantially reducing our trading positions and holding funds back, we have
actually invested up to 60% of our futures trading account. We're still
feeling our way, but since we have limited our overall risk, reduced our
initial exposure, we don't feel that we're exposing ourselves to much risk
at all. Anyway, by applying these techniques, we hope to eliminate any
possibility of going broke. We'll see how it works. So far, so good.
Regards
Guy
"If all else fails, immortality can always be assured by spectacular error."
Observation by economist John Kenneth Galbraith.
|