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RTs,
I have a little problem I would like some advice on.
I have recently been paper trading the S&P and doing fairly well. Not
great, but showing profits. BTW, I have paper traded in the past and
lost money. I am not the kind of person who paper trades and always
makes money. I am very disiplined when I paper trade, I give myself the
worst possible fill I could imagine, and I don't cut myself any breaks.
Anyway, I am buying 2 S&P contracts with a 10 grand account. (Actually,
I was told I could do this if I day trade only, but I haven't actually
done it yet, so I might not be able to buy 2 contracts with 10 grand).
The common wisdom is that your stops should be 2 percent of your
account. But that makes my stops too tight. Actually, I have been using
about a 1 point stop or 500 dollars with 2 contracts. Now that makes my
stops about 5 percent instead of 2 percent. Now I am still making money,
but I am going against conventional wisdom of a 2 pecent stop.
The alternative would be to trade the DJ futures. That would make my
stops more reasonable in relation to my account size, since the contract
is smaller. But, I don't currently get the CBOT, so that would mean
another 60 bucks per month, or I would have to cancel my CME, which I
really don't want to do right now, because eventually I do want to trade
the big contract. Also I am worried about exectution speeds being slower
for the DJ than the S&P. BUT, I would be following all the rules for 2
pecent stops.
Any advice would be appreciated.
Troy
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