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Just a thought.
The basic idea behind trading futures with an initial stop to me is
let your profits run and cut your losses short. You have no pre
planned exit, but a set stop level.
To me short term trading with a stop looks like having a short term
knock out option position on, where the strike and barrier are equal
to your stop level.
Since we all want to stroll around Highland Park, Dallas and we know
that 85%+- of all option buyers are losers, we must be doing
something wrong here. Let's fix it.
We want to be short these short term knock out options. First of all
we get rid of our stop. Then we establish a profit target similar to
our stop. Eventually we have cut our profits short and let our losses
run. Done.
Now we know why Mark is waxing the jet of someone else ;) And we also
know why dyslexia prevented Gentle from being unprofitable, because
he currently always has a long option position on (when trading with
a stop) and is part of a community with 85%+- losers ;)
Maybe that's also the reason why I still hang around the City of
London and not the Westend, rated the world's top affluent community
by Luxury Source in April 01. Or maybe it's because I like to walk to
work.
I love this game,
Soeren
PS: it ain't really bragging if you can walk the talk...
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