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Ben:
When you set up your position you had a specific
negative delta position. As price goes down those deltas increase.
As long as price goes down you can maintain that delta position by taking in you
short futures. For example if you start out 500 deltas short and want to
maintain that position, when you become 600 deltas short you take in one
future. You do not have to adjust your call position. Your original
position and risk remain the same. As price rises you become longer and
when your position becomes -400 deltas and you want to maintain a -500 delta
position, then you sell enough calls to once again be 500 deltas short.
Everyone has a different strategy for the use of
options, I like the delta trading system. There is nothing wrong with the
safety net approach either.
Just one mans opinion. Good trading.
Ira.
----- Original Message -----
Sent: Tuesday, November 01, 2005 8:14
PM
Subject: [RT] Re: [e-mini_traders_anon]
Re: Taking Profit Questions
Taking profit is a matter of money mgt,
discipline, overcoming greed,
and following your written
plan,
lets take tomorrow for example,
today I shorted 4 big contracts at
1207
and bought at close 4 dec 1210
calls
if we close -10 tomorrow, will close only 1
short, and sell at loss my calls
if we continue lower, will move stop loss at 7
points above lowest low,
when we are down -15
will close 2 more shorts
the rest will most likely get stopped
out,
if
I am wrong and mkt goes up,
when it closes +10 will close all shorts, and
sell at profit 1 call
when +15 will sell 2 more calls
and +20 sell rest of calls
you must face reality
trading is a business, you must plan all your
moves ahead of the order placing
and
it better be covering all bases, what if up
what if down
if you don't do it, you are fooling no one but
yourself
and DO not blame anyone for failing, it is YOU
who is responsible for ALL of the outcome(good or bad)
best regards
Ben
----- Original Message -----
Sent: Tuesday, November 01, 2005 11:00
PM
Subject: Re: [e-mini_traders_anon] Re:
Taking Profit Questions
Sounds like a good "theory".
----- Original Message -----
Sent: Tuesday, November 01, 2005 3:32
PM
Subject: Re: [e-mini_traders_anon]
Re: Taking Profit Questions
when the time frames are not in sync usually
don't hold
when they are usually
do
----- Original Message -----
Sent: Tuesday, November 01, 2005
3:06 PM
Subject: Re: [e-mini_traders_anon]
Re: Taking Profit Questions
taking profits, and when is my current
issue, my entrys are good finally and along comes Problem
no.2, I either hold on to long and give up some nice profits and
get stopped at no loss, or I take a few pips then it shoots up and
I waste a good run.
Experience and patience is the only way to
do it, impossible to predict the future
unfortunately.
( I'm trying to hold on longer, and
it keeps biting me )
----- Original Message -----
Sent: Tuesday, November 01, 2005
7:19 PM
Subject: Re:
[e-mini_traders_anon] Re: Taking Profit Questions
Absolutely it is.... but this goes against
everything you've ever heard about profits run etc.... like markets
trend all the time or something.
----- Original Message -----
Sent: Tuesday, November 01,
2005 12:29 PM
Subject: Re:
[e-mini_traders_anon] Re: Taking Profit Questions
And I should have added that it must be
suffecient to
cause a negative expectation. It is possible to
have
larger losses and much less of them and still have
a
positive expectation.
--- Jerry <drwar2000@xxxxxxxxx>
wrote:
> You will if your profits are less than your
losses.
>
> --- e_mini_daytrader <e_mini_daytrader@xxxxxxxxx>
>
wrote:
>
> > You wont go broke taking
profits.
> >
> >
> >
> >
> > --- In e-mini_traders_anon@xxxxxxxxxxxxxxx,
>
"janice
> > wright"
> >
<wright.janice@xxxx> wrote:
> > >
> >
> spoo
> > >
> > > I have been trying to
accomplish reversal for
> > years--I learned a
>
> long time ago --if I want out I usually want
>
in--but
> > it is so hard to
> > do and change
right at that moment. Do you have
> any
> >
brain teasers
> > that help you get there--when I am a
bull I am a
> > bull for 90 min or 4
> >
hours--when I am a bear I am the same.
> > >
>
> > tkx
> > > ----- Original Message
-----
> > > From: spooboy54
> >
> To: e-mini_traders_anon@xxxxxxxxxxxxxxx
>
> > Sent: Tuesday, October 25, 2005 4:51
PM
> > > Subject: [e-mini_traders_anon] Re:
Taking
> Profit
> > Questions
> > >
> > >
> > > Brooks
>
> >
> > > I like your question, but I
don't have a ready
> > answer.
> >
> But I can say this -- I'm on it !!
Just
> today,
> > I had
> > >
an 8.00-pt S&P gain that evaporated to a mere
> >
0.50. There have
> > > been at least
two recent Thursdays that come
> to
> > mind, in
addition,
> > > where 10- to 15-point gains
evaporated in the
> > final 1/2 hour
> >
> (those were pretty unusual moves, though).
>
> >
> > > I'm with you regarding "let
your profits run",
> > and I just
> >
> don't buy into fixed targets. I must hasten
to
> > say, however,
> > > that as
a day trader, my average trade time is
> 4
> >
hours.. ergo,
> > > I'm not a scalper. For a
scalper who's in and
> > out in 5 minutes,
> >
> fixed targets may in fact be entirely
> >
reasonable.
> > >
> > > Anyway,
I'm initiating a study of MFE (max
> > favorable
excursion)
> > > versus SGB's (that's my
invention.. subsequent
> > give-backs).
> >
> My recollection is that I studied this about
8
> > years ago and
> > > found
that (at least for my type of trading)
> > there was
NO
> > > optimal ratio (ie, 40% SGB, 50%,
60%, etc),
> but
> > it's time
> >
> to try it again. I'll keep you
posted.
> > >
> > > Another
thing that may muddy the water.. my
> > system is a
>
> > reversal system .. once I get an
opening
> signal,
> > my next
> >
> signal will be to reverse. In other words,
my
> > exit signal
> > > is the
same as an entry signal for the next
> > trade.
I've
> > > had the philosophy that separate
exit and
> entry
> > signals
> >
> don't make sense... it shouldn't just be an
>
exit
> > signal
> > > unless it's
good enough to also be an entry
> > signal. Thus,
>
> > my results may/may not be applicable to
yours.
> > >
> > > As a
reversal trader, I definitely face the
> >
potential
> > > whip-saw scenario that you
alluded to. And
> dare
> > I say
> >
> it.. maybe I'll actually consider going
flat
> > between
> > > trades (I've
got a friend who is rolling in
> the
> >
aisle
> > > laughing right now because of
that one).
> > >
> > > How do
you propose to answer your own
> question?
> >
> What kind of studies might you perform?
>
> >
> > > Spoo
> > >
> > >
> > > --- In
e-mini_traders_anon@xxxxxxxxxxxxxxx,
> > "Brooks Rimes"
> > > <brooks@xxxx> wrote:
>
> > >
> > > > I've
come to the conclusion that some type
> of
> >
trailing stop is
> > > needed in
>
> > > order to capture larger profits (when
they
> are
> > available). I
> >
think
> > > any type
> >
> > of fixed profit is really scalping in
one
> form
> > or another and,
> > if
> > > used as
> > >
> the only profit taking method, goes against
> > "cut
your losses
> > short
> > > and
let
> > > > your profits run". For
those that figured
> > this out long ago,
> >
maybe
> > > you can
> >
> > help with some answers from your
experience
> > ...
> > > >
> > > > Is it best to combine fixed
profits and
> > trailing profit? Or,
> >
some
> > > other
> >
> > method?
> > > >
> > > > What works best in scaling out
profits? 2
> > steps, 3 steps? If
> >
> steps, should
> > > > it
be 50/50 or 67/33 or ?
> > > >
>
> > > What is the best type of trailing
stop?
> > > > - an N period ATR +/- the
H,L,C
> > > > - an N period SMA of the L
or H
> > > > - 1 or 2 ticks above/below
the N period
> > highest high or lowest
> >
low
> > > > or something else?
>
> > >
> > > > Is it
a good rule to always take some
> profits
> > on a
long,
> > favorable
> > >
bar?
> > > >
> >
> > To avoid being shaken out by a small
move
> > against you, is a
> > wide
> >
> stop the
> > > > best
defense?
> > > >
> >
> > If shaken out of a trade, only to watch
it
> > resume, what should
> > be
> >
> considered
> > > > in
deciding to re-enter?
> > > >
>
> > > Thanks,
> > >
>
> > > > Brooks
> >
> >
> > >
> > >
>
> >
> > >
> > >
> > >
> > >
> > >
> > >
>
>
>
--------------------------------------------------------------------
>
> ----------
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