Hi guys, I've been mostly lurking here and am not in a position to post live yet. However I've got a couple of comments to make about Simon's (ChowClow) excellent posting of his trades which I hope might be thought provoking.
Firstly I noticed yesterday that you took a 123 EJ and 123 EU trade at the same time. It was clear from the charts that you posted that the two markets were moving pretty much in unison so effectively you've got the same trade on twice and instead of risking 0.5% you in fact have a 1% trade on. This is something which bothers me in my trading when I have the same set-up occurring across markets which are currently highly correlated. I usually just pick one market and trade that one. Another solution is to trade half sizes in each market but I would be interested to hear any other suggestions. You may of course feel that it's important to take every trade in your chosen markets come what may which I can fully understand.
Secondly, on the VEBO GU BO this morning I know that you arrived late and so missed the entry. However you elected to put a limit order in instead at the original entry price should it retrace back there (which it did). I'd just like to point out that the trouble with doing this is that the expected (i.e. average) profit for doing this is not the same as if you'd put the original order in on time. The easiest way to think about it is as follows: imagine that the outcomes from your trade stop entry are:
a) it powers off and hits your profit target
b) it goes off, comes back to your original entry point before reaching the profit target
c) it goes off, comes back and stops you out.
If you put the trade on correctly then a) and b) are winners so in our very simplistic example you've a 66% chance of winning. If however you arrive late so miss the original entry then you'll never get filled if a) occurs but you will still get a fill in scenario b) or c). This means that trading for a retracement only has a 50% chance of success. I know that this is simplistic but it does illustrate the fact that the chance of success, given that it retraces back to your original entry isn't the same as it was before you put your stop order on and it may in fact be a net loser. When you arrive late it may actually be better to give up on the trade: you won't know for sure unless you specifically test out the scenario.
Hope you don't mind these comments which are in no way intended to be criticism but instead helpful or at least thought provoking.
