Shakone
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jeffre, you started a thread about why people use stop loss. You received some answers. Don't see a problem really. You don't agree which is fine, trade how you like. But no point starting this thread unless you wanted other opinions.
Ok, so to the maths of your trade. You entered at 5350. You then entered another 4 positions up to 5800 or so, and this represents a loss of 8%. Just for example, lets say you have an average price of 5600, an account of 10,000. You then have a £4 per point bet short on the FTSE average price 5600, that's 8% down or so. That means initially you were aiming with a £1 per point bet, for 90 points or 0.9%. You've waited for over 4 months, and are at -8%.
Now, does it seem likely to you, that someone who is willing to wait 4 months to make 0.9% on the first trade, and is 8% down for that 4 months, is likely to make 100% in the year? Maybe you will, maybe you have, but on the info you've given, it doesn't look likely. I understand that you might not take 0.9% on every trade, but you did mention you would reduce your position from 4 to 4 a lot earlier than 5260.
You keep saying you believe it is a valid target. Well so what? Didn't you believe that when you entered at 5350, it would go down? And weren't you wrong about that?
So you've received plenty of responses about why you should use stop losses. Please give some good reasons why you shouldn't.
Ok, so to the maths of your trade. You entered at 5350. You then entered another 4 positions up to 5800 or so, and this represents a loss of 8%. Just for example, lets say you have an average price of 5600, an account of 10,000. You then have a £4 per point bet short on the FTSE average price 5600, that's 8% down or so. That means initially you were aiming with a £1 per point bet, for 90 points or 0.9%. You've waited for over 4 months, and are at -8%.
Now, does it seem likely to you, that someone who is willing to wait 4 months to make 0.9% on the first trade, and is 8% down for that 4 months, is likely to make 100% in the year? Maybe you will, maybe you have, but on the info you've given, it doesn't look likely. I understand that you might not take 0.9% on every trade, but you did mention you would reduce your position from 4 to 4 a lot earlier than 5260.
You keep saying you believe it is a valid target. Well so what? Didn't you believe that when you entered at 5350, it would go down? And weren't you wrong about that?
So you've received plenty of responses about why you should use stop losses. Please give some good reasons why you shouldn't.