Why have 20+ small trades open on same FX?

[newspreadbetter]

Been hunting around and following a few traders/fx traders just to see what people do and why, and a couple of blogs/journals in FX have 20 or more small trades open on the same pair, same direction etc all started within a few minutes of one another?

Is this any different from 1 larger trade? Is there any logic to this? Inquisitive really...

 

[itspossible]

Been hunting around and following a few traders/fx traders just to see what people do and why, and a couple of blogs/journals in FX have 20 or more small trades open on the same pair, same direction etc all started within a few minutes of one another?

Is this any different from 1 larger trade? Is there any logic to this? Inquisitive really...

It may be lies.Believe very little my friend.
I can see the logic of having different limit orders with various brokers though.

 

[newspreadbetter]

It may be lies.Believe very little my friend.
I can see the logic of having different limit orders with various brokers though.

Ah thanks itspossible, I have read about using 2 or 3 brokers/SB companies in case one crashes or to get better price etc, just wondered if there was any other reason behind it?

 

[tomorton]

People like to be busy and active. For some people, opening a trade is like a compulsive shopping purchase in the sales. They not only feel good getting a bargain, they get the reward of having another trade to manage. The mechanics of trading are driving their activity when it should be profits that lead.

 

[zaysev36]

on the same pair, same direction etc

If you hadn't mention this, I'd have suggested they do this for risk diversification, but with that said - I can't figure out any practical reason for such behaviour. I'm getting curious too, so if you find out - please let us know

 

[mlawson71]

I've actually seen strategies that have traders do such a thing. Another reason is that people are insecure/uncertain about their decision and the more the market moves in a certain direction the more positions they open. Of course, that's the case when we're talking about an individual currency pairs. Why people open multiple positions on multiple instruments is beyond me, to be honest. It must be quite hard following them all.

 

[zaysev36]

I've actually seen strategies that have traders do such a thing. Another reason is that people are insecure/uncertain about their decision and the more the market moves in a certain direction the more positions they open. Of course, that's the case when we're talking about an individual currency pairs. Why people open multiple positions on multiple instruments is beyond me, to be honest. It must be quite hard following them all.

Hard indeed, but if you actually manage to do so it should ensure you're maximising profit whili minimizing risks. Which is the most basic advice everyone seem to give to newcomers, isn't it?

 

[f2calv]

If the trader is using profit.ly or some other online journal thing then their stats for winning trades/points could be falsely enhanced?
If the trader is opening the positions via a social/mirror trading service maybe they get more kickbacks on number of trades opened by their followers?
Maybe the trader is using a broker where it isn't possible to partially close larger positions and they may wish to scale out later?

 

[Lord Flasheart]

Been hunting around and following a few traders/fx traders just to see what people do and why, and a couple of blogs/journals in FX have 20 or more small trades open on the same pair, same direction etc all started within a few minutes of one another?

Is this any different from 1 larger trade? Is there any logic to this? Inquisitive really...

this is how i trade. I take several positions on the same pair at roughly the same entry point and take them off as the trade develops. It takes the pressure of exit points. If I take 5 positions with a stop of 30, take one of at +20,one at say +50,one at 70,one at 100 and one at 200. Good risk reward and as I said im never angry that I got out too early.

 

[zaysev36]

this is how i trade. I take several positions on the same pair at roughly the same entry point and take them off as the trade develops. It takes the pressure of exit points. If I take 5 positions with a stop of 30, take one of at +20,one at say +50,one at 70,one at 100 and one at 200. Good risk reward and as I said im never angry that I got out too early.

I don't get it. What's the point, why won't you just set them all to 30 or to 200? How exactly does it take away the pressure?

 

[Lord Flasheart]

I don't get it. What's the point, why won't you just set them all to 30 or to 200? How exactly does it take away the pressure?

Once we are in a trade emotion takes over and the rule book is thrown away. How often have you managed to keep to your exact exit plan,or the trade not quite reached there,etc. By doing this and taking some off at various stages,the trade can left for a big run, even if it is only 1 position. If you use a stop of say 30 and get one to 200,thats 6 new 30 point trades
I rarely get those horrible feelings of why did I get out there and left another 50.100 pips on the table. We all have our own styles I guess

 

[dbphoenix]

Search for "pyramiding" as well as scaling in and scaling out.

Db

 

[Lord Flasheart]

Search for "pyramiding" as well as scaling in and scaling out.

Db

Pyramiding is a sure way to blow an account,too much pressure to keep adding in

scaling out,oh yes

 

[dbphoenix]

Pyramiding is a sure way to blow an account,too much pressure to keep adding in

scaling out,oh yes

There's no pressure if it's planned carefully ahead of time and one understands what a retracement is. Otherwise, yes, it's an inappropriate tactic. Instituting a large position at the outset and scaling out carries its own pressures.

Db

 

[Lord Flasheart]

There's no pressure if it's planned carefully ahead of time and one understands what a retracement is. Otherwise, yes, it's an inappropriate tactic. Instituting a large position at the outset and scaling out carries its own pressures.

Db

sure it can do,depends on how you approach it,it provides me comfort and reduces my stress levels. I know sooner or later I will have a big run.
Not many books would write positively about either method. but then again if the books were right,95% of traders would make money. I wonder:whistling

 

[dbphoenix]

sure it can do,depends on how you approach it,it provides me comfort and reduces my stress levels. I know sooner or later I will have a big run.
Not many books would write positively about either method. but then again if the books were right,95% of traders would make money. I wonder:whistling

Books tend to be theoretical. Whether one chooses all-in/scale-out or scale-in/all-out or any combination thereof depends on the instrument and the bar interval and the timeframe and how well the trader has characterized his instrument and how thoroughly-prepared he is, at minimum. Otherwise it's just a crap shoot.

Db