Cut Your Losses?? (Mean Reversion)
- abgespaced
- Posts: 176
- Joined: Sun Aug 23, 2020 2:25 am
- Location: Australia
Well, because this post was bumped I'll chime in. Now that I feel I've got some kind of trading sense, "cutting your losses" to me means that I've made the wrong decision and the true value is now being reflected in the market price in opposition to what I thought the value was. It doesn't necessarily mean the price has gone against me after taking a position. The price often goes against me after taking a position, because the market is on the wrong side of the true value. So I hold my nerve and wait for a correction. But if I really have go it wrong, some signs will show and I will close out.
- Thebest147
- Posts: 93
- Joined: Thu Nov 05, 2015 8:01 am
If your opening order is taken quickly and it moves against you your on the wrong side and cut,
There aren't to many dummies playing on betfair you have to assume they know move the you,
There aren't to many dummies playing on betfair you have to assume they know move the you,
I started trialing a new system this weekend and I noticed my stop losses were taken before my trades. I watched the market carefully. The price then came in. This happened again over the next 5 events. Price came in.
Had there been no stop loss, all my trades would have gone green, and then some.
When automating, it is difficult to place that red exit
Had there been no stop loss, all my trades would have gone green, and then some.
When automating, it is difficult to place that red exit
- ShaunWhite
- Posts: 9731
- Joined: Sat Sep 03, 2016 3:42 am
You've discovered the issue with stop losses, they don't give you any advantage, and over time they break even at best.Vaz0202 wrote: ↑Sun Jun 19, 2022 8:32 pmI started trialing a new system this weekend and I noticed my stop losses were taken before my trades. I watched the market carefully. The price then came in. This happened again over the next 5 events. Price came in.
Had there been no stop loss, all my trades would have gone green, and then some.
When automating, it is difficult to place that red exit
I suggest you simply approach each bet with the same thought process, a reason to back and a reason to lay. That reason is never that you're £x up or down because the market doesn't know or care about that, so therefore you shouldn't. The market also doesn't care if you're opening a position or closing one, so respond to the market rather than considering what bets you happened to have some time before. I automate too, and the logic is just to bet, bet ,bet whatever side is appropriate, and then at the end, hedge any outstanding positions if there are any.
- firlandsfarm
- Posts: 2720
- Joined: Sat May 03, 2014 8:20 am
I don't use Stop Losses, I have a similar thought as Shaun. If for example you back at 5.00 and set a stop loss for 6.00 then if your stop loss fires you are effectively saying laying the runner at 6.00 is a good price ... that being so why did you back it at 5.00! You are looking for the point that if it drops to Y it's on a trend and will not recover.
- jamesedwards
- Posts: 2411
- Joined: Wed Nov 21, 2018 6:16 pm
Speaking of which, where is Shaun? Not been on the forum for three weeks.
Probably taking a political detoxjamesedwards wrote: ↑Thu Dec 07, 2023 4:26 pmSpeaking of which, where is Shaun? Not been on the forum for three weeks.
If we're considering sending out a search party already I propose to not send Dex and FF
- jamesedwards
- Posts: 2411
- Joined: Wed Nov 21, 2018 6:16 pm
Sounds like a good idea.Kai wrote: ↑Thu Dec 07, 2023 8:06 pmProbably taking a political detoxjamesedwards wrote: ↑Thu Dec 07, 2023 4:26 pmSpeaking of which, where is Shaun? Not been on the forum for three weeks.
I've found this to be true.
With betting my level of control is low so I have to mitigate it with small stakes and a high volume of bets.
With trading live my level of control is high since I'm more reactive to the behaviour of the market. Rather than a fixed stop loss, there are certainly moments when I know I should get out to not ruin the risk to reward in a short period of time. And yes even if it's +EV in the long run I will get out because my risk is too high to let it run, simple as that. I'm trading the moment, so the time frame is crucial. I will not turn my trading into betting. I treat them as different businesses.
As I trader I don't want to "pay" for the bad moments in the market. But when I bet I'm willing to do that, but the risk will be reduced.
Maybe I'm the reason Shaun has gone
In the This Forum thread I posted
Don't think it was outside the bounds of civility but it was what I thought at the time. Hasn't been seen since
PS I also misspelt supercilliousness
In the This Forum thread I posted
viewtopic.php?f=2&t=28300&start=15
Don't think it was outside the bounds of civility but it was what I thought at the time. Hasn't been seen since
PS I also misspelt supercilliousness