Your opinion please - page 6
You are missing trading opportunities:
- Free trading apps
- Over 8,000 signals for copying
- Economic news for exploring financial markets
Registration
Log in
You agree to website policy and terms of use
If you do not have an account, please register
i see where we disagree,
You loose 150pips + spread, but in my calculations i loose 150pips inclusive spread. I always calculate my stops including the spread. (Of course at cost of probable win)
Maybe that is a personal thing, but if i want to loose 50pips i do not want to loose 50pips+spread.
I hope you are able to get my point i cannot find the right words to explain it
Lol, this is like nano-particles theory. At Point-C you decided to go 2-Lots. Why would the guy holding the same Equity as you Not decide to go 2-Lots as well?
Er, that's exactly the point. Both the hedging and non-hedging strategies go long 2 lots at point C. If you have an open buy and an open sell from point B, and you close the sell and also open another buy order, then your net position has just changed from flat to +2. Both implementations of the strategy go from flat to long 2 lots at point C; they just do it in different ways. (If the hedging strategy were to leave the buy open from order A and to open a new buy order for 2 lots instead of 1 lot, then the equivalent non-hedging version would be to go long 3 lots, because that's exactly the same.)
I've shown you that there is a sequence of non-hedging orders which is financially equivalent to your hedged orders regardless of whether the price rises or falls after point C. Nevertheless, you seem to persist in believing that they can be financially identical but somehow without having the same net positions in the market. I'm not sure how you think this is possible.
In the best cases, which zzuegg has identified an example of, then the hedging and non-hedging alternatives are financially identical. This relies on there being no swap, and also the number of lots traded being the same. In zzuegg's example from 19:58, both the hedging and non-hedging variants trade a total of 3 lots. But that's the best case. In dabbler's example from 21:31, the hedging strategy trades 3 lots and the non-hedging variant trades 2 lots. Let's say that you were dealing with a broker who had a fixed spread plus commission (rather than a commission built into the spread). It's then self-evident that it's costlier to trade 3 lots than 2 lots. The hedging strategy can at best equal the non-hedging strategy, but cannot be better, and will be worse in some cases. Plus, of course, swap - unless the hedged grid always resolves within a day.
This is such a drastic change in examples that I don't even know what to say. Did you just really just turn a A B C D example into a A B C example and made price go straight down? This is why your graphs are so hard to understand. Price seem to be defying gravity.
If I open a sell on your graph and close it at B, the price continues downward. Therefore placing a Buy order would never help me.
So I guess you mean price went down by 50 and then went up by 100. That'll be a reverse case to Zzuegg's example. Drastic Change #1.
Then, you seem to be Happy with 46 pips in your example. But hum..hum..hum, instead of taking the profit with your Sell and call it a day.
You decide No, I'm going to place a hedge. Then I'm going to Close All position at C for less profits then when I began with the Hedge. Drastic Change #2.
Next drastic change, I'll totally ignore the move from Point-C to Point-D and still claim I have created some form of equation.
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
If one stays true to Zzuegg's path then the Combination of Non-Hedge would be what he listed. And what jjc displayed a while ago. Which is Sell 1-Lot at A and then Sell 2-Lots at C. <-- This creates your 250$ profit since we're trying to make em equivalent. Zzuegg's total lots=3, Zzuegg's Stop-loss total lots=3, JJC (interpretation) total lots=3. The spreads would all be the same. So again I ask, why is hedging worse?
However Dabber would like to short change the chart by only going til point C. And if he's going to do that then I too would like to stop at only point A to B.
i see where we disagree,
You loose 150pips + spread, but in my calculations i loose 150pips inclusive spread. I always calculate my stops including the spread. (Of course at cost of probable win)
Maybe that is a personal thing, but if i want to loose 50pips i do not want to loose 50pips+spread.
I hope you are able to get my point i cannot find the right words to explain it
This is such a drastic change in examples that I don't even know what to say. Did you just really just turn a A B C D example into a A B C example and made price go straight down? This is why your graphs are so hard to understand. Price seem to be defying gravity.
My bad, I was writing whilst watching a film on the TV so I got my buys and sells swapped (now corrected). Sorry about that.
Yes I turned an ABCD into an ABC. Why? The ABCD is equal on both methods as proved by zzuegg. I agreed with his calculations. Game over on that trade. New example. In the new example there is a difference.
The reason why I stopped at point C, that is what the rules of the system say. Stop when you get the profit. You seem to be aggrieved that I am "short changing" you somehow.
My bad, I was writing whilst watching a film on the TV so I got my buys and sells swapped (now corrected). Sorry about that.
Yes I turned an ABCD into an ABC. Why? The ABCD is equal on both methods as proved by zzuegg. I agreed with his calculations. Game over on that trade. New example. In the new example there is a difference.
The reason why I stopped at point C, that is what the rules of the system say. Stop when you get the profit. You seem to be aggrieved that I am "short changing" you somehow.
Ah, new problem this is too much fun. The hedge equivalent as I see it. Would be to Hedge@A. Close the Buy@B. And secure the Win@C. Humm, I think we have equal spreads. And Lord knows what the Swap Setup is. <--- So you see my point....Finding the Hedge Equivalent or Non-Hedge Equivalent depends highly on Knowing the Future.
I'll agree with you on this because maybe that's where we cannot see eye-to-eye. If someone places a Hedge-Order Simultaneously and proceed to close them Simultaneously, that'll always be worse than taking a Directional Position. <--- OMG I'm wrong even when I try to agree with you. Slapping my face, this too depends on which direction price goes. Crystal Ball Anyone?
Added: what I meant to say is Simultaneous would do worse than staying out all-together.
Hooray!
(sith voice) Your diagram is weak old man.
On my diagram time goes left to right. A net long position is blue. A net short position is red. The net position size is shown mid way along the line. Green nodes are wins where the position is closed. Up is a higher price meaning a win for a long position.
EDIT: image changed as previous one was wrong.
My diagram is simplified to neglect parallel paths that nevertheless end up at the same point. There are actually an infinite number of routes to C3, even sticking to the grid. The calculations then become summations of infinite series or finding the solution to a recurrence relation (this latter one is sadly beyond my mathematical ability).
Assuming a random walk, the chance of reaching C1 is 50%, neglecting the spread. Your homework question is what is the chance of reaching C2?
EDIT: original question asked for C3, but altered plot made C2 a non-trivial calculation.
Hello!
I would like to know what you think about this "strategy".
We open trade (buy or sell it is not important) without TP and SL. Then if we get to profit we previous chose we close order if it gets to loss we previous chose we open opposite trade with bigger lots. Then if second and first trade get to profit we previous chose we close orders if second gets to loss we previous chose we open third trade with bigger lots opposite to second,... and so on.
What I'm thinking about is that price will sooner or later goes in some direction.
Thanks for your comment and have a look at picture for more information!
many thanks....
I would like to know what you mean about this "strategy".