Twenty-four, and not one iota more! - page 3
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https://forum.mql4.com/ru/37748/page14 about stops
Thank you. It's on topic:
.... we have to be very much afraid of these very tails. They are rare, but if we catch them from the wrong direction, we will fly in very hard and fast. We do not know the time of their appearance, neither their strength nor their vector, but we do know that they will be there. The only thing we can do is to cut them off with hard stops. There's no more effective tool than a simple stop: it's guaranteed to shave those tails off, keeping them out of bounds. You can take any value as a stencil for the haircut: a certain number of standard deviations or an ATR value or a fixed value expressed in pips. Whatever you want, it doesn't matter as long as they shave those tails.
and more
For the same reason the use of profit levels (Take Profit) is much less effective than use of protective stops. Firstly, we never catch the tails that develop in our favor (because we also shear them), and secondly, the probability that the price will not reach the necessary amount and turns around is lower than normal, therefore we will lose more on returns than we would with normal distribution. For the same reason, pulling up the stop is also inefficient. Price will more often than not randomly reverse and execute our pulled stop, resulting in more often than not we will not make a profit.
Although this paragraph raises questions: if pulling a stop is ineffective, where do we take profit?
Such a thought has crossed my mind. About a very short stop. I looked somewhere at statistics of the most successful either funds or private traders - the ratio of profit / loss there is simply monstrous, many times over. But the question: What if the stop was eliminated by a false-break, should I enter again in the same direction? After all, these things are interrelated - after a stop you have to enter somewhere.
If indeed it is false - what has changed? Of course, going in.
This problem is one of the "everlasting ones". As an option, pendants instead of stops.
This is one of the "everlasting" problems. This is an option - pendants instead of stops.
Yeah, I know. But are timeless issues even worth discussing?
I'm a bit confused, how does a pendulum save? Isn't a stop a pendulum? Explain, please.
If indeed it is false - what has changed? Of course, entering.
It's a perennial problem. There's an option here - pendants instead of stops.
And one more thing: in a flat, even a very insignificant one, you may get so high that within a range of a hundred pips you will manage to lose your entire deposit. See the week before the New Year on the Euro-dollar.
also go to him https://www.mql5.com/ru/users/svinozavr say the pros about the stops.
how the pendulum will save
If instead of 1 lot we enter 0.5, and instead of the stop we put another 0.5, the total stop of 1 lot will move down. Essentially, all other things being equal, we decrease the risk of being out of the trade. But we also decrease the profit if there is no ejection.
And this scheme may work better at flat... well, it depends on the general strategy.
If instead of 1 lot we enter 0.5 and put another 0.5 instead of the stop, the total stop of 1 lot will move down. Essentially, all other things being equal, we reduce the risk of being out of the market. But we also decrease the profit if there is no ejection.
And this scheme may work better at flat... Well, it depends on the strategy.
I don't get it at all. Divide the lot by two, multiply it by two.
I don't get it.
Nah, don't go to him, he's a laughing stock...
I do not understand at all. I want to divide the lot by two, or multiply it by two.
Let the strategy be that we should enter 1 lot with a stop of 50p.
The price is 1.32, there is a lot of noise.
Then either 1 lot with a stop of 1.3150. Or 0.5 lots with a stop of 1.3125 and pending buy at 1.3150 with a stop of 1.3125. (I need to recalculate more precisely).
I.e. the total stop has moved by 25 points, the risk has decreased, but so has the profit, if the second lot will not trigger.
It looks like this.
Let the strategy be that we should enter 1 lot with a stop of 50p.
The price is 1.32, there is a lot of noise.
Then either 1 lot with a stop of 1.3150. Or 0.5 lots with a stop of 1.3125 and pending buy at 1.3150 with a stop of 1.3125. (I need to recalculate more precisely).
I.e. the total stop has moved by 25 points, the risk has decreased, but so has the profit, if the second lot will not work.
So it is like this.
How much is the pending buy (which is already after the stop has been triggered)? 1 lot?
I still don't get it - if your system says buy! - and you don't trust it, reducing the lot, then why trade? It is easier not to enter - for sure it will not cheat.
In general, I'm very skeptical of systems that reduce risk by reducing profits. We trade for the sake of profit. If you don't want to take risks - just hang on the fence and that's it.
But that's just a philosophical conclusion.