Exit Strategies-Whatis your prefered way for exiting trades?
Posted: Tue May 22, 2007 9:06 pm
Hi there all you pirates,
Having a good plan for exiting trades is important because your exit strategy will determine:
Size of your profits
Size of your losses
Length of your trades
Amount of your risk
Size of your position
your percentage of winners
your avg. winner : avg looser ratio
your total return
I´m just reading / implementing / testing my way through different exit strategies.
At this point I was just wondering:
What kind of experience has been made with exit strategies by all the pirates from kreslik.com?
What are you considering for setting S.L.?
What do you do to reduce risk when the trade moves in your way?
What is your prefered way of formulating Profit Targets?
How do you lock in/protect your profits, without cutting your trade to early?
How do you measure the efficiency of your entries / exits?
Are you treating shorts and longs seperate or symmetric?
Are you running different exit strategies at the same time, and how do you combine/mix them?
What parameters are you using?
Are you doing all this with fixed parameters or do you link them to i.e. volatility or S/R to adapt to the markets?
Are you changing the settings when profit targets have been reached, or do you just exit?
Are you changing the settings when your entry signals have been lost or any other change of market situation occurs, or do you just exit?
How do you link all these matters to your sizing / money management?
Do you change your sizing while a trade is on its way?
What other questions do you consider important and what are your answers?
So, I hope that this is going to be a fruitful pirate discussion and therefore
I start with the following contribution.
all the best,
peter
--------------------------------------------------------------------------------------
I`ve uploaded a highly relevant document I`ve found on exit strategies into the download section. Its a .pdf of a presentation chuck lebeau gave on tradestation World 2004. It´s a good summary of the importance of exit strategies coming up with lots of ideas on how to use volatility for S.L., Sizing, P.T. and Trailing/reduction of risk/conservation of profits......
I think the exit strategies mentioned are quite interesting and, thought Lebeau is a system designer with a lot of experience, their application seems worth a try.
There is a good thread on exactly these exit strategies at the tradestation forum. That´s where I`ve downloaded the .pdf as well as all .eld files and some explanations on how to use / implement these stops.
https://www.tradestation.com/Discussion ... c_ID=32011
(You have to be a TS customer to use their forum)
A lot of interesting thoughts on exit strategies in general as well as some of the backgrounds / initial thoughts of the above mentioned exit strategies can be found there:
http://www.traderclub.com/discus/board.html
thought the forum seems abandonded and highly spammed, I recommend highly to go directly here:
http://traderclub.com/discus/messages/1 ... 20070515am
(Thats where you get if you click on 'Traders Club Bulletins' in the link previously given. If I´ve got it right, no login is necessary, otherwise the only prerequisite would be providing your eMail)
The bulletins by chuck lebeau are somehow old (about 2000), but seem still applicable with slight adaptions. I think they are very inspiring and worth reading. Lebeau has been working together with van tharp as well as alexander elder among others, that should provide some relevance.
More explanations on Lebeau's "Chandelier Stop" can also be found in alexander elder's book: "Come Into My Trading Room".
So, what do you do?
Having a good plan for exiting trades is important because your exit strategy will determine:
Size of your profits
Size of your losses
Length of your trades
Amount of your risk
Size of your position
your percentage of winners
your avg. winner : avg looser ratio
your total return
I´m just reading / implementing / testing my way through different exit strategies.
At this point I was just wondering:
What kind of experience has been made with exit strategies by all the pirates from kreslik.com?
What are you considering for setting S.L.?
What do you do to reduce risk when the trade moves in your way?
What is your prefered way of formulating Profit Targets?
How do you lock in/protect your profits, without cutting your trade to early?
How do you measure the efficiency of your entries / exits?
Are you treating shorts and longs seperate or symmetric?
Are you running different exit strategies at the same time, and how do you combine/mix them?
What parameters are you using?
Are you doing all this with fixed parameters or do you link them to i.e. volatility or S/R to adapt to the markets?
Are you changing the settings when profit targets have been reached, or do you just exit?
Are you changing the settings when your entry signals have been lost or any other change of market situation occurs, or do you just exit?
How do you link all these matters to your sizing / money management?
Do you change your sizing while a trade is on its way?
What other questions do you consider important and what are your answers?
So, I hope that this is going to be a fruitful pirate discussion and therefore
I start with the following contribution.
all the best,
peter
--------------------------------------------------------------------------------------
I`ve uploaded a highly relevant document I`ve found on exit strategies into the download section. Its a .pdf of a presentation chuck lebeau gave on tradestation World 2004. It´s a good summary of the importance of exit strategies coming up with lots of ideas on how to use volatility for S.L., Sizing, P.T. and Trailing/reduction of risk/conservation of profits......
I think the exit strategies mentioned are quite interesting and, thought Lebeau is a system designer with a lot of experience, their application seems worth a try.
There is a good thread on exactly these exit strategies at the tradestation forum. That´s where I`ve downloaded the .pdf as well as all .eld files and some explanations on how to use / implement these stops.
https://www.tradestation.com/Discussion ... c_ID=32011
(You have to be a TS customer to use their forum)
A lot of interesting thoughts on exit strategies in general as well as some of the backgrounds / initial thoughts of the above mentioned exit strategies can be found there:
http://www.traderclub.com/discus/board.html
thought the forum seems abandonded and highly spammed, I recommend highly to go directly here:
http://traderclub.com/discus/messages/1 ... 20070515am
(Thats where you get if you click on 'Traders Club Bulletins' in the link previously given. If I´ve got it right, no login is necessary, otherwise the only prerequisite would be providing your eMail)
The bulletins by chuck lebeau are somehow old (about 2000), but seem still applicable with slight adaptions. I think they are very inspiring and worth reading. Lebeau has been working together with van tharp as well as alexander elder among others, that should provide some relevance.
More explanations on Lebeau's "Chandelier Stop" can also be found in alexander elder's book: "Come Into My Trading Room".
So, what do you do?