4 replies to this topic

[89S10]

I'll start by defining scalper as someone who buys and sells, with holding periods measured in seconds. If your average gain is one unit, how much pain do you take before you get out of a bad trade? I know that if we have a success ratio, and some sense of the distribution of trading outcomes, this number can be optimized. I am just curious what traders actually do.

[hiker]

--- thanks.

Edited by hiker, 20 September 2007 - 02:28 PM.

[Bob-C]

I'll start by defining scalper as someone who buys and sells, with holding periods measured in seconds.

If your average gain is one unit, how much pain do you take before you get out of a bad trade?

I know that if we have a success ratio, and some sense of the distribution of trading outcomes, this number can be optimized.

I am just curious what traders actually do.

Hi Rick, see my reply to your reply here. ---> http://www.traders-t...showtopic=76419

Cheers,

Bob-C

[maineman]

For my in/out futures trades which I do off of the NYSE TICK readings, I am out with a profit within 20-30 minutes (rarely a minute or two more) or a fixed loss of 8 points. So for me its a combination of points and time. This is a very specific trade. For my options "scalp" trades it depends on market conditions and the VIX. For these trades the loss is taken based on a trade "failure" i.e. the idea should work out very quickly and, if not, the trade is exited as gracefully as possible. NO trade is taken without specific goals and those goals are followed. No ifs, ands or buts. mm

[flyers&divers]

I scalp Crude Oil and sometims ER2 and more lately the DAX futures(see my thread "Some observations on scalping Crude" at the Elite Trader Board). First, each market is different and needs to be traded differently. In ES there are thousands bid and offered at every level so one can't expect a quick fill even though the target is reached. This would make a trader going for a tick or two very nevous. On the other hand ER2 is a more mercurial market, it is gyrating around an imaginary mean providing ten times more opportunities then ES an the likelihood of fills is better. Crude is a good scalping market because it is a big contract with many price points and huge daily ranges. The best one is DAX which is a + - 250K contract. Because it is so big even a hint of activity in the other indices produces a move worth a couple of hundred Euros. One can not trade for one unit because the losses will be bigger then one. An experienced trader like myself has a win loss ratio of 65/35 but losses, scratch trades and comissions eat into it. I trade ER2 for 3-4 ticks, oil for 3-4 ticks and DAX for 4-6 ticks. Also one can not fade the oil or DAX or fade them only when a move shows signs of exhaustion, like the indices in the last 24 hrs. When trading for a couple of ticks one does not have time to mess around with stops, it is just not efficient. One just gets out when the trade is out of hand, this is why if one can not pull out at least 65% winners out of any series of 50 trades one has no hope of being profitable. In general the more hectic a market is the safer it is to scalp because a wildly swinging market is seldom directional. The big money is not in scalping off the screen but in swing trading. I don't mind getting caught on a wrong side of a move with a one or two lot position but getting caught with a sizeable position would be deadly. Almost forgot to mention I trade off 16 second bar charts and use the one minute and 3 minute charts for prerspective, sometimes glance at a 60 min chat. The markets are so liquid that even the 16 sec charts show all the well developed formations. F&D

Edited by flyers&divers, 20 September 2007 - 07:44 PM.