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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: Tom Trader who wrote (12340)	1/10/1999 10:08:00 PM
From: SE	Respond to of 44573

Tom, Have you tried incorporating any scale trading techniques? That might be, in part, a solution to your question. -Scott

To: Tom Trader who wrote (12340)	1/11/1999 12:04:00 AM
From: elf	Read Replies (1) \| Respond to of 44573

Tom.... I think Chip has hit the nail on the head, If I understood your original post, you are seeking a formula to specify the numbers of contracts you would trade at any given time. the win loss ratio is really academic, your system should determine the win loss ratio based on past performance, IE. 1 contract or inf.# of contracts. as you suggested your win loss ratio is 3:1, therefore it will remain at 3:1 unless you change the buy or sell exponent of your formula... also if you look at Chips idea, the draw down again does not come into play..your best case profit was 10K. your draw down is 4K...... 11 contracts win $=110,000 vs. 11 contracts loss $44,000... your win loss ratio is still the same..... I have to assume that your win loss is really 3:1.... I can see your concern, you put on 11 contracts and start-off with a 44k hit,right, but it very well could be the other side of the odds. this is where you have to trust your system. also rather than bringing up your stops on a trade like this, you could sell calls against your long contract's. there are a vast number of option strategies one can use to hedge long or short future contracts.. good luck elf