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Gary Fritz wrote:
>In that response you quoted Van Tharp:
>
>> There is one kind of exit that is designed to get rid of losses,
>> but it totally goes against the golden rule of trading of
>> cut your losses short and let your profits run.
>
>That "golden rule" applies ***ONLY*** if you are trading a trending market.
>"Let your profits run" is a guaranteed way to LOSE in a reversing market. In
>a market like that, scaling out makes a lot of sense.
Not as far as I've been able to determine. If you have a strategy
that takes advantage of reversals, then it's still better to take
all your profits at once rather than scale them out. Rather, I've
found that scaling them *in* works pretty well as long as you exit
them all at the same time.
YMMV, of course, but my experience tells me it doesn't matter if you
have a trend-follower or a reversal strategy.
-Alex
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