The foreign exchange trader how to use a good stop loss this double-edged sword
- 2023/2/26 6:26:17
- read: 3
just dabbled in foreign exchange trading, see the overwhelming quotations about trading, which on the stop- forextradingtime chicken soup quotes are countless, such as these: investment m forex trading session timestakes are not terrible, the most important thing is not to make continuous mistakes, to stop loss in time life is like the stock market, in the long life, should also learn to stop loss if you do not love me, I will immediately stop loss, never make a cheap Just do foreign exchange trading, was a lot of this "chicken soup". Never make cheap just do forex trading, was filled with a lot of this "chicken soup", cashback forex later found that these "chicken soup" is really not much use is the so-called do a line to fine a line, down to earth to read more books, knowledge system to get solid, more in the actual battle thinking reflective summary. Only in this way can we deepen our knowledge of trading, and constantly improve our trading level all day to see these false-headed quotes is a complete waste of time talking about stop-loss, most of us will be instilled with the concept of stop-loss when we first come into contact with forex trading, and then this concept takes root in our brains, ingrained in the essence of stop-loss is to control the risk, control the amount of their losses, which is part of risk control However, I would like to raise two issues here to discuss and help you deepen your knowledge of stop loss: First, have you ever abused stop loss? I think many newcomers will abuse the stop loss, which is due to excessive indoctrination stop loss concept caused by many newcomers in the beginning of the transaction, the brain is always taut a string: stop loss small editors at that time is also the case because of fear of loss expansion, newcomers usually set the stop loss distance is very narrow, the results of the order a little inattentive to be triggered by the stop loss, over time, the account formed a large number of loss orders, which not only hit This not only undermines the confidence of the newbies, but also gives them the illusion that "Why do I lose more money the more I stop? Stop loss in the end let me lose money or let me make money?" The problem lies in: you do not have a deep understanding of stop-loss and abuse stop-loss before talking about the essence of stop-loss control risk, and stop-loss is only one of the elements of risk control, another more important is position control (position control), which is more important than stop-loss on risk control, position control is the first, followed by stop-loss, and set a stop-loss, you also have to consider the profitability, if you simply stop-loss purposes If you lose the profitability because of the purpose of stop loss, then you are the bottom of the barrel. Many novice accounts due to stop loss caused by a large number of loss orders, and finally not only did not earn money but continue to lose money, which is simply to stop loss for the purpose of abuse stop loss to know that the ultimate purpose of trading is to make money profitably, can not make you unable to profit because of stop loss Many novices in the process of actual combat have had the experience of abuse stop loss, the stop loss is set too small, some people Also mechanically set the stop-loss distance, such as the stop-loss distance of each order is set 10 points, the profit target set 30 points small friend is this, the buddy also rally to blow with me: "My profit-loss ratio is 3:1, which means that even if my win rate is only 40%, I do 10 single, 4 single profit is 120 points, 6 single loss is 60 points, so I still make 60 points. So I still earn 60 points and, even if I do a single by the mon, my mon right probability is also 50% it! But the final result! His win rate is 15%, the final or loss of money is really too stupid and naive ah! Trading is really such a simple mathematical problem, then how will more than 90% of people are losing money! Mechanical stop-loss setting is a very stupid practice, any rigid thing will be inapplicable and will be eliminated along with the above topic, I introduced the second problem: Second, how to set a stop-loss? People who ask this question are just trying to figure out "how to establish a stop-loss point?" However, there is no answer to this question, if there is an answer, there are millions of answers every trader in the process of learning to form their own unique trading thinking, some people think that they should set a stop loss near some support and resistance, some people think that they should set a very wide stop loss, some people think that only when the market will happen a major event to set a stop loss, the general situation is a manual stop loss, each The thinking of each person is different, but this does not prevent traders from making money, I have contacted some traders, there really is no stop-loss masters, but he will do some hedging risk orders, while the position are controlled in a very small range, the current profit effect is very satisfactory or the words: the best for the best! I believe that this is by far one of the most classic quotes in the trading community in the process of trading in the real world, what you think you know is one, in the trading system or trading strategy, if there are conflicting elements, will inevitably affect your overall trading performance, so everything must be suitable, only then will it be one! With the accumulation of experience, the deepening of knowledge, you will naturally have their own set of stop-loss program so, stop-loss is a nunchaku, harnessed it is your weapon, harnessed, it will become a tool for your self-harm! Finally, there is a topic to talk about: manual stop loss and automatic stop loss we discussed above are automatic stop loss, even if the software set a good stop loss point, and then automatically executed by the computer since it is automatic stop loss need to set the stop loss point, which is back to the previous question, there is no answer to this question our software above there is a moving stop loss (trailing stop) function, which is a very good tool, however, how set the distance of the moving stop, this question has no answer, or there are millions of answers in addition to the automatic stop loss, we can also manually stop loss, manual stop loss is commonly known as: "chopping", "cut", refers to the traders own manual operation to close the loss Automatic stop loss and manual stop loss orders have their advantages and disadvantages, automatic stop loss can make trading more planned, so that you can avoid some emotional trading, but the disadvantage is the lack of flexibility; and manual stop loss is the opposite, manual stop loss is more flexible, can be random and change, depending on market changes, but often in the implementation, easy to be affected by emotions, can not cut the position and cause losses to expand so that Stop loss, it is really easy to say it is difficult to do ah!