Interview with Cheng

Re: Interview with Cheng

Postby Cheng » Mon Mar 08, 2010 9:01 pm

winston wrote:
millionairemind wrote: If he is always taking losses and fast profits, very soon he will be washed out of the game. His profits cannot cover his losses.


The rule is in MM's signature.

Three good trades can cover Seven losses, as long as you cut quickly on the bad trades and let the profit RUN on the good trades ..


Different market situation calls for a tweak in strategy. In a sideways market like now, how many +40% can you get? The possibility of -10% is high if your enteries are not good. Basically 80% of the time he is cutting losses, I don't think he has any winner to ride.

What would you do in a no clear direction market? For traders, I suggest standing on the sidelines first or only risk less than 20% of your total capital. Money management is there, but the Method is not right.
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Re: Interview with Cheng

Postby learn2win » Mon Mar 08, 2010 9:10 pm

Cheng wrote:
winston wrote:
millionairemind wrote: If he is always taking losses and fast profits, very soon he will be washed out of the game. His profits cannot cover his losses.


The rule is in MM's signature.

Three good trades can cover Seven losses, as long as you cut quickly on the bad trades and let the profit RUN on the good trades ..


Different market situation calls for a tweak in strategy. In a sideways market like now, how many +40% can you get? The possibility of -10% is high if your enteries are not good. Basically 80% of the time he is cutting losses, I don't think he has any winner to ride.

What would you do in a no clear direction market? For traders, I suggest standing on the sidelines first or only risk less than 20% of your total capital. Money management is there, but the Method is not right.


It is ultimately what kind of investment or trading method is suitable for you. Well, there will always be people that are flexible and do all kinds of trading.

You can be wrong for many times but one time right and you will get back all those losses plus lots of profit. If you are changing your strategy all the time, then when it is time to ride the big wave, you will get out only with a small profit.
Guard Thy Treasure from Losses - The Fourth Cure for a Lean Purse - George Clason
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Re: Interview with Cheng

Postby Cheng » Mon Mar 08, 2010 9:24 pm

learn2win wrote:It is ultimately what kind of investment or trading method is suitable for you. Well, there will always be people that are flexible and do all kinds of trading.

You can be wrong for many times but one time right and you will get back all those losses plus lots of profit. If you are changing your strategy all the time, then when it is time to ride the big wave, you will get out only with a small profit.


I'm always a fan of riding your winners! :D Don't misunderstand me, I mentioned tweaking your strategy, not change the whole strategy. Keep the core strategy "Cut losses fast and let winners ride". But in this case, in a trendless market, your possible winner is at most +30 to 40%? Each sideway trend volatility is around 20-40%? In this way one will be hitting a lot more -10%s than baiting a big winner. That's why I mentioned about method. :)
"The really big money tends to be made by investors who are right on qualitative decisions." Warren Buffett

"Risk no more than you can afford to lose, and also risk enough so that a win is meaningful." Ed Seykota

Scan with FA, Time with TA, Volatility is my Friend. :)
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Re: Interview with Cheng

Postby learn2win » Tue Mar 09, 2010 12:00 pm

Cheng wrote:
learn2win wrote:It is ultimately what kind of investment or trading method is suitable for you. Well, there will always be people that are flexible and do all kinds of trading.

You can be wrong for many times but one time right and you will get back all those losses plus lots of profit. If you are changing your strategy all the time, then when it is time to ride the big wave, you will get out only with a small profit.


I'm always a fan of riding your winners! :D Don't misunderstand me, I mentioned tweaking your strategy, not change the whole strategy. Keep the core strategy "Cut losses fast and let winners ride". But in this case, in a trendless market, your possible winner is at most +30 to 40%? Each sideway trend volatility is around 20-40%? In this way one will be hitting a lot more -10%s than baiting a big winner. That's why I mentioned about method. :)


No worries lah. All of us are learning. :)

The main problem with tweaking strategy is that when you sold your stocks thinking that it is a trendless market. Will you have the guts to buy back the stocks when it rockets up?
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Re: Interview with Cheng

Postby kennynah » Tue Mar 09, 2010 12:05 pm

I'm always a fan of riding your winners!


i have friends who like to "ride" other things... 8-)
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Re: Interview with Cheng

Postby lithium » Tue Mar 09, 2010 1:14 pm

learn2win wrote:No worries lah. All of us are learning. :)

The main problem with tweaking strategy is that when you sold your stocks thinking that it is a trendless market. Will you have the guts to buy back the stocks when it rockets up?


I think this is more difficult than cutting loss. Emotionally stressful. But I think "Stop loss" and "Chase back"(does it have a name?) are important skills in trading. If you don't chase stocks, you will lose big time to buy and holders in bull market. :)
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Re: Interview with Cheng

Postby learn2win » Tue Mar 09, 2010 1:29 pm

kennynah wrote:
I'm always a fan of riding your winners!


i have friends who like to "ride" other things... 8-)


Your friend surname Neo? :P
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Re: Interview with Cheng

Postby LenaHuat » Tue Mar 09, 2010 3:56 pm

:lol: :lol: :lol:
Or Li :?: It's difficult to get off a tiger or tigress.
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Re: Interview with Cheng

Postby Aspellian » Tue Mar 09, 2010 5:18 pm

wonder why MEN (especially successful and powerful men) always succumb to temptations at the most unlikely moments??? :?:

PROMISE, PASSION, PEACE, POWER, PURPOSE, PLAN, PATIENCE, PERSEVERANCE, PROTECTION
DELIGHT, DISCIPLINE, DILIGENT, DETERMINATION, DESIRE

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Re: Interview with Cheng

Postby iam802 » Tue Mar 09, 2010 5:31 pm

Aspellian wrote:wonder why MEN (especially successful and powerful men) always succumb to temptations at the most unlikely moments??? :?:


Wrong. I think it happens to all sorts of MEN.

Only difference is the media likes to report on the successful and powerful.

THAT is news.
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