Hello sara, i am a systematic risk manager and i have a fixed rule of 1:5RR. My data shows 3wins aiming 1:5RR in 15 trades will still put me up in profit. The problem now is 80% of the time I analyze the price next Demand/supply it plays out as planned which if i had extended my take profit I would be getting more than 5RR. The back side of extending my RR is price may give me a 5RR and reverse to change structure. My question is, being rigid with my 5RR trading rule, is it a limitation to my trading or a good discipline ?
Personally, I'd choose to take most at 5RR as your stats indicate and leave a runner based on this extra potential you're seeing. Some extra thoughts:
1. Ideally, we want to optimize targets to make the most of the market. An interesting metric for you here: start tracking the % of the move VS the % you actually caught.
2. Making our targets solely result based (5RR, in this case) doesn't allow much flexibility for trade management. An idea would be to make your first partial 5rr but your runner based on market dynamics (key levels, for instance) which would consider the type of market in question.
I think we learn more about our strengths and weaknesses as traders. If a trade goes against me, I try to imagine if I'd make the same trade at the current price and setup. If not, I cut my losses and look for a better opportunity. That's the plan, but I need to do a better job of following it. Not giving up is a big part of being in business and karate for me, I need to do a better job of reframing "giving up" on a trade.
That's also true - as we trade, we learn more about ourselves. However, this knowledge is always available to us not necessarily through trading. Not giving up mindset is amazing in sports and it can also be in trading if you associate it with the right variables. Cheers
That's an excellent question. There's a qualification process and a discovery call to get me closer to that understanding. But it's not granted. This is the reason why setting expectations at the coaching start is crucial - I'm not gonna generate trading results for the client! We're there to achieve performance excellence which might or might not equate with results. There are multiple variables I don't control - self-accountability, effort put in the program, commitment, readiness to change and the clients *edge*. If there's no edge or the client is not a good fit, the best decision is to put an end in the coaching relationship.
Hello sara, i am a systematic risk manager and i have a fixed rule of 1:5RR. My data shows 3wins aiming 1:5RR in 15 trades will still put me up in profit. The problem now is 80% of the time I analyze the price next Demand/supply it plays out as planned which if i had extended my take profit I would be getting more than 5RR. The back side of extending my RR is price may give me a 5RR and reverse to change structure. My question is, being rigid with my 5RR trading rule, is it a limitation to my trading or a good discipline ?
Great question.
Personally, I'd choose to take most at 5RR as your stats indicate and leave a runner based on this extra potential you're seeing. Some extra thoughts:
1. Ideally, we want to optimize targets to make the most of the market. An interesting metric for you here: start tracking the % of the move VS the % you actually caught.
2. Making our targets solely result based (5RR, in this case) doesn't allow much flexibility for trade management. An idea would be to make your first partial 5rr but your runner based on market dynamics (key levels, for instance) which would consider the type of market in question.
Hope this helps spark some new ideas!
I think we learn more about our strengths and weaknesses as traders. If a trade goes against me, I try to imagine if I'd make the same trade at the current price and setup. If not, I cut my losses and look for a better opportunity. That's the plan, but I need to do a better job of following it. Not giving up is a big part of being in business and karate for me, I need to do a better job of reframing "giving up" on a trade.
That's also true - as we trade, we learn more about ourselves. However, this knowledge is always available to us not necessarily through trading. Not giving up mindset is amazing in sports and it can also be in trading if you associate it with the right variables. Cheers
That's an excellent question. There's a qualification process and a discovery call to get me closer to that understanding. But it's not granted. This is the reason why setting expectations at the coaching start is crucial - I'm not gonna generate trading results for the client! We're there to achieve performance excellence which might or might not equate with results. There are multiple variables I don't control - self-accountability, effort put in the program, commitment, readiness to change and the clients *edge*. If there's no edge or the client is not a good fit, the best decision is to put an end in the coaching relationship.