Cut losses - The Truth, The Pain, and The Chance! (2)
The truth behind Uncle8888's no stop loss!
Uncle8888 has no-stop loss and he knows what he is doing. But, are you absolutely sure that no stop-loss strategy is actually right for you in the long run? Think about it seriously.
It is critical that you fully understand this!!!
"It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong." ~ George Soros
Any capital losses whether it is realised or unrealised losses are capital invested with NEGATIVE GROWTH and over long run you are going to be badly hit by inflationary impact. So it is not a simple matter of holding power or not! You must carefully evaluate you own investing performance and determine whether is no stop loss strategy is still right for you? For how long can you continue to take on negative growth?
What happen if no stop loss?
In the worst case, you will lose 100% of your invested capital. If you are prepared to lose 100% of your capital; then are you equally capable of holding multi-baggers to offset losses. If you think your emotions and personal psychology doesn't allow you to do it; then you better think twice of no stop loss stratgey as it may not be actually right for you.
"It's not whether you're right or wrong that's important, but how much money you make when you're right and how much you lose when you're wrong." ~ George Soros
Wise words from George Soros!!!
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23 minutes ago
that is why learning from the pro is dangerous! if a trader who trade leverage futures product will end up brook pretty fast.
ReplyDeleteand whose who think that they are hedged are actually doubling their risk, hence leverage, thats standing in dangerous ground without even realise it.
well said.
Especially for forex, leveraging at 200-400 times is crazy!
ReplyDeleteyes, leverage have to be understood first, without knowing the effect, one cannot control their risk.
ReplyDeletefor investing, i guess it is compound returns, not just returns that gives superior results.
with no (low) leverage plus compound returns, i don't see why a person cannot make money. the reason has to be something else.
with my kids entering adulthood, its high time i learn about investing together with them and hopefully i'm not a hinder to their learning as i've been a trader for so long.
hello Uncle CW
ReplyDeleteIf I may OT here a little.
I would like to read your blogs from my smartphone. Would you like to enable the "mobile" mode of your blog ? Helps a lot for my eyes. Thanks Thanks
Done. Pls help to check it out.
DeleteThank you Uncle CW.
DeleteIt works & i have bookmarked your blog.
Looking forward to your frequent & interesting updates.
Huat ah.... ^-^
CW8888,
ReplyDeleteAnother great post sharing from personal experience what works for you!
Its interesting that we both have stocks that have gone to zero; and from the ashes, your phoenix is multi-baggers, while my phoenix is 10% cut-loss rule.
Your defense is offense!
Your Tao more power :)
smol, "fish and the bear craw, how can we have both?". i tried for the past years, what i got was fish bone and bear nail.
ReplyDelete