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Managing old positions
Posted: Mon Oct 12, 2009 12:06 pm
by LeviF
I'm participating in some huge moves in some trades that my system has been in for a long time. The problem is, the gains are small compared to my current equity since the trades are so old. Any one ever experience this?
Posted: Mon Oct 12, 2009 12:17 pm
by Mic
Interestingly it seems as if adjusting to gains in the equitycurve does not pay out compared to adjusting for volatility. Maybe because of the increased risk of reversals after a long trend. You do not want to be highly exposed when the correction comes. Especially as all markets tend to correct together nowadays.
Posted: Mon Oct 12, 2009 12:35 pm
by LeviF
Guess we just have to take the bad (or not quite as good) with the good.
Posted: Mon Oct 12, 2009 2:31 pm
by RedRock
Hows that old saw go...
Ones winning positions are never big enough, losers, small enough.
I'm sure Ralph Vince would have an equation to explain the quandary though.
Posted: Mon Oct 12, 2009 2:54 pm
by LeviF
Of course.