It's a tough habit to try and change, when you reach that situation again it's always tempting to think "maybe this time will be different!" but hopefully you'll at least be a bit more aware about the thought process now.
I think most people do! The first step is being aware of it (which most people don't even get to), now comes the tough bit of trying to work on it. - Nicholas
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Great video. I had this situation today with two trades, iron butterflies sold before earnings announcements for CRM and LOW. CRM was great, it opened nearly flat, so I closed it out ASAP and pocketed most of the maximum gain. Turns out later in the day it actually repeatedly hit max gain, but if I knew the future, well I wouldn't have problems. LOW gapped down on a below expectation result, I closed the calls cheaply, and waited for a fade back towards the previous close. I've noticed this repeatedly when a stock gaps down on a surprise. It didn't snap up at all, and started trailing even further down. This was distressing..."I used to have that money. I saw the balance in my account." I held longer to see what it would do. It came back mostly to where it had been and I closed then (for a loss on LOW, but a good profit for the day) reasoning "I am only holding this because I want the loss to go away, but if someone presented me this position as a new trade right now, I wouldn't take it." Which seems pretty rational, but somehow the fact that I was making a profit over the two trades made it easier. Otherwise I wait and let it play out a bit. Later in the day LOW came back up partly and it would have been a profitable trade. Oh well. If I knew the future...
9:31 - "I'm on this game show only once, I might as well make the most of it" -> Turns down guaranteed 6k for 50/50 shot at 10k...don't squander a lead for an all-in small chance, don't get emotional 11:14 - after losing huge, ADJUST FRAMING - don't make big ball plays to gain it all back. Breathe. Shift your goal smaller (lower position/exposure) and focus on what you have remaining; build from a solid base not a lofty one 14:30 - "House Money Effect" - taking bigger risk when playing with profits (house money/free money)
The dilemma is using a trailing stop to exit your trade vs setting target prices. I have used target prices and ended up missing out substantial profits. It is a double edge sword and you have to make a decision either way! If you made substantial profits then, it is not too bad!
nicholas, if you know a book that deals with these kind of choices and variations, and maybe the corresponding human bases in deal no deal i'd like to know the title/author, because im sure this thing affects a lot of traders end results and mine as well ty that was a super entertaining video ;) edit: i googled behavioral economics and found the books
In the scenario when you have five cases there is only one way to guarantee a higher offer from the bank. And that is to have your own case contain the 500k. And when there is five cases left there is a 20% that the players case contains the 500k. So that means 80% of the time you are better off taking the bankers offer.
We try to stay impartial with brokers and not recommend any specific ones. However, you should be able to find a list online of approved brokers which are regulated by the FCA (in the UK) or other major regulators. That's a good place to start. If you need an opinion on any specific brokers, send us an email at contactduomo@duomoinitiative.com
Would you exit a wining trading that is giving you profit and has not hit your stop loss? I personally don't think you should ever exit as long as it is giving you profit.
If there is a strong enough reason to think it’s hit a strong path of resistance and is unlikely to proceed, or if there is some additional risk event coming up.
I understand that one would take the 75k in the show however I believe that if you take profits before they reach your predefined most probable level consistenly, you'll end up making less money in the long run. Nonetheless I normally move my stop loss to profit, taking into consideration my evolving risk to reward (trying to keep as much profit without reducing too much the likelihood of hitting my original target).
In my opinion, it's ok to change your target as long as it's for the right reasons. If you're moving it because you're getting worried and want to exit the trade to have something certain - that's the wrong reason. However, not moving your target can sometimes be a mistake. Every time the price moves, the overall landscape in the market is changing. The situation and probabilities could be very different from when you entered your trade. Your target when entering is just to assess whether the trade is viable and after that point you need to keep assessing where the correct place to exit is based on the facts you have at that moment in time. That can sometimes mean having a more profitable OR a less profitable target.
JibasJr and you're right. i've run a lot of simulations with a random walk model that showed me conclusively that taking partial profits is one of the great pitfalls you can step into. remember "lett your winners ride and cut your losses short". most traders don't know how to implement this gold advice and thats why they're never profitabel. but the solution is simple: place a trailing stop. i don't use take profits.
I really working on a demo few years now , now im realy confident with my system after many years of testing,my only problem now how i can find a reliable broker,pls help me on this matter
Shit, you described me :-/ I really need to stop this, I’ve made profit trading but just trying to get that extra bit of money puts me in an ugly spot.
I have that tendency of waiting for that little bit more and then it's just reverses and goes against me :( that has changed now , never again...maybe
It's a tough habit to try and change, when you reach that situation again it's always tempting to think "maybe this time will be different!" but hopefully you'll at least be a bit more aware about the thought process now.
Kyle Wong Lee I
What I do is exit a trade when it meets my target...Or when I start to feel shitty about the trade.
Having a plan in place helps a lot. One will not go broke by taking full or partial profits at key levels.
wow, such a creative and dope analogy 👌🏾
Thanks! Glad you liked it
Great video, I have struggled with Framing. It's something that I'm aware of and try not to submit to, but your explanation is elucidating.
I think most people do! The first step is being aware of it (which most people don't even get to), now comes the tough bit of trying to work on it.
- Nicholas
This is one of the most important videos
🔹 Get FREE access to the Duomo Trader Development Program: duomotrading.com/FreeDuomoTraining
🔹 Add us on Instagram: instagram.com/duomoinitiative/
🔹 Our second channel for financial news and analysis: ua-cam.com/users/MarketMoversFinancialNewsandAnalysis
I would have grabbed the 74k hell yeah
Great video. I had this situation today with two trades, iron butterflies sold before earnings announcements for CRM and LOW. CRM was great, it opened nearly flat, so I closed it out ASAP and pocketed most of the maximum gain. Turns out later in the day it actually repeatedly hit max gain, but if I knew the future, well I wouldn't have problems.
LOW gapped down on a below expectation result, I closed the calls cheaply, and waited for a fade back towards the previous close. I've noticed this repeatedly when a stock gaps down on a surprise. It didn't snap up at all, and started trailing even further down. This was distressing..."I used to have that money. I saw the balance in my account." I held longer to see what it would do. It came back mostly to where it had been and I closed then (for a loss on LOW, but a good profit for the day) reasoning "I am only holding this because I want the loss to go away, but if someone presented me this position as a new trade right now, I wouldn't take it." Which seems pretty rational, but somehow the fact that I was making a profit over the two trades made it easier. Otherwise I wait and let it play out a bit.
Later in the day LOW came back up partly and it would have been a profitable trade. Oh well. If I knew the future...
9:31 - "I'm on this game show only once, I might as well make the most of it" -> Turns down guaranteed 6k for 50/50 shot at 10k...don't squander a lead for an all-in small chance, don't get emotional
11:14 - after losing huge, ADJUST FRAMING - don't make big ball plays to gain it all back. Breathe. Shift your goal smaller (lower position/exposure) and focus on what you have remaining; build from a solid base not a lofty one
14:30 - "House Money Effect" - taking bigger risk when playing with profits (house money/free money)
Good summary of some important points!
Spot on... great video as usual!
very helpfull...want an example in trading which relate to deal or no deal example
what an awesome channel!!! amazing!!!
The dilemma is using a trailing stop to exit your trade vs setting target prices. I have used target prices and ended up missing
out substantial profits. It is a double edge sword and you have to make a decision either way! If you made substantial profits then, it is not too bad!
all your videos are so insightful. thank you!
You're welcome, thanks for watching!
nicholas, if you know a book that deals with these kind of choices and variations, and maybe the corresponding human bases in deal no deal i'd like to know the title/author, because im sure this thing affects a lot of traders end results and mine as well
ty
that was a super entertaining video ;)
edit: i googled behavioral economics and found the books
Really great video! You should do more of these videos
Thank you sir! We definitely will.
Interesting perspective , Thanks for your hard work
No problem, thanks for watching Robert.
In the scenario when you have five cases there is only one way to guarantee a higher offer from the bank. And that is to have your own case contain the 500k. And when there is five cases left there is a 20% that the players case contains the 500k. So that means 80% of the time you are better off taking the bankers offer.
Excellent channel and video
What an amazing video. I've been trading for a very short period of time but all of this already makes sense. Thanks for the help
Oh boy, does sound so real
Great explanation, thanks.
Please link to Part 2.
I love it!. Now I wanna go to dance although no deal is not good that moment.
so when do you exit a trade anyways?
Love this stuff. ...
Thanks :)
Great video man
Cheers Bryce, I appreciate it!
Excellent work!
Shut up and take my money!
what are the brokers do you suggest?? im new to forex.
We try to stay impartial with brokers and not recommend any specific ones. However, you should be able to find a list online of approved brokers which are regulated by the FCA (in the UK) or other major regulators. That's a good place to start. If you need an opinion on any specific brokers, send us an email at contactduomo@duomoinitiative.com
Your gold Nick.. Gold I tell you!
Would you exit a wining trading that is giving you profit and has not hit your stop loss? I personally don't think you should ever exit as long as it is giving you profit.
If there is a strong enough reason to think it’s hit a strong path of resistance and is unlikely to proceed, or if there is some additional risk event coming up.
@@Duomoinitiative Does your trading strategy methodology compatible with trading stocks?
Aw, the percentage increases. I missed that part when read your email ... doh
Would it have changed your answer?
You said scenario number 2 twice??
nice videos but put some slides or animations would be better
Hi nicholas please could you make a video on trading cryptocurencies as this is this has a big hype at the moment
Sure buddy, I'll add it to the list.
I understand that one would take the 75k in the show however I believe that if you take profits before they reach your predefined most probable level consistenly, you'll end up making less money in the long run. Nonetheless I normally move my stop loss to profit, taking into consideration my evolving risk to reward (trying to keep as much profit without reducing too much the likelihood of hitting my original target).
In my opinion, it's ok to change your target as long as it's for the right reasons. If you're moving it because you're getting worried and want to exit the trade to have something certain - that's the wrong reason.
However, not moving your target can sometimes be a mistake. Every time the price moves, the overall landscape in the market is changing. The situation and probabilities could be very different from when you entered your trade. Your target when entering is just to assess whether the trade is viable and after that point you need to keep assessing where the correct place to exit is based on the facts you have at that moment in time. That can sometimes mean having a more profitable OR a less profitable target.
JibasJr and you're right. i've run a lot of simulations with a random walk model that showed me conclusively that taking partial profits is one of the great pitfalls you can step into. remember "lett your winners ride and cut your losses short". most traders don't know how to implement this gold advice and thats why they're never profitabel. but the solution is simple: place a trailing stop. i don't use take profits.
I really working on a demo few years now , now im realy confident with my system after many years of testing,my only problem now how i can find a reliable broker,pls help me on this matter
WOW my answer is there! You understanded that, despite of my poor english!
(OoO)
Of course, it was a great answer :)
I'd take the 50k at the start of round 5 tbf
Interesting...
It could be said the player lost nothing and had nothing at risk.
i enjoyed the story
Shit, you described me :-/ I really need to stop this, I’ve made profit trading but just trying to get that extra bit of money puts me in an ugly spot.
Its very interesting video 😅😅😅😅😅
haha good fun that video
Smart as fuck killer content
I would of taken the €52,000
DUDE YOU ARE SO COOL
how was susan very very lucky if it was 50/50
Because she won 50.000 extra. She increased her profit with 1/5 instead of losing 1/5.
2020 🤘🏾📊🇿🇦
deal
Deal or No Deal 😂😂😂