iCharts Discussions

[worsttrader]

Partial booking is something many traders do to cut their losses thinking it will increase their profitability. However, mathematically, partial booking will usually end up in depleting your profits. here is an excel worksheet with different system accuracy percentages which clearly show that it is better to book full profits under EVERY circumstance. I hope it helps a few people.

[rrk2006hyd]

[worsttrader]

I added a few scenarios where partial profit booking worked and converted losses to profits. even then it is clear that unless your system itself is bad, there is no advantage to booking partial profits.

[worsttrader]

[worsttrader]

[druzva]

Vijay Bhai if you see SB people keep booking whole day. Left right and center. Joke apart positive expectancy also depends upon from a trading style . Say for example if you trade Intra day partial booking at 1:2 risk reward and trailing balance will give positive ledger . But if you trade positional or swing partial booking with similar risk reward may not work. We need higher risk reward. as you have to factor potential gaps against your trend. 1:4 for can be ideal for part booking. But if you are a "JIGARA" and can hold completely from pivot to pivot . It will also work but you need to be mentally strong. In practice it does trouble. Runy

[marimuthu13]

very basic thing which missing is revisiting SL after after partial booking..

if i have 2 tgt., booked half at 1st tgt then i would revisit sl to cost to cost and waiting for 2nd tgt for remaining possiton..

[ndpotade]

[pkholla]

Vijay:
1) You have probably only considered trades that have moved on to target. Many trades reverse after partially going towards target. What about them? Should we wait for CMP to reverse completely and hit SL?
2) Bill Wolfe , originator of WW theory, clearly states that if the CMP has reached a point where you are satisfied with the profit generated, then you can book partly or completely just TO BE SAFE, RATHER THAN SORRY instead of waiting for the theoretical target
3) It is very easy to do POST MORTEM of completed moves and say dont book partly but when faced with a share that is WAVERING and threatening to reverse I would rather book and exit esp if it has covered , say, 60% of the way.
As Umesh1 originator of Gann thread says, another day, another trade are always ahead of you! See Umesh's rules: book 50% at first tgt, 25% at 2nd tgt and fully at 3rd tgt
Cheers, Prakash Holla

[taruj]

Vijay,

I wish I had this amount of knowledge to answer or to ask questions. And I have not done the math behind all of this. Some basic thing that I believe, may be completely messed up however it has been my experience that
-
Risk/Reward is obvious/confirmed after the trade is done. The idea behind reward is somewhat like this. I have risked 100 Rs to make 200 Rs. now Do I KNOW that I will get 200 rs? if yes, then no SL is required. I put SL as I dont know I will get 200 rs. so what remains? I can sit and wait for getting 200 or exit "somewhat" at 150, 180, 120 somewhere where i am comfortable. - I have a rule around this, that has helped me. Infact I might book completely at a price that may not be giving me a 1:2 RR.

Markets are uncertain. Max profits aside, even profits are uncertain.

Hence I don't even think I will be able to ask the questions that i thought I will be able to ask .

Regards,
Taruj

[worsttrader]

[amitagg]

2 points:

- "time horizon" of trade is also important....depending on what time frame chafrts we trade , if we have or should have a time horizon of trade from initiation, then "full profit booking" can and should be done based on this....as often said, we to price studies but time studies are important to further understand the trade position

- also, as we get more and more adept and able to trade "shorter time frames", then "full profit booking" can be done [since the longer trend may be different....] -though on probability we should trade when multiple trends are in our favour

it is quite possible that i am wrong.....

[taruj]

[Atrader]

There is old axiom in trading world

" CUT YOUR LOSERS and LET THE WINNERS RUN"

I think profit booking depends on position sizing, how much you have on the line. Because with large position sizing it is better to get to break even as early as possible otherwise objectiveness of mind will get lost in due course if trade goes in wrong direction.

Every trader should have definite strategy for exit and he/she must follow the same because in long run. As disciplined trader will always get rewarded.

Humans are greedy by nature and also fearful but the set of rules will keep these emotions out of equation and make the ride smooth.

With small positions it is possible to ride the move all along.


So it depends on each individual how they going do it