Good question. My stops are based around a max MAE. On the whole, the best trades will not experience much of a drawdown. Thus I am stopping out when they go beyond that threshold. Some playbook stops will be tighter than others. On the whole, you want to be stopping out when your trade idea is clearly invalidated
Hi Austin, you would be aware that PLS has a shortbase of around 21% - does this factor into your thinking either in deciding to trade or how you manage the trade once in?
Austin, thanks for sharing, really appreciate the detail! The MAE was 1% - was your plan to simply cut the entire position at a particular loss (2%, etc.)? Or, would you have reduced it more gradually? You held your conviction and it didn't go much against you, but had it continued to run higher, what would you have done?
Good question. My stops are based around a max MAE. On the whole, the best trades will not experience much of a drawdown. Thus I am stopping out when they go beyond that threshold. Some playbook stops will be tighter than others. On the whole, you want to be stopping out when your trade idea is clearly invalidated
Hi Austin, you would be aware that PLS has a shortbase of around 21% - does this factor into your thinking either in deciding to trade or how you manage the trade once in?
Austin, thanks for sharing, really appreciate the detail! The MAE was 1% - was your plan to simply cut the entire position at a particular loss (2%, etc.)? Or, would you have reduced it more gradually? You held your conviction and it didn't go much against you, but had it continued to run higher, what would you have done?