AMC - The Chartist

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June 2, 2021 at 8:44 am #102128

TerryDunne
Participant

My system wants me to short AMC tonight…I’ve only once since restarting not followed my system and that was to not short Gamestop. This is a decision that I have not regretted.

Thans again to the wise heads here, whose counsel I took

My question is, do you feel the same way about AMC?

Thanks in advance!

Terry

June 2, 2021 at 9:40 am #113358

Nick Radge
Keymaster

I had a great trade in AMC last week on the short side.

June 2, 2021 at 9:44 am #113361

TerryDunne
Participant

Thanks Nick!

June 2, 2021 at 8:44 pm #113362

Nick Radge
Keymaster

Not sure you’d thank me today…yowsa

June 2, 2021 at 11:22 pm #113365

TerryDunne
Participant

A bit of an early morning slap Nick, but these things happen. Somebody wise might say “…next 1,000 trades…”

However, it does reinforce my ‘issue’ with shorting…this is exactly the thing that I have been fretting about, not specifically AMC, but generally. I know I’ll lose some diversification but I’m strongly considering canning my short systems. I just don’t like the unlimited risk.

Ironically, given the discussion on my progress journal, this is much more annoying to me than the (in my opinion) much smaller risk of some huge market wide one day down move. I know there is Black Monday, but even the Flash Crash rebounded on the day.

June 3, 2021 at 4:04 am #113368

MichaelRodwell
Member

That was enough to give me heart palpitations and Im not on it.

June 3, 2021 at 8:17 am #113371

TerryDunne
Participant

I hear you. Unpleasant but not fatal.

June 3, 2021 at 10:47 pm #113369

ScottMcNab
Participant

Terry Dunne wrote:

A bit of an early morning slap Nick, but these things happen. Somebody wise might say “…next 1,000 trades…”

However, it does reinforce my ‘issue’ with shorting…this is exactly the thing that I have been fretting about, not specifically AMC, but generally. I know I’ll lose some diversification but I’m strongly considering canning my short systems. I just don’t like the unlimited risk.

Ironically, given the discussion on my progress journal, this is much more annoying to me than the (in my opinion) much smaller risk of some huge market wide one day down move. I know there is Black Monday, but even the Flash Crash rebounded on the day.

Hi Terry…is there the possibility that IB will start auto liquidating positions at the bottom of the crash before rebound ?

June 4, 2021 at 8:04 am #113374

TerryDunne
Participant

Hi Scott,

They only liquidate if I overdraw, and I haven’t even come close so far…For me to max out, I’d need 80 MOC trades to trigger and so far a huge day for me is 20 trades.

But you’ve pointed me in the right direction – if I download all of my system back tests into a spreadsheet and sort by date, I will be able to count the maximum number of trades on any one day over the 10 year period. While this won’t guarantee the future, it will be indicative, like the other aspects of back testing.

My guess is I won’t even be close, but I’ll post after I do the exercise.

June 4, 2021 at 10:52 am #113381

ScottMcNab
Participant

Cheers Terry. I have always wondered what would happen in the “Flash Crash” type of situation too when using 4x leverage…if IB algo would just start closing margin positions automatically such that then miss the bounce…i seem to vaguely remember about it checking at different times during the day..

June 4, 2021 at 11:38 am #113382

JulianCohen
Participant

I think that in that particular scenario, the drop in prices was so quick that nothing really traded. All your limit orders would be filled I would guess as soon as actual trades started again and you would make a monster amount until the NYSE decided to unwind all the trades leaving you with jack shit….except maybe for the odd trade that really went against you…they’d let you keep that one.

cynical to the last me!

June 4, 2021 at 12:06 pm #113383

TerryDunne
Participant

The most MOC trades I have on any day is 60 from a possible 80. In this situation, it would be safe to ‘pyramid’ profits until I had 50% profit.

However, this assumes that my other systems are fully invested. On this (the 60 trade) day, none of my other systems were invested at all. So it’s safe to say that pyramiding the profits for position sizing up until 50% profit would be entirely feasible – and safe – for me and my systems. However, if I wanted to ‘”pyramid conservatively”, I would not double up after I had 50% profit.

Different stretches and systems will probably mean this “pyramid conservatively” level is different for each of us…

But isn’t this ignoring the bigger risk – one that has actually happened this week rather than could have happened back in 2010? We are all making jokes about having trades that are losing 50%, 60%, up to 100%. Are we not seeing what is right in front of us?

I’m inclined to think that my position sizing methodology is much less risky – and less likely – than shorting.

June 4, 2021 at 12:53 pm #113384

JulianCohen
Participant

Well I think that even if a single trade loses 80%, it is a small fraction of the overall account…One trade really doesn’t matter in the big scheme of things.

That’s why we can laugh about it, because it really doesn’t matter that much. Tomorrow is another day

June 4, 2021 at 11:13 pm #113385

TerryDunne
Participant

Fair enough. Although it doesn’t have to be 80%, it could be 180% or 1080%. Very unlikely, but we are discussing very unlikely scenarios here.

Thanks for the interesting discussion, it’s helped me produce a proper process for my position sizing. It’s also helped me reach a decision about shorting. I now don’t have to invest any more time on these issues and can go back to trying to turn Dow Theory into a tradable system.

Good luck to everybody!

Terry

June 5, 2021 at 4:35 am #113386

JulianCohen
Participant

That’s what we are here for…everyone has to find their own path that suits them best. To me that is really half the battle of trading, finding what works for you.

Good luck with the alchemy:)
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