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What's a good batting avg?
for daytrading stock in US markets?
I read a lot about limiting losses and maximizing gains due to the tendency for common patterns to fail "frequently".
What is considered a good ratio of winning to losing trades? 1:2? 1:3? 1:10?
Obviously the absolute value of each trade is going to determine whether i'm + or - at the end of the day. but is this like baseball where even the hall of famers fail more often than not? Again, by fail i just mean picking a winning trade or losing one.
Winning % doesn't mean much without profit factor.
I've maintained around 60% for the last 2 years with a 1.7 Profit factor on 700 trades.
My hold time ranges from 1hour to 4 weeks. Just depends on the time frame I entered.
I trade 1hr, 4hr, daily, and weekly charts. Most of my trades are on the 1hr and 4hr time frames.
Been using the same strategy for 4 years. The difference between the first 2 and the last 2
was my psyche.
I'm still just paper trading and trying to do much more than i normally would. I'm thinking this has me in trades that i probably wouldn't pull the trigger on if it were my $s on the line. It's getting much more proficient at the technical analysis and decision making process, but it's not helping my bottom line. Nor is it helping my pschye
The strategy by and large has been the same for 4 years.
The positive difference in P/L between the years has come from the psyche
As others have already mentioned, batting average (win percentage) is really not very important. In fact in my opinion the only place where win % makes things easier is in our minds. It's nice to be right a lot. Who wants to do anything in life and be wrong most of the time? However in trading you really need to get use to being wrong a lot.
This is possibly one of the hardest things to do in trading. Being ok with being wrong A LOT and having the mental fortitude to continue trading your method correctly. When you've had 5 straight losing trades in a row, it's extremely hard to put that next trade on and manage it correctly. But that is exactly what is required.
From what i've observed, a high winning percentage is the goal of inexperienced traders. A high R:R is the goal of experienced traders. To make the switch from focusing on being right to instead holding winners is all in the mind and involves a lot of work for most of us. The temptation to break our rules and take a quick winner to appease our natural inclinations is always there.
