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firewalker

Bad Beat in Trading?

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I'm not sure if there is such a thing...

 

In poker there's always the element of chance. In trading I think there is less. If one is highly capable of analyzing the buying and selling flow in the market, he will be aware when a turn is imminent. In poker, even if you have a very good idea of what the other players have in their hands, and even if you know all the odds by heart, the river card might still give the other player a highly unlikely - but yet possible - victory.

 

Suppose you have a pair of kings with nothing on the table but a series of unsuited low cards. The best anyone can make is a pair. But then comes the final card and it's a low 5 making a pair of 5's on the table. The only player who was still calling your bets, now has a three of a kind.

 

In the markets, the only form of 'bad beat' I can think of, is a totally unexpected, unscheduled, unannounced news report. 9/11 comes to mind...

 

Any thoughts?

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Right w/ you again FW. Other than an UNEXPECTED news announcement, I don't think there are bad beats in trading either. I say unexpected b/c FOMC does not catch you off guard. Regular 10am news does not catch you off guard.

 

Like you said, you cannot be rivered in the markets. You are either 100% correct or 100% wrong.

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I think you also need to consider bad beats when the exchanges goes down. CBOT has gone down a number of times in the past... luckily for me everytime i was in a position I happened to be on the right side. But opening up close to 70pts on the YM... there are traders who lost that much from such technical issues.

 

Your PC crashing is another example. My PC one time broke down while in a position... I was down $3,000 before I could do anything about it.

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Didn't think that of James, good ideas.

 

Luckily the CME has been very solid, so no complaints there.

 

If your own PC goes down, you need to have a plan B. For me, that is having OEC on speed dial, straight to the trade desk. If it's an internet issue, I have a backup Verizon wireless aircard that I can switch over to if need be.

 

It's also important to know how orders reside - either your computer of the brokers. Example - when I place a bracket order on OEC, I know the others reside on their side so even if my computer goes down, at least my stop and profit orders are there. I can't manage the position, but at the minimum, a protective stop and target are out there.

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