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Defense is Better than Attack in Trading

Discussion in 'Forex Discussions' started by Currency Expert, Sep 28, 2014.

  1. Currency Expert

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    “Defensive strategic trading clearly is more successful in the long run than you might think! There will always be people who briefly achieve huge returns using daring maneuvers, but in the long term the strategist with an approach based on sound statistics will be successful…”

    When an advancing army anticipates attack, they tend to prepare themselves so that they can fend off the attack successfully. When a state of war seems hopeless, an intelligent and experienced general would tell his army to wait and let the enemy attack first, while they prepare for the attack. Defense is better than attack. In football, when a team is too desperate to score goals at all costs, their defense may be unknowingly put in disarray and this may enable the opposing team to utilize the sudden weakness and score a goal, thereby frustrating the team’s effort.

    The same is true of trading, because the most important goal is not to lose our money. When we achieve the goal, there would be times when profits would come normally. We not need to bury our heads in the sand, ignoring reality. We would need to come to grips with the fact that we may not survive the markets permanently until we learn how to deal with the uncertainty of the markets. The way risk is handled clearly differentiates between a market veteran and a novice. A market veteran does not react negatively during a loss; whereas a novice does. A veteran waits for another trade after some negativity – she/he does not overreact when there is loss.

    If we feel that all our trades will be profitable, we might later be surprised that we are not right. The market does not ask for our approval before it turns against us. The fly does not ask for our permission before it perches on us. Negativity happens in all ventures. The ultimate action we can take is to tame the risk and not gamble our funds away – as many traders do.

    The quote above is from Rene Wolfram. The quote below is also from him, (based on his interview in Tradersonline-mag.com, September 2014). The quote below ends this article:

    “Most traders think topics like mental coaching or risk management are boring, but that’s exactly where the problem is: These things are the most important ones in trading. And there’s another problem: Many traders know trading approaches that work but are simply incapable of implementing them on a regular basis.”

    Source: www.tallinex.com
     
  2. vic84

    vic84 New Member

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    You have to be very versatile in the market and should trade according to the market situation, you cant be defensive or attacking every time.
     
  3. orni308

    orni308 New Member

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    The very decision of how to trade depends on the client himself and what strategy he uses also depends on his past experience and personality.
     
  4. somefxtrader

    somefxtrader New Member

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    it's all depend on trader needs and should match with their current trading method used. personally I use most popular method, scalping strategy. The fundamental characteristics of a great Forex broker for scalping are : The spread must be low; which is a vital variable in choosing a broker for scalping. has a quick execution of requests so we able to trade more requests in only one second. got mine with Tickmill ECN account type, which fully satisfies it all. high execution process supported by numerous liqudity provider they use. Low cost trading fee, with 0.3 pips average on EURUSD trade, I've got smaller spread during volatile market event, and they had no restriction for any kind trading strategy use.
     
  5. sininfinity

    sininfinity Active Member

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    I think it varies from trader to trader. A defensive strategy which is profitable for one method may not be so profitable for another method. So it is subjective. Personally I will go for stable strategy where profit will grow slowly with high expectancy.
     
  6. SurtiTrader

    SurtiTrader New Member

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    Very well said I absolutely agree with you. Defensive trading is the best way to make money with Forex. I do have similar strategy
     
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