Simon.. An experiment!

[john_1]

We all know we take losses slowly and winners off the table to soon. I am wondering if the source of the problem is that all trades start off negative and as such we unconsiously recognize we have to sit through a perriod of loss before we can realize some gains. The longer it takes to break even the stronger the desire to snatch any percieved gains......I have been giving this a little thought and I would like to conduct a trading experiment. Select active traders and on entering a trade "give" them a possitive balence of R100 instead of the normal negative spread... any losses beyond the R100 are for thier account and any gains above R200 are also for their account and see what happens......I think they will cut losses before their R100 bucks is up and will let the green numbers grow....What do you think?

[john_1]

I also think spread betting platforms know this...thats why they are happy to let people trade naked and unhedge positions as most take profits quickly and let losses run...they are in fact getting paid to trade in exactly this way. prehaps their hegdes kick in as you go into profit....

[#3]

Sounds good

[SimonPB]

yip .. if the majority of traders loose money then as a trading house, don;t bother to hedge and make profits that wahy .. always the Q if trades are really being hedged ..

your idea, liek it .. but bossess will be laughing until after my month long break ..

[saash]

I go with your theory

[john_1]

I dont suggest it for everybody. Select 20 active reasonably competent traders who show a tendency to cut winners..price the spread and your risk accordingly...and see what happens.. whats the worst thing you do...infact why dont you commit x amount of your unspent marketing budget because word of mouth of a broker that actually did good..that got to have value.