Chapter 1: Wider Stops in Trading

Is trading with wider stops advantageous? According to my strategies for FTSE and US500, it appears to be a promising approach.

I've been backtesting a straightforward FTSE strategy that involves buying at market open with a target take profit of 10 points and a stop loss of 30 points, trading at £75 per point. The results from my tests have shown encouraging month-by-month profits as follows:

• February: +£1,087
• March: +£1,275
• April: +£5,362.50
• May: +£2,062.50
• June: -£2,212.50
• July: +£6,525
• August: -£2,400
• September: +£8,437.50
• October: -£187.50
• November: +£4,612.50
• December: +£9,090
• January: +£5,467.50

Overall, this strategy yielded a total profit of £39,119.50 for the year. I actively traded this method during February, and the day-to-day breakdown of my results was as follows:

1 Feb: +£757.50

2 Feb: -£387.50

5 Feb: -£97.50

6 Feb: +£780

7 Feb: +£757.50

8 Feb: +£30

9 Feb: +£540

13 Feb: +£780

14 Feb: +£795

15 Feb: +£712.50

16 Feb: +£292.50

19 Feb: +£540

20 Feb: +£52.50

21 Feb: -£2,250

22 Feb: Did not trade

23 Feb: +£780

26 Feb: +£90

27 Feb: +£765

28 Feb: +£240

29 Feb: +£240

The total profit for February was +£5,417.50. Additionally, I have a similar 10/30 strategy for the US500, incorporating some extra criteria regarding pre-market fluctuations. This strategy also proved profitable for February:

23 Feb: +£597

26 Feb: Did not trade

27 Feb: -£281.25

28 Feb: +£48.75

The total for February here was +£364.50. I plan to continue paper trading my other strategies until two conditions are satisfied: my paper trades must show consistent monthly profits, and I need to complete the extensive Al Brooks trading course, which consists of over 200 hours of material—I am currently just past the halfway point.

From my fractal trades, I've recorded losses of -£752.40 and -£773.28, alongside a profit of +£1,263.15, with another ongoing silver trade currently showing +£1,260 in profits. Recently, I shorted the German DAX, resulting in a loss of £525, but I also closed a long position in the FTSE for a gain of +£577.50. This leaves me with a realized loss of -£213.18, while still holding a profit of +£1,260.

I will continue with paper trading through March, aiming to transition to live trading in April. My philosophy is that employing wider stops will enable me to remain in trades longer, maximizing potential profits; I intend to trade more reliable signals, trade less frequently, avoid chasing losses, and only explore additional strategies if I feel that price action justifies it. After a downturn in January, I seem to be regaining my footing. My trading account experienced nearly a 10% profit in February, and I hope to maintain this upward momentum in March.

TOTAL = +£60,343.74

Disclaimer: The information in this article is intended for educational purposes only and should not be construed as financial advice. Trading carries risks, and it's vital to conduct thorough research and seek professional guidance before making any investment decisions.

Chapter 2: Insights from Trading Videos

The first video titled "Tight Stops Don't Work or Do They!!?" delves into the effectiveness of tight stop-loss strategies versus wider stops, providing various perspectives that can enhance your trading approach.

In the second video, "Is Having a Wider Stop the Silver Bullet for Your Trading?" the discussion revolves around whether wider stops can be the ultimate solution for trading success, highlighting both advantages and potential pitfalls.