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#1
11-16-2007, 03:31 PM
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Member
Join Date: Jun 2007
Posts: 63
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Martingale and money management
I was reading about the martingale system as applied to roulette and was wondering if anybody has ever made a trading money management system out of it. Martingale seems to be working good on paper.
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#2
11-16-2007, 05:15 PM
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Senior Member
Join Date: Jun 2007
Posts: 109
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yes. Larry Williams used it for several years in his futures trading.
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#3
11-16-2007, 05:50 PM
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Super Moderator
Join Date: Oct 2007
Posts: 621
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Nothing is more difficult than the art of maneuvering for advantageous positions. - Sun-Tzu Trade with the trend, Ride winners, Cut losers, Keep bets small, Use Stops - Old School | |
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#4
11-16-2007, 08:52 PM
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Junior Member
Join Date: Jun 2007
Posts: 21
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what's a martingale exactly and how does it work?
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#5
11-19-2007, 11:36 AM
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founder of Trading-Lab
Join Date: May 2007
Location: New York, NY
Posts: 296
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martingale was born as a betting system. Basically, the strategy requires that the gambler doubles his bets every time he has a loss. This goes on until he, eventually, has a win. Apparently, this strategy seems to work for people who have unlimited funds to wager. in practice, it does not work as if you incur into a particularly unlucky losing streak, you will soon end up betting exponentially high sums of money. in addition, all casinos do have betting limits nowadays.
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#6
11-27-2007, 06:12 PM
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Member
Join Date: Jun 2007
Posts: 63
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so what do you think about this martingale system? would you apply it to your own trading?
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#7
11-27-2007, 07:19 PM
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Super Moderator
Join Date: Oct 2007
Posts: 621
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Here is what one trader (one of the most successful) has said about the Martingale system....
..."The Martingale system is a method for doubling-up on losing bets. In case the doubled bet loses, the method re-doubles and so on. This method is like trying to take nickels from in front of a steam roller. Eventually, one losing streak flattens the account." I would have to agree
__________________
Nothing is more difficult than the art of maneuvering for advantageous positions. - Sun-Tzu Trade with the trend, Ride winners, Cut losers, Keep bets small, Use Stops - Old School | |
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#8
11-28-2007, 12:05 PM
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founder of Trading-Lab
Join Date: May 2007
Location: New York, NY
Posts: 296
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Leth is right. As mentioned in my previous post, the Martingale was born as a betting system which would double up your next bet every time you had a loss. You don't have to be a rocket scientist to understand the risks involved here.
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#9
11-29-2007, 04:38 PM
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Member
Join Date: Jun 2007
Posts: 63
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Quote:
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#10
11-29-2007, 05:14 PM
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Super Moderator
Join Date: Oct 2007
Posts: 621
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Ed Seykota
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Nothing is more difficult than the art of maneuvering for advantageous positions. - Sun-Tzu Trade with the trend, Ride winners, Cut losers, Keep bets small, Use Stops - Old School | |
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