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Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

theguardian.com

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Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#251

Post by baobabKoodaa »

hervature wrote: post #103
Lapsa wrote: post #41

Earlier quoted context omitted.

I've never understood how stop losses are supposed to help. Traders read heaps of news, do God knows what technical analysis yet simple "moves bit too much in wrong direction" is supposed to be an acceptable exit strategy.

You're missing the bit that "moves bit too much in wrong direction" is a strong signal that your analysis is fundamentally flawed. Maybe catastrophic news came out since you bought in.

Even if you decide you need to exit, why do you think you will get the best possible price for your exit with a market order? (which is what a stop loss essentially is)

There are other ways to exit a position.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#252

Post by baobabKoodaa »

bmitc wrote: post #188
Lapsa wrote: post #41

Earlier quoted context omitted.

I've never understood how stop losses are supposed to help. Traders read heaps of news, do God knows what technical analysis yet simple "moves bit too much in wrong direction" is supposed to be an acceptable exit strategy.

But the phrase “cutting your losses” has application does not? A stop loss could be set at a threshold that isn’t so tight to lose money on normal variations, low enough if it’s acceptable to take the loss and and capture and deploy the capital elsewhere, and not too low to never be triggered.

> But the phrase “cutting your losses” has application does not?

A "stop loss" does not mean the same thing as "exiting a position to cut your losses". There are other ways to exit a position. If you have a large position, then exiting via market order (which is what a stop loss does) is going to give the worst possible price for your exit.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#253

Post by Gustomaximus »

baobabKoodaa wrote: post #250
Gustomaximus wrote: post #93

Earlier quoted context omitted.

It's about recovery. A loss of 10 percent necessitates an 11 percent gain to recover. Increase that loss to 25 percent and it takes a 33 percent gain to get back to break-even. A 50 percent loss requires a 100 percent gain to recover and an 80 percent loss necessitates 500 percent in gains to get back to where the investment value started.

That doesn't answer the question or relate to the topic at all.

That doesn't relate to not understanding how stop losses help?

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#254

Post by dragonwriter »

anigbrowl wrote: post #168
antonvs wrote: post #37

Earlier quoted context omitted.

“Queen of wallstreetbets” is (presumably) not a compliment, it’s a reference to the idiots on the subreddit of that name, notorious for their irrational support of companies like Gamestop, and completely disconnected from any actual understanding of market behavior.

disconnected from any actual understanding of market behavior Kind of assumes markets yield truth when left alone. It's equally true that a small but well-coordinated swarm can shape market behavior when directed at the right target, even if the swarm's activity is not correlated with anything like underlying asset value or earnings. I am not a fan of WallStreetBets but I don't think of them as idiots; more that they…

> Kind of assumes markets yield truth when left alone.

Which is silly, markets don’t exist when left alone.

Re: Caroline Ellison, CEO of Alameda Research, pleads guilty to seven offences

#255

Post by riffraff »

HWR_14 wrote: post #246
riffraff wrote: post #238

Earlier quoted context omitted.

The strong and risky assumption here is that tether actually received money and put it in some paper. But what many believe is that tether received crypto from the big exchanges and put it in crypto stuff that yields more crypto, so the billions of circulating tether is not backed by billions of Treasury bills or Chinese real estate: they are for a significant part backed by various tokens which have probably gone to…

Ah, that is an entirely different kettle of fish. So why would people use Tether as opposed to Coinbase's stablecoin?

well, cause they allowed the aforementioned crypto-as-if-it-was-USD scheme.
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