Painting the Tape – Episode 4: All About Trade Management PT:2

Hosts: Leo, Stowe, AJ

[00:00] Introduction & Banter
Meet the hosts as they catch up on life, discuss Memorial Day weekend plans, and share some lighthearted stories about family and trading routines.

[03:10] Episode Theme Introduction
The hosts introduce the main topic: the controversial use of stops in trading, and set the stage for a deep dive into risk management.

[04:30] Personal Trading Journeys
AJ and Stowe share their early trading experiences, mistakes with stop usage, and how their approach to risk evolved over time.

[08:30] The Psychology of Stops
Discussion on the mental challenges of using stops, the temptation to widen them, and the importance of objectivity after being stopped out.

[11:00] Stop Strategies & Tactics
The group details their default stop sizes, how they adjust stops based on market conditions, and the difference between tactical and emotional stop adjustments.

[18:00] Widening and Tightening Stops
When (if ever) it makes sense to widen a stop, the dangers of “hopeful” stop moves, and the rare scenarios where tightening stops is appropriate.

[24:00] Putting Stops in Profit
A debate on moving stops to break even or into profit, the difference between tactical and fear-based decisions, and how this fits into different trading styles.

[34:00] Adapting to Changing Market Environments
Leo and AJ discuss how they adjust their strategies for low vs. high volume days, including sizing, stop placement, and the mental toll of slow markets.

[45:00] Experimenting with New Approaches
AJ shares his recent experiments with tight-risk scalping in low-volume environments, the challenges of adapting, and the importance of reviewing and evolving strategies.

[49:45] Trade Management Wrap-Up
The hosts reflect on lessons learned, the ongoing process of adaptation, and the value of honest self-assessment in trading.

[51:00] Closing Thoughts & Listener Appreciation
Final thoughts, a thank you to listeners, and a preview of future episodes.