Would a Time Stop Have Helped? Test It on a Table
Posted: Wed Oct 28, 2026 6:51 pm
Would a Time Stop Have Helped? Test It on a Table
Over 40 trades, a trader notes how long each took to resolve. Of 20 winners, 18 reached their target within 10 candles, and 2 took longer. Of 20 losers, 8 were stopped within 10 candles, and 12 stayed open longer before stopping. Rule under test: if a trade has not reached plus 0.5R after 10 candles, close it at market.
Isolate the trades open past 10 candles: 2 winners and 12 losers, 14 trades in total. Suppose the 2 winners earned plus 2R each, for plus 4R, and the 12 losers each lost the full 1R, for minus 12R. The net on that group is minus 8R.
Under the time stop, the winners would have been closed early, and the losers too. Assume the market-close exit is at minus 0.3R on average for the 12 losers: minus 3.6R. For the winners, assume that at 10 candles they were not yet above 0.5R, so they would be closed at around zero: 0R. The net on the group becomes minus 3.6R.
Improvement: from minus 8R to minus 3.6R, a gain of 4.4R, which is about 0.11R per trade across all 40.
Caveats: the assumed exit values matter, and the sample is small. Also the winners that were cut would have been the best performers, a cost to count.
If the benefit survives different assumptions, the time stop is worth considering.
Exercise: record the duration of every trade for a month and test a time stop at the 75th percentile of winners.
Over 40 trades, a trader notes how long each took to resolve. Of 20 winners, 18 reached their target within 10 candles, and 2 took longer. Of 20 losers, 8 were stopped within 10 candles, and 12 stayed open longer before stopping. Rule under test: if a trade has not reached plus 0.5R after 10 candles, close it at market.
Isolate the trades open past 10 candles: 2 winners and 12 losers, 14 trades in total. Suppose the 2 winners earned plus 2R each, for plus 4R, and the 12 losers each lost the full 1R, for minus 12R. The net on that group is minus 8R.
Under the time stop, the winners would have been closed early, and the losers too. Assume the market-close exit is at minus 0.3R on average for the 12 losers: minus 3.6R. For the winners, assume that at 10 candles they were not yet above 0.5R, so they would be closed at around zero: 0R. The net on the group becomes minus 3.6R.
Improvement: from minus 8R to minus 3.6R, a gain of 4.4R, which is about 0.11R per trade across all 40.
Caveats: the assumed exit values matter, and the sample is small. Also the winners that were cut would have been the best performers, a cost to count.
If the benefit survives different assumptions, the time stop is worth considering.
Exercise: record the duration of every trade for a month and test a time stop at the 75th percentile of winners.