Hi. I have been trading on simulator and made over 159 trades on 1hr tf on forex, only one instrument using only the chart. I managed to turn a starting balance of $1,000 to $5,400. I am pretty confident in my system. The results that the sim produces says that If I take 1 trade per day, I will make 28$ per day. Obviously this is not enough. 10x or 20x that would be better. So how to get 10x this? Well I thought of the different ways.: 1) If I had $10,000 or $20,000 starting balance. 2) Increase trade frequency. If I made 10 to 20 trades a day with $1K it would be same as 1 trade a day with $10K. The problem with this is that: I wouldn't have enough margin to have 10 open trades at same time. Maybe only 2 max (with 50:1 leverage, which is max in USA) So I was thinking then that if I can't have 10 open at the same time then I would have to do trades one at a time and the only way to do that would be to go to even lower time-frame. However, the problem with the lower time-frame on forex is that the spread/commission make up a more significant part of your risk and therefore ruining your R:R ratio and turning your profitable strategy unprofitable. There is no way to get rid of the spread. The exchange/broker have to make money. So cannot make my risk smaller. (I guess I can try to double my reward then. I am wondering though if doing this will turn turn the strategy unprofitable, but I have to test it. We cannot believe in things that we have not tested. I will have to test that out and see if its profitable. If it is profitable than that would be ideal situation.) But anyways, keeping the strategy/R:R the same, if my stop was 20pips and spread was 1 pip then that would be fine. But the 20pip stop setups in forex are on the bigger time-frames like 1hr. This is the problem. So I wonder if there is any product besides forex that has the spread/commision very small in comparison to the stop size? Stocks? Find volatile ones? But then I am thinking, the more volatile the product, the bigger the spread? Catch 22? Anyone trade 1min charts? I wonder how the high frequency traders make money... Maybe there is no way and I need to just accept that I need a bigger account like $20,000 to make decent wages...
Okay........... 1.. why would you have to have 10open trades ?? sure your in and out so don't need the margin ?? 2. if you can make $28 4x's per day, call it $100 per day, increase lot size won't take long to get to 10K, then 1/2 the risk call it $140 per trade x's 4 3. it's not just the spread costs, does / will your system work Live, it might look the same, but add in speed of trading, tighter SL's you could easily turn to being negative here. I trade DAX / GER30 in Forex world via FXCM, 1 pip spread till 4:45pm gmt then 2pip spread, but compared to Forex easily 4's the volatility, everything is 4x's as volatile as standard currently be aware. I'm a DAX 1Min trader, I've turned $700 into $8000 despite some stupid trades like today in about 1 year part time, I trade off a Ipad mini 3G mainly, I got as high as $10300 before I blew 3K in 30mins I want 20K for the end of the year, so here is hoping account will resume it's upward trend, nearly there!! ( Percentage wise ) It can be done, but it's not easy I've been on it for YEARS be warned, I have $1000 days which NICE, sadly I have too many bad days, but will fix it!! ( think I've put $3000 into the account in total, so +$5000 over 8 years not a good hourly rate LOL )
When you start trading a real account you will find out that sim and real trading differ a lot. Once I turned $10,000 to $50,000 in a sim account and when I used the exact same system in real trading I lost have of the money. I have not yet figured out all the factors that caused this. If I trade again on sim I will make money. But some things remain a mystery to me. Keep in mind that 159 trades on 1hr tf is a very small sample and you might have been just lucky. I'm not trying to discourage and I know there is no time to try 1,000 trades. But forex is a negative sum game due to spread and requires exceptional skill to make money, something that cannot be revealed form just 159 trades on sim account.
I'd say 159 trades is a good sample personally, although I hate H1 trading if you can do it, it's likely easier to go H1 to live trading, more time to think M1 is fast and batters your emotions more. Sim trade your method on M1 and M5 see if it works there in theory first before you think about going live account. I presume you haven't got $10,000 to play with ( the OP not you LOL ) Demo not being real is easy to kill losers, let profits run, real, fear and greed kick and ego! Forex wise GPBAUD used to trade well, made most of my profit on that, but I need big trend moves to make the spead 3pips worth it, March time it just became range bound, so had to adapt to DAX and DAX has changed how it moves twice so trying to tune method and adapt to that, trading is never every easy I'm afraid.
I will check out the dax. The trades where takin in 2 days. My SIM let's me fast forward. So I could take 1000 trades in 2 weeks.
I've heard of Sim's, but never used 1, I back test my ideas to get a feel, and I tweak frequently depending on how my trading is going, like 5 trades not 100's that way making some generally and gaining experience which is key. Defo worth a few hours, then go Live smallest lot size you can trade pretty much, then increase your lot sizes as your account goes up. I'd ramp it upto $2 - $3 per pip at $1000 pretty quickly but I'm a risk taker!
Getting rich from poor requires risking 3% making at times 10% not losing very often and repeating 10x's per day. Later on when you have 20k you can slow down.