Was talking about pyramiding. Among all the backtest I have run Adding contracts increased drawdown. I am not sure what you are talking about
Presidential Election The market is moving. ES, RTY, btc, gold, copper, Eur, Gbp, ZN .... just moved a few minutes ago. And that is the very first movement / wave. Day traders from around the whole world will be very very busy over the next few days/weeks. Day Traders from around the whole world, Make tons and tons of hay while the sun shines!!! Glue yourself to the trading chair. Glue your eyes to the computer screen. Have all your trading ladders displayed properly and armed. And your fingers should be on the computer mouse and ready to click in a mini-second. I can sense all the brokers are having smiling faces. Next second movement / wave, please.
I figured you wouldn’t. Your backtested strategy had a larger drawdown with more contracts because you added risk.
You did not. Leverage allows a system with lower return/lower volatility to have a higher return than a system with higher return/higher volatility. More contracts =/= More risk. The way you tested pyramiding added risk.
Higher returns it depends. How do you leverage a system with lower return / volatility ? By adding contract ? Risk ? Dude … the more you leverage a system. The more exposed to its ups & downs. You are magnifying both the risk and the reward, In a similar fashion and proportion. If a system has a 10%DD / 10% return And you’re ok for 20% DD Then you double down. There’s no magic.
It doesn’t depend. You made an incorrect comment that you can’t increase return without increasing risk…that’s false. I commented because people overlook that fact and it’s something to think about. Get worked up all you want, it won’t change the math.