Thank you for your post Mavrik1 I just ran some more tests and figured out how to reduce risk I modified the system now to emit 98% winning trades and reduce drawdown what I personally like the best about this system is that calls which will be available to my broker(s) through my action it is difficult to put it together, it is difficult to find parameters that will connect the trades in other words it will seem random to them.
Based on the little information that has been provided i did some little calculations. These calculations only give a general idea about the system because the information is far too limited. 1 trade a day means 73 trades in 3.5 months 100% profit in 3.5 months , 95% profitable trades and average profit per trade 3% gives in total 219% of profit in 3.5 months. As the final result is 100% in 3.5 months he loses 119% in 5% of his trades. So 119% divided by 3.65 trades gives an average loss per losing trade of 32.60%. So the average loss is almost the same as the DD? Sounds not logic to me. The average loss should be significant lower than the DD. Selfadjusting? Every system is selfadjusting, because with each tick the values are recalculated and will give a selfadjusted result each time for each indicator. If it is really selfadjusting it will adjust to the market conditions, your DD will be far lower than 35%, and the average profit will be far higher than 3%. I use Tradestation. I wonder how you can make a selfadjustring system in Metastock, a program that has far more limitations than Tradestation. Even in Tradestation i cannot fully automate my selfadjusting system. How did you manage to do that in metastock? Efficient selfadjusting system are , to me at least, very complex systems. I have a real selfdadjusting system: DD was reduced from over 30% to about 10% and the profit that i give back in the losing trades is less than 5% of my total profits . You give back more than 50% of your total profits. Not very selfadjusting to me. And not very performing if you need a 35% DD to make on average 3% per trade. You need on average 12 profitable trades to neutralize the DD. At that point you didn't make any profit yet. Gnome is right to be skeptical. I've already seen many miraculous systems, but none of them ever survived the stage of real trading. As it is programmed in Metastock you should be able to give the following information without giving away any secret: number of winning trades number of losing trades total profits of winning trades total losses of losing trades average trades per day max DD leverage used With this information there are people on ET (smarter than i am) who can analyze the truth and validity of the system. I'm surprised about the reaction of many posters, especially if i see how minimal the "valuable" information is that they base their opinion on. From what you shared as information it is impossible to make a valid judgement on your system.
The probability of losing 3 trades in a row with a loss rate of 5% is: .000125. Of course a number of single losses amongst few winners is also ruinous to this system but also statistically unlikely if the win/loss ratio is accurate. As far as blowing up in 3 consecutive losses (or other combinations), my suggestion would be to adjust your trade size if your capital falls below the original stake. You can also use Kelly "wagering" (half-Kelly is probably best). Joe.
Drawdown Gain to Recover 5 Percent 5.3% Gain 10 Percent 11.1% Gain 15 Percent 17.6% Gain 20 Percent 25% Gain 25 Percent 33% Gain 30 Percent 42.9% Gain 40 Percent 66.7% Gain 50 Percent 100% Gain 60 Percent 150% Gain 75 Percent 300% Gain 90 Percent 900% Gain On a 35% drawdown you'll need about 53% gain to recover @ 3% a trade we are up to 18 trades. Is this correct?
Your calculations are theoretically correct but are probably not correct in real trading. The recovery depends on the capital and the margin that is used. So the recovery goes stepwise. Example 1: account: 25000 $ margin: 5000$ number of contracts that can be traded: 5 After a 10% loss the situation is as follows: account: 22500 $ margin: 5000$ number of contracts that can be traded: 4 (because you cannot trade 4.5 contracts) So you lose 20% of the trading power with a 10% loss in your account. Example 2: account: 25000 $ margin: 10000$ number of contracts that can be traded: 2 (because you cannot trade 2.5 contracts) After a 10% loss the situation is as follows: account: 22500 $ margin: 10000$ number of contracts that can be traded: 2 (because you cannot trade 2.25 contracts) So you lose 0% of the trading power with a 10% loss in your account. You need the exact information to calculate the value of a system. So those who judge on the (almost non existing) information from the OP are no real traders as they are apparently not aware of the influence of capital, margin..... on the results of the system.
No, i don't think it is correct because the average per trade of 3% is on the position as she was taken. So the smaller position after the DD was already included in the 3% average. If you talk average he needed 12 trades to recover the loss. But problem with averages is the fact that these are averages. If he was lucky in his first trade after the DD he might have recovered it in 1 trade. If things would be very bad he perhaps needed 25 trades to recover. I think it is clear now that we need the exact data to judge the system.
Wow, for a self-proclaimed expert you show zero understanding of the most basic stuff. Given the info the OP provided, 3 consecutive losses right off the bat would leave 27.5% of the original account remaining (.65^3), and the probability of that happening is .05^3 = .000125, or .0125%. In reality the trades would probably not be independent but the probability of 3 losses in a row still wouldn't be anywhere near 17%. Now I understand why you've stuck up for Hershey in the past. And you're certainly in no position to call anyone else an idiot.
-------------------------------------------------------------------------------- Quote from Scientist: When a true genius appears in the world, you may know him by this sign, that the dunces are all in confederacy against him. ~Jonathan Swift; Thoughts on Various Subjects ~The Scientist -----------------------------------------------------------------------------
it was all a joke guys sorry moderators you can close this thread and delete it and then overwrite the server HD with department of defense overwrite standards. bye