Here you have two sources of Monte Carlo Simulations on custom Equity Curve statistics: https://ayondo.com/en/tools/equity-curve-simulator https://due-diligence-hub.com/en/tools/equity_curve_simulator
Monte Carlo simulation in Excel. The dotted arrow is your expectancy and the other series are simulations ran based on those probabilities. I'm sure there are better platforms that will generate it for you online these days. Any trader that's trading for profit needs to understand the equation of expectancy and what's required depending on which realm you operate in.
I think risk of ruin calculation is the formula you need to define your edge. It pretty much covers all the metrics you need from EV, w/l %, pf, max risk.. just overall good summary into your system.
You study the market and find something that you can exploit for a probable profit. ..................... 55% of the time you have an edge. If you bet on the direction a stock will go, cut your losses quickly and let your winners run, you have an edge.[/QUOTE] [QUOTE="deaddog, post: 5815471, member: .... %% Good points but its not really a gambler s bet.................................... Edge differs also in farming / finance; farmers like to track hoe\ bull doze down edge; too much shade on crops
Based on my account since 2/20/23 using 20k account and risking 80% (margin call) Somebody check my calculation but my risk of ruin (margin call) is nearly zero? What am I missing? at 20% loss, it's still < 1% risk of ruin
This is awesome! Thanks for the links, its really helpful for somebody who is a rookie trying to get into the quantitative numbers without having any real coding or math background.
Another question for you. I don't have any experience in coding or backtesting. Do you know if any sites similar to this where I can do some simple backtesting?
Yes, it is all mentioned here on this website: https://quantpedia.com/links-tools/?category=backtesting-software Some are based on websites with clouding and no coding, others you need software but also with no coding here are offered too. Just scroll through and have a look which offers are most interesting for you as I do not know your custom requirements. This website has good overview what exists in the total backtesting market. It is really comprehensive. All you need is here.
Counter-intuitively, beginner’s would do better by focusing on lower winrate/higher r:r strategies. 1) It builds the skill of patience and discipline via making one more selective in trades. 2) It causes one to focus more on HTF’s 3) It’s more forgiving and easier to scale. High winrate/low r:r demands high frequency/high performance and has a higher probability of leading to blowout/burnout.. Ymmv