Kelly Criterion & Risk Of Ruin As Risk Management Tool

So if you have two losing trades in succession your account will be wiped away. You would not be able to put up a third trade. It is up to you to define whether you consider this too aggressive.

 

Not really.
Assume my capital is $10000, the first loss cut it to $5000, the second loss cut it to $2500.
After 10 consecutive loss , I still have $ 10 in my account.
Since my win rate is 90%,10 consecutive loss seems nearly impossible.
This is all my considerations when I set my leverage level.

 

@Baron @Magna you should not allow people like this to ruin your site reputation.

ET used to be my favourite place to learn. Aaron Brown, just joined us and I think he can bring a lot of good rep to the community. If we can implement something to clean up ET a bit, that would be great. Maybe a downvote button like stack overflow. If a poster gets x amount of down votes, they are banned for x amount of days.

I have noticed an increase in idiotic posts/posters. The option forum has completely dried up and it seems like @destriero is the only person trying to keep people in check.

Thanks

 

yep many trolls.
after his 1st lost, he's ready to dispose his account.

 

You said you come to this forum to learn, but you don't look like a learner but a China government agent to do censorship. What does freedom of speech mean to you?

 

This strategy used to work for euro, Japanese yen, gold, 10 years notes, but after trade war began, it is not working for gold,Japanese yen,but still working for 10 years note, and less accurate for euro.
It is a multi days strategy and I can show how it works in my thread.
It tries to catch a bottom or top,when signal occurs, there would be a stop outside bottom or top, then market would run to the other direction.The distance it runs is usually 3 to 6 times of the distance between where the signal occurs and stop.The whole process last for 2 to 3 weeks.
I can show this strategy in real time in my thread.
I currently have a signal occurred on euro on this Wednesday,which says euro would have a continuation rally to the upside.But the ratio between distance it will run vs distance between signal and stop, may not be so high because euro bounced too high already,and euro is in major down trend.
Also, a surprise move by authorities such as Fed would invalidate the signal.

 

ur win rate 90% but STOP hit 9 out of 10 times ??
Are u high on something ???

 

It was a typo.
I meant stop hit 1 out of 10.
Thanks for correction.

I guess putting 50% of my capital at risk is roughly equal to 1|2 Kelly but am not sure.

 

again I think this is also typo "Winning amount is 6 times of loss amount"
should be opposite.

 

I was correct on that.
Note I said this is a bottom|top catching strategy,so the distance it runs(representing profit), is 3 to 6 times the distance between where the signal occurs and stop(representing the loss incurred).
A signal at the same direction as major trend runs longer in distance than a signal against major trend.

This is also one of the reasons I dare to risk 50% of my capital.Because I profit 3 to 6 times more than my loss.