Remember the motto for a scalper: Trade small, trade often, trade automatic. My experience tells me that it is easier to have a high winning percentage than to have a high reward/loss ratio for a scalper (at least for me). 60% winning percentage is no big deal either. The more difficulty part is to have a high reward/risk ratio, which is exactly the purpose of this thread: how to improve the reward/loss ratio for a scalper. [/B][/QUOTE] ################################## Dear Sir As stated before ,if any operator would win 60% or 600 operation from 1000 ,than optimal kelly bet by risk/reward 1:1 would 20% You can calculate end result 1.2^600 *0.8^400 for 50 tradind days . do you meet this operator ?
I risk 1 point to gain 1 or more points on the ES, depending on price action, although if price action dictates, I exit with less than 1 point.
My system is automated for 1:1 and is very robust..I am now working on the addition of trailing stop programming in accordance with my defined rules for trailing (this part will take some time). I have hit pay dirt with this system..makes all the time spent developing worth every second.
"60% winning percentage is no big deal either. The more difficulty part is to have a high reward/risk ratio, which is exactly the purpose of this thread: how to improve the reward/loss ratio for a scalper." Same here, definitely more winning trades in any string of 20. Trade 50-100 lots of ER2 or CL a day. My targets depend on what type of trade it is. The following are ER2 examples: Fading the end of a correction in a trend: these days 40- 50 pts. I have a resting order at target and every 10 seconds I lower it and within a certain time I am out win or lose. I am not concerned with breaking even. Fading the end of a move that is with the trend but quite extended: 20-30 pts. Again start with 30pt target and keep narrowing it. Sometimes I scale one or two more at the end of moves that are extended. One has to take it back if the price is not giving. Paying up if I sense continuing momentum: 20-30 pts. (lowest winning percentage) bad habit, at least on my part. Trading with the crowd. I am nervous when I go with the move. I am not using stops. It proved to be more economical not to, time wise and $ wise. Just get out if I don't feel good about it or it is getting away. I get caught occasionally but if I do it is usually a very active market and I have a chance to recover. I have concluded that the only way to improve my winning percentage is paying attention to when not to trade. Basically quiet markets should be left alone. The more hectic the better for a scalper because of participants acting in haste showing their hand. In a hectic market volume and OBV patterns work beautifully showing who is on the offensive/defensive. I started trading DAX. The commissions are low and the swings are big so one has to use a different strategy. I would not fade it but rather take continuation type trades. I have daily profit targets and I quit for the day, sometime quite early, when I exceed my average take because more often then not I'll give it back. It's not the market, it's fatique or inattention on my part. When I am ahead enough to be close to my goal I go for shorter targets to be a bit safer. I have other trading interests, swing trades in various futures and stocks and options, trades that I can check once or twice a day. I think my scalping helps me not be ovovertrading in my position type trades.
You have to optimize your methods entry or exit to increase reward to risk for a scalper without deteriorating your win to loss ratio..that is the puzzle.
xiaodre I risk 1 point to gain 1 or more points on the ES, depending on price action, although if price action dictates, I exit with less than 1 point. Very can be .But author suspect ,that in long row of operation as 1000 you can not make 60% winning operation by risk reward 1:1 If any operator can that (possibly rare exist) than from 2000$ operator can make 500 $ margin for es broadly offered (infinity offer 300$) Take risk not 20% as kelly stated ,but 10% .alsov in this case 1000 initial margin per contract 900$ stop loss 1100$ target 5$ R/T operator would make from 1000 $ 1.095^600* 0.895^400 =23860 time *1000$ if operator make 20 operation per day ,that he would need only 50 businees days to meet this result P.S. -this is only approxx calculation ,Precise related with possibility to precise divide capital,smallest spread (5$ by EN,EYM better as 12.5 by ES &) But ,if any operator knew with very great chance ,that he'S perfomance is 600 from 1000(60%) by R/R 1:1 all this conditions can be made through multiple disscussions with broker'S ,banks & Sorry ,no one can believe ,that he can make 60% in row of 1000 (without insider information)
andidate "60% winning percentage is no big deal either. The more difficulty part is to have a high reward/risk ratio, which is exactly the purpose of this thread: ################################### each winning ratio related to risk/reward and trade intensity by condition of market high liquidity in realtion to operator capital and operator traing full in consistence with law(no insider deal) By intensity 1000 operation for 3 month,year or 5 year and risk/reward 1:1 60% winning ratio is very big deal ,as you can see from example above .
Gentlemen sSrry to inform you .To date for multiple years not observed any scalping related top results. Best what was observed was 855% on capital 2982$ per month by fxcm.com trading contest . That was not the scalping .4 operations with GBP/JPY one with some 350 pips and three with some 100-130 pips each was decisive for result .
I've done a few weeks of 1-lot scalping the FESX-contract, and 60% is not very hard to achieve, even over 1000 trades. Winrate is tied directly to your entry-/exit-mechanism, and since scalping is so frequent you take 1-2 tick profits without the fear to add if the position goes slightly against you. I don't think a pro scalper worries too much about margin - you know what the requirement is but I would think most calculate the necessary equity per contract they want to put on based upon their system rather than exchange requirements. Kelly is way to aggressive. If you're unlucky with your trade sequences you'll blow up. Mathematics is never a guarantee that you won't blow up if you're unlucky. From what I've understood high frequently scalpers can often have very decent percentage return on their account, but leave their size at a level which is comfortable psychologically and which doesn't affect the book enough to move the market. Trading a few lots in crude oil is ok, but once you start putting in 15-20 lots you will start to affect the market and algorithms will try to work against you and lean on your size.
The quote about the over 60% winning percentage was from enlightenedtrader. I simply seconded it. I am not interested in backtesting my method because I am trading it every hour of the day in real time with real money in all market conditions. It has evolved over time and suits my personality. Most ET members fail to recognize that there are other levels to the game, backtesting is not the end all. An experienced scalper can change tactics, use intuition, creativity and c u n n i n g even to come out ahead in the game. Regards, GC