1:50 risk/reward ratio

Trading Systems Free Forex Trading Systems
1

i have found a way of open trades with a r:r ratio of more than 1:50.

that means if we risk 1% of our account in one trade that will give back 50% of that account in return.

3 winnings per month will double the account… counting with all the losses in the midle… that means that i´m counting with a absolute drawdown of 50% during the month…and only 2 winnings (what i think will be more)

unfortunelly this is only theory but i´ll post it any way if there´s any interest in this thread:D

PS: i´m playing tymen´s game now (make suspence and increase my nunber of posts:D)

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ok Rui Let’s hear it!

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well… is about martingdale system… but the oposite.

martingdale gamble system says that if you risk 1% and you lose it them your next risk would be 2%… and if you win that time you´ll have the 1% winning… this fails because if you lose 5 times in a row in the fifth you´ll being risking 16% plus the 15% you´d already lost 31% just to win 1%…

so martingdale´s system is a killing account system.

but the opposite may work as well as the original faills…

i mean with a good system that works in 2 TF, 1h and 15m, and that make you enter the 1h trend in the 15m retraces with a small SL, between 15 and 30, if that trade go 150 pips in one direction with only 4 retraces in the 15min, or 4enters in the trade, at the end of that trade you´ll have made 50-60% of the account with the MM í´m thinking about… without never have in the table more than 1% of the account

4

ok that´s an egsample of one of those 1:50 rr ratio trades… in 1hour TF

op means open
sl is stop loss

the number before is the order of the opening of the trades

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the white vertical lines show the entry candles in this trade.

6

Rui
I think that MM scheme is close to what I do and how I trade MMTT The reverse Martingale every little winning trade risks more. I dont put a pip stop on the individual trades in the series I use a total % lost as a stop. I can average down or take a bunch of small 2 to 10 pip trades once I have a longer time frame direction established. If I get down to my cut out I close everything. It works very well for me.

I see what you have posted is a little different from what I have been doing.

Do you keep the trades open and keep adding trades or do you cash each trade out when you open a new one? I have been closing and reopening at the next retrace with a larger trade.

What is that psar looking indicator on your chart? and how are you using it.

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ok. i really sucks in math so this is most likely to be wrong… so mike you can give me a help in this one… if you see that this is wrong tell me:p

ok. lets see this MM thing:

the first trade is open at 1.4952 and SL at 1.4933… that´s a 20 pips SL and represents 1% of the account.

the second trade is open at 1.4975 and SL at 1.4958… that´s a 20 pip SL too

now when we open the second trade we move the first SL to the second trade SL that will give us 4 pips profit from the first trade and that is 0.2% of the account… so in the secont trade we will risk 1.2% of the account.

doing that we are in the trade and we still have only 1% at risk.

the third trade is open at 1.4995 and SL at 1.4984… that´s a 15 pip SL
at this point we move the first and second trade´s SL to the new trade SL. and that will give us 32pips from the first trade and 10 pips from the second.
at this point we have 1.5% profit from the first trade + 0.42% from the second trade + 1% of the original risk. so in the 3th trade we will risk 2.92% of the account and we still have only 1% at risk.

the 4th trade is open at 1.5066 and SL at 1.5051… that´s a 17 pips SL.
at this point we move the 1st, 2nd and 3th trade`s SL to the new trade SL. and that will give us 100 pips from the 1st trade, 75 from the 2nd, and 55 from the 3th… that means 5% from the first trade, 4,5% from the 2nd and 9.3% from the 3th… so in the 4th trade we will risk 5% + 4.5% + 9.3% + 1%= 19.8% of the account and still have only 1% at risk.

now we close all the trades at 1.5100 and that will give:
1st trade: 150pips and 7.5% profit
2st trade: 125 pips and 7.5% profit
3th trade: 105 pips and 20.44% profit
4th trade 34 pips and 45.54 % profit

that makes a total of 80.98% reward from a initial and constant 1% risk.

if we set a rule that we will close the trade any time if it reach 100% profit, in this trade that would happen a couple hours earlier.

so this can seem a very crazy idea, but this kind of moves happen 4-5 times per month, and even a smaller move would easly give a reward of more than 15%.

the only problem is be able to stand in front of the screen 24 hours a day 5 days a week:D

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so lets supose we are robots that don´t need to sleep and we can stand in the screen all day every days.

we catch 3 of those perfect trades in a month. all the minors winners trades we will use to pay the all the 1% losses.

so in one month trading only one pair we would double the account 3 times or in percentage we would made 800% gain in one month.

is so good to be able to dream so high :D:D
and is so bad that i always need to awake up and go to work:p

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Hi ruilima22

So what is your entry & exit rules?

Thank,
Simon

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Only problem is that currencies only trend 30% of the time. The other 70% is ranging market. Parabolic SAR trades will get KILLED in a ranging market (and they redraw like crazy in ranges)

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this is not about the system, is about the money management.

and is not practicable is only theory… you guys are always with the stones in your´s hands :stuck_out_tongue:

12

this is called pyramiding, be aware that 20 pip sl will be too tight most of the time at the second stage itself price will retraced and you will get stopped out for a total loss of 1% on the account.

if u have the patience to take small loss after loss then u probably will catch the big winner sometime … but its hard to do.

as far as the system is concerned take a look at the andrew forex system over at ff its perfect for this type of pyramiding with well defined rules to add to positions which are in profit.

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Pyramiding is what I am learning with naked trend trading; that’s the best money management strategy for longer term success. However, the most reliable trends to follow are on the 4-hour charts and higher – and they require more than 50 pips in stops, it seems.