Surewin88 has an average open trades of 4 days but sometimes this will be longer. I always let the market dictate whether a trade is closed in profit or loss. As we are using a STOP LOSS we know that each trade we take we are risking a set amount.
You selected an 8 % risk. If each of your trades reached it’s stop loss then you would lose 8% of your trading account. If you have 4 open trades that hit their stops and you would have lost 24% of your account. This is the trade off between making more money in the long run and our emotional reaction to the higher draw-down.
The way I deal with a draw-down is to change my lot size each day depend on the [B]risk[/B] I am taking and the [B]floating balance[/B] in my trading account.
Example
5% risk in $10,000 account.
If the account gets into a draw-down I change my lot size.
$8,500 floating balance with trades open. I work out my 5% risk to the $8,500 to get my daily lot sizes. This also minimizes my risk of a margin call.
I do this each trading day. (Takes less than 5 minutes with the calculators I use)
In this way I do not worry about what the market is doing. All I do is keep my system on track.
Risk management should be carried in all financial markets and I like your style. However, sustaining a loss of over 2,000 pips in 8 open trades is reckless. Stops are way too high if you compare them to the booked profits.
Money wise, if the frequency of the trades are more than 7 per week, use 0.5% per trade. Emotionally wise, only risk that no matter what happens, win or loss, you are not emotionally attached to it.
fxturtle, how about being non-emotionally attached to my equity, and then seeing an SP draining it little by little, or with one swept, is not the best experience like ever ;(
That is when common sense comes in. If the SP is slowly killing your account, you’ll have to set a limit how much an SP can do damage before you let go of him/her.
If im a follower and risking 0.5% per trade, a loss of 10% of my equity would mean time to drop the SP. Also, I will follow for a longer time period as long as the equity loss does not exceed 10%.
I observed from forum everywhere that they’ll test the SP for a week and if it does not work out, they’ll drop, but one week is not indicative of what an SP can do over the longer term. This is the reason why I would like those people who would like to follow me in ZT to test me for at least 10 weeks or even more.
Hi, fxturtle, tell me as newbie please what is full version of SP? I am a bit confused and haven’t catch the sense of last phrase.
thanks in advance
lucky trading.
I have no trust onAuto trading. It is because there are many disadvantages of auto trading. It can be costly if you consider electric bill and internet bill.
Actually it is as effective as it creator. So better to trade manually.
The draw-down on the 2000 pips is only 9.32% on all 8 trades. The lot size is scaled down to keep my risk at my set amount. The later trades have a lower lot size to take draw-downs into account. I also have defined stop losses that I have set myself and a defined loss at this point. To lower risk even further I have set a fixed number of trades on the account.
Margret, if you agree with me risking 2,000 pips (although it is only 9.32%) and booking a profit less than 10 pips has no logic to it. It means the SP is unwilling to make losses, which can be extremely risky over time. Give it a thought, for your safety but it is your call at the end of the day. If it is working for you I wish you nothing but the best of luck
good good system looks really good but remember he only has a record of 8 weeks, which is not enough to judge whether he is a good trader. Angoria is too risky. Like I told margret, risking over 100 pips for 0.5 pips is rediclous, waste of time (at least for me). Qurenix is ok but again, not been trading for a long time. Good picks though, good good system looks the best but do remember he’s only been running for 8 weeks
i agree about the last 2 so i will dump’em and do test drive on ‘good good systems’. i know all the traders are relatively new but there is a chance for profit - and the logic behind is when a trader is new to the system he tends to behave overconsciously because he wants to collect the most # of followers …it is when they got it all that open trades and dd occurs (or the so called - ’ the market went agaist my analysis bul$$$%")
Thanks for the reply I am doing some thinking about the risk reward payoff you have been talking about. I am always keen to learn new ways of doing things. Can you explain a little more about what kind of risk reward ratio you consider effective and why you have chosen this amount.
To trade any signal provider you must use framework and this framework is there to protect ourselves from loss. I use a portfolio approach with my signal providers. I choose between 2 and 4 signal providers per portfolio.
I try and choose similar signal providers. I look for a similar number of curency pairs and I look for similar stoploss points. I need the stoplosses to be similar to ensure balance in the portfolio. Once I have found promising systems I run them through some risk calculators.
This gives me my lot sizes and and tells the max number of trades I should take for each system in the portfolio. I then backtest this portfolio to see if the signal providers are profitable with the max number of trades set by the calculators. If the backtest confirms profitability then I use the portfolio.
If however my backtesting shows that a signal provider is not profitable. I remove it and test a replacement.
Once I have 1 portfolio I contruct 3 to 4 more. I then split my trading capital into 4 to 5 parts. I use one portfolio for each section of trading capital. In this way I can diversify my risk from a single system running 100% of my money to 20 system each only running 5% of my capital
are you currently following any SPs on Zulutrade and if so, would you like to share? i am sure you have backtested and risk-waighted well enough in order to find the best out there at the moment of course.
Yes I have been away learning some other things. How are you? I hope you are well?
I have a different thing for you to learn. The guy who developed the risk calculators that I use for my risk management has released his website for free.
Instead of telling you which providers I am using how about I teach you how I choose and how I trade with signal providers.
To get some background knowledge read this website and sign up to learn how to use the risk calculators and how to construct a portfolio of signal providers. The vidoes are based on the old zulutrade site but they have told me they are developing the new videos as we speak.
Once you have read and watced the videos let me know and we can build a portfolio together.
i did read it couple of hours ago, as you posted it earlier, and thats why i asked as i am still a bit puzzled when it comes to it.
overall, great info and really great presentation.
So we are talking about risk management here…you think i can improve mine on my zulutrade account? …smth like lower risk but higher profitability?
