So, for the past couple of months, I’ve been diving into the world of trading and forex. And guess what? Last month, I decided to try out a new setup using support and resistance levels, RSI, and a moving average. And I finally had a positive month after a streak of disappointing results!
Now,I have to clarify that this was all on a demo account. But still, I managed to make a 30% profit despite only winning 40% of my trades.
So, here’s the thing—I’m feeling a mix of excitement and scepticism. Is this too good to be true, or should I gather the confidence to make the leap to a live account?
Also… is 30% a good result? It sounds excellent to me considering my previous results, but maybe you have a different opinion.
I’d love to hear your thoughts and advice on this.
Assuming 30% profit means you increased your account capital by 30% in a month.
Such a high profit on such a low win rate suggests either a colossal number of trades or very high capital risk per trade. Very high wold be 5% or more. What % of your account are you risking per trade?
if that is 30% a month, then it would be epic!
to measure your long term success, you can try to evaluate your performance based on at least 100 trades.
check your risk reward ratios and win rate and see if it turns out positive
One key aspect of my approach is employing a flexible risk management system, where I adjust my risk on each trade. However, I do have a limit set at 5% (but check my actual losses further down).
In the last period, I achieved a profit of 29.6%. Out of the total trades executed, I had 23 winning trades and 30 losing trades.
When we break it down further, the profit per correct trade amounts to 3.54%, while the loss per wrong trade stands at 1.73%.
Now, I’m eager to hear your thoughts. Does this approach seem sensible to you? I’m open to any feedback or suggestions you may have.
Your win rate is only 43% but your r:r is about 1:2. These are perfectly fine stats.
Its a concern that you’re willing to risk 5% per trade, even though the average loss is less than 2%. I have very rarely ever risked as much as 5% on a trade, and even then it was when I had a pyramided position with multiple positions already well in profit.
Thank you for your reply, it’s very helpful.
Let’s address the downside of my setup, which is the constant need for monitoring and lack of relaxation. To ensure I exit trades promptly when they are not going as expected, I rely on an exit setup that is often triggered well before the price reaches the stop loss level.
I acknowledge that utilising a 5% risk per trade is high, but I believed that, since I’m not actually waiting for the stop loss to be hit, it would be manageable. And so far, this approach has been effective for me. Out of the 53 trades I’ve executed, only one trade almost reached the stop-loss threshold (I lost 4.7%).
In terms of the worst results I’ve encountered, my second-worst loss was 3.7%, followed by one loss of 3.2%, and two losses of 3% each. The remaining 26 bad trades resulted in losses below 3%, with around half of them being below 2%.
Considering this, the question that arises is whether it is responsible to continue using this setup, or if I must stop immediately. Am I being irresponsible? Is that too risky to actually jump to a live account?
Thank you for taking the time to discuss and improve this dialogue.
Thanks, I appreciate your input. I’ll definitely give it some serious thought. I will test my strategy for another month, or maybe around 50 more trades, just like @eafiltergrid recommended. After that, I’ll make my decision based on the results. Your advice has been really helpful, and I want to make sure I give it a fair shot before deciding what to do next. Thanks again for taking the time to help.
I would be on the lower risk side, mainly because the market sentiment this year has been very sensitive to change, which accounts for these huge spikes i see during a week’s trading. I only have 5% open trades at one time, with most trades at 1%.
However, your risk management process does give you an edge over your initial risk exposure, and providing you can maintain a large account size , I wish you best of luck.
30% profit means it’s something huge. You may have over-traded and it’s not certain that if you continue this way, you will still remain profitable after three months.
@quasar_ssa first, congrats on your exit strategy, seems to play a big role in allowing a 43% win rate to be profitable. Word of caution, the plan to exit a losing trade early is relatively easy to implement on demo, making it a solid practice with real money bets is almost guaranteed to present more psychological challenges, so you’ll need steely discipline and determination to keep it working.
I would also think it’s a good idea to demo longer before making the jump to live if the high average value of your winning trades is created by only a few really good ones rather than a recurring norm. If so, a larger sample would help in determining if they constitute a ‘reliable’ probability. To that effect for my own stats calculations I like to apply a trimmed mean measure to eliminate some possibly unrepresentative outliers: omit an equal number (say 5 to 10 %) of the best and worst results. But that’s just me! Best wishes.
One key aspect of my approach is employing a flexible risk management system, where I adjust my risk on each trade. However, I do have a limit set at 5%, It’s important to highlight that the average loss per wrong trade stands at 1.73%.
That’s a bit of great advice. In this case, removing the 10% best and worst results, the profit would be 24,9%. What do you reckon of it? Thank you for your input.
Just wanted to drop by and give you a little update since you all came through for me last time. So, I’ve been testing my setup a whopping 99 times over the past seven weeks. Now, I gotta be real with you, my winning rate ain’t exactly stellar—it’s sitting at a measly 41%. But hey, here’s the good news: I managed to pull in a solid 52% profit during that time.
On average, my bad trades slapped me with a 1.5% loss, while the good ones treated me to a sweet 3.5% profit.
Now, here’s the plan: I’m ready to take the plunge and start trading on a live account. However, I’m gonna start with a small amount of cash, just to dip my toes in the water. I’ll need all the luck I can get, so if any of you have some valuable insights to share, don’t hold back!