Still VERY early days.
I’d say i need 12 months data minimum before throwing more than an extra few hundred hobby money at the project.
So far I’m confident I’ll beat break even, and have a base to develop from… hopefully.
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I’m sure that if your mindset treats it like a new business venture, not a hobby, you’ll progress a lot quicker. I would also suggest two more data collections:
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record which pairs are profitable, and those which are not - and then focus on what works. In my case I find trading GBP/USD on my trending system is my largest loser by far. So I don’t.
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record what days of the week you are more profitable (or less loss) and try and determine why that should be the case. Asia markets seem to favour Friday, but London markets favour Monday.
I use Excel for that.
And I also demo a 5M scalping, which actually suits my strategy and lifestyle, but there’s no challenge involved. A little barren, IMO.
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Steve,
Thanks again for your input. I really do value it.
I think i came across wrong with the hobby comment, I meant I might divert some “Hobby money” into this account now and then if I don’t need it for tools, 3d printer filament etc.
My trading now has a proper business plan. I invest monthly into Shares and Cryptos at the moment (diverted most of this months investment money to seed this account). I believe short term my Cryptos, and to a degree my shares will outperform this… but I may be proven wrong.
I have performance criteria I’d like to meet over the next 12 months before I’d invest a large amount into my FX account, but when I do, IF the performance is 1/8th of what I averaged a month in Demo it would be enough to live on…
Regards the Data capture, I was planning to do that monthy, first Sunday. I will record every trade closed in that period, try to see what pops up. As you say maybe something will pop out.
Have you seen the “Performance Portal” for Oanda?
It looks like it will also track things like most and least profitable instruments etc too, which hopefully can add more weight to anything I gather myself.
Are you UK based?
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I checked out Tom after your recommendation and i thank you a million times. He is a genius.
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3X TP’s triggered today. Total banked profits now at 4%.
Total open PNL is 6.5%, so total NAV is 1106 GBP from 1000 GBP on monday.
3x new positions opened.
CAD/SNG Long 1%
GBP/USD Short 1%
NZD/USD Short 1%
I DO NOT believe for a moment the gains seen this week (or in my demo months) are an indication of future returns, but I am very happy with the way my first week live has gone.
I’ve proved my process to be easy for me to follow, stress free and straight forward.
The face that so far it’s been profitable at the same time is a bonus, and hopefully indicates that on average it should be a profitable strategy, with room to optimize and improve.
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A quick shot of the Oanda Perfomance Portal…
Only closed trades counted, 1 of the losing trades was actually my mistake where I took a 1unit trade at 0.0% risk and immediately closed it. So it’s only really 2 losses, the win ratio doesn’t reflect true ratio as such.
Once I have captured a huge amount of data this figure should be more indicative of the strategy.
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As seen on a few weeks on my demo, due to end of play profit taking at the end of the weekly session there is a little pullback on my open PNL in the last 10 mins of the session.
I saw a bigger pullback a couple of times, followed by a quick jump during the Asian Session on Monday to recover the pullback and more.
So OPEN PNL over the weekend is just over 5%, with 5 net positions being slightly in loss, largest one about 0.3% of account value. 11 net positions are in profit, largest is just over 1% of account balance.
End of first week definitely threw up a couple of lessons, but overall my time in demo has ironed out most of my strategy and process issues, I found the whole process pretty painless and stress free.
Have a great weekend Ladies and Gents.
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Great news. Keep it up. Tom Hougaard tells the story about the coin toss 100 times. He said the first time the end result was 51 heads and 49 tails, and the second time 52 tails and 48 heads. A result you would expect.
But he was surprised that in each of the 100 coin tosses he turned up 11 consecutive heads, and 8 consecutive tails on one and a similar consecutive run on the other…
I think you could relate that to your high overall trading exposure, albeit individual trades are low risk. Suggest you set a maximum OVERALL daily risk percentage, and keep to it.
Which I had to implement after on one day’s trade nearly a year ago, I had 13 losing trades on the bounce. Even last month I had eight consecutive losing trades albeit on differing days in one week.
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I remember watching a “magician” reveal how he did a piece of footage in one piece, no cutting, where he turned over so many carts of the same suit.
As you say, it’s probability and randomness, he just refilmed it repeatedly until it happened. About 50 takes.
This 12 months it’s about seeing what the probabilities are. What the risks are etc.
I think my bigger concern is more about ranging pairs rather than trending etc.
Playing all pairs gives me opportunity, but it means things can go unnoticed. Such as maybe a specific pair ranges a little, up and down enough to give indications a trend is starting, fail to trend long enough to be profitable etc. Dialing back the trend confirmation indicator however will get all trades in later and cut the profits by getting in later.
I’m looking more into variable risk based on performance. Something I’d like to develop is an advanced sheet when I record my closed trades I can find a set of criteria that will alert me to any pair that has either performed under a certain level, or lost more than one trade in a row.
I wouldn’t want to stop trading a pair, as you want to be there when it brakes the range and begins to trend. But you want to limit losses too.
I’ve subscribed to BST who have lots of ideas on risk.
One thing I saw was they used an inverse equity curve and increased/decreased risk with it.
Turned a system that returned 17% annually to 98% annual purely implementing that.
I believe with the variety of pairs I’m trading the issue for me will be more likely to be lose streaks in particular assets rather than the strategy as a hole. To kill the risk across the board indefinitely won’t really protect from the random chance of a statistical run of losses. It will just reduce the size of the DD, but also reduce gains before and after without a need to.
Psychologically I don’t think the DD would bother me if I was prepared for it, knowing it also allowed for greater gains both leading to and after the event.
I’m really interested in exploring more targeted and clever ways of identifying risk, and managing it.
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So now things have gotten underway, I think it’s time for this to be less of a trade by trade journal.
The ticker at the top will do the talking where that is concerned.
So a quick rundown of where we are and where we are going;
What happened so far???
1st March - Launch of LIVE account following 3 months of Demo and a longer period of planning & backtesting.
Opening of BP journal - Great reception, and great input regards risk management and links to experts in trading and psychology which are fascinating.
Opening of Myfxbook - Extra way to record and capture data. The more data the better.
How did it go???
Time - I have managed to find the time every day at work to do my 9pm trades.
Process - I have to say, my handwritten log has been easy to capture my trades, my precheck list and exposure checksheet has made life REALLY easy allowing me to carry out all my checks and new trades in under 20 mins per day.
Strategy - So far so good. Performing as per demo. Early days yet but I’m happy with it at this point.
Next Steps???
Learning - So from here I plan to spend a while listening to podcasts, youtube videos and learning generally by osmosis. Filling knowledge gaps.
Process - in the short term I do not plan to touch the process, no changes other than possibly to record the opening balance for each trade in my journal to better calculate the % gains later if needed.
Strategy - NO plans to touch the strategy until end of the first week of june if there are any improvements identified between now and then. See Risk below.
Risk - I have a plan to start reviewing my trades by instrument, extracting the trend per instrument (Pair) on a monthly basis.
I was going to score each pair (Colour code in spread sheet) and derate the instrument or uprate it depending on recent performance. This is to minimise exposure to ranging instruments, and focus risk on trending ones. I am still in an instrument that derated, in the hope that I am in it to catch the odd short profitable move, but also once the range breaks. I can uprate it on a “green” trade and go back to normal risk.
This is something I will work on the idea of over the next 3 months and potentially implement it on 1st week of June. However I do it, it has to be something simple to implement, and to test, something I review monthly and can simply write at the top of my checksheets, knowing I can just half (or more) my risk for that pair temporarily.
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So back in the saddle tonight for the first nights trading of the week.
Since daily open we’ve had 1x Trailing Stop loss (profit), and 3x Take Profits triggered.
All current trades checked, NO exit indicators so no action taken.
4 new trades (8 positions) opened, all at 1% risk due to existing open exposure on the currencies.
News wise I have the USD CPI on the 10th, so need to take action on open USD trades tomorrow, and CAD employment figures on the 12th to consider on the 11th.
NAV currently 1150 from initial starting 1000 last Monday.
Closed profit of 6% at this point.
All in all I’m going to keep plugging away, and carry out a review of all closed trades at the end of each month.
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little bit of long term planning today while pottering about and thinking… Well, the spark came to me after a comment on a podcast (Desire to trade).
What happens if my broker account gets frozen one day? What happens if they go bust? What happens if the account gets hacked etc???
I know the broker is FCA registered and covered by the Financial Compensation scheme, but IF one day this turns into a source of income, if I invest a large sum in it… what happens if there’s a delay accessing the cash to continue trading?
I did wonder at one point if I should just put half in one broker and one in another and trade both, but it means trading two platforms at the same time and just makes things harder and more awkward!
Then it hit me… Simply remove HALF the pot, just to quick access savings, do not invest it, and then double the risk ON account. Basically still trade the full pot value, but only hold half on the broker and half in my own bank.
Say the pot was 20,000. 10k would be in my bank, 10k on the broker. Risk per trade would be 2% of the 20k, or 4% of the 10k on the broker account.
Broker account rises by 2k, remove 1k to savings. Drawdown of 3k, 1500 goes from savings to the broker account.
In the even there is an issue, I just deposit the money into a broker account at another provider, such as IG and continue nearly seamlessly.
Basically make life as easy as possible, piece of mind and still allow me to trade one place and make the same gains.
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So through the day, due to the inflow of money back into the equity markets, we’ve had a little change in direction in some pairs.
2x Trailing stops taken in Profit through the day
This evening I had 3 trades (6 positions) with Exit indicators, so closed them out in loss. Nowhere near my 2% risk (TSL) so the Algo doing it’s job and getting me out of the trades.
Due to the potential unknown factor of tomorrows USA CPI, 2 trades (4 positions) were closed out. 1 at loss of about 0.6%, and one at break even.
This brings the open PNL much lower to about 4%, and the Closed PNL to just over 5.6%
Win ratio now looking much more realistic at 50%, RR rate is 2.9 currently.
We’ve gone in on another 1 trade at 1% risk, but everything else at this point is just in a place of wait and see.
Tomorrow may bring another couple of closures, maybe just in the loss, there are a couple that were just on the cusp of hitting the close indication, but not quite yet.
All very interesting, open PNL peaked at Equity peaked at 1159 which is 65 higher than current, which really does show you if you were getting yourself excited about the OPEN PNL you could get deflated when things turn around.
Temptation may be to kill trades when you see figures like those, but I know myself from Demo, I’ve done it twice, cut a few trades when they looked really good, didn’t want to lose the money… and then watched them continue on and would have added 4% to the account balance if I hadn’t interfered.
Time and data will tell me if I need to make adjustments to TP, TSL and Exit indicators performance.
Chris
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You trade the DKK too? haha. For some reason, it’s my favorite pair!! It moves so poetically! haha
It’s been really moving the last few days. It’s going to be bullish for the rest of the year. I have two trades for it. One to hold for about a year, and the other short-term swing trades/ hedging.
Since 2006 it’s been in an upward channel.
I’m trading the MA. I wanted to close, but no closing signal for me. So, I’m holding.
It’s due to start ranging soon, I think.
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At the moment I’m trading every currency pair on offer other than those with low leverage, so anything 20:1 and above.
In back testing most currencies were profitable most of the time with my algo, I plan to do something with the risk when they are in ranging periods to reduce loss and still be in it for the break out.
How long do you hold positions for???
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I don’t decided that anymore–my trading plan determines that! (wink)
But, really I started looking at the W1 and M1, and I could see where some pairs are going for the year. This was the first time, I’ve done trades like this. But the drawdowns introduce hedging opportunities.
So, while I’m doing whatever short-term trades, I have a few long-term trades running.
That’s why I wanted to figure out some short-term trading strategies. Anything lasting a few days to two months is ok for me. However, I may have to include the H4 with moderate TPs. We’ll see.
That’s cool that you have an algo!! I have to read this thread from the beginning!
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Sometimes I forget I’m not the only one trading minors. I forget if this pair is considered exotic…
Thanks for the photo!
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Yea, good stuff there. Thanks for sharing.
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One thing I have learned from all my trading research is that the no 1 thing that matters is state of mind.
This has made me look into myself a little and also “mindfulness”
One of the first things I’ve noted in myself is I am “on” 24/7. I don’t stop.
I’ve started to watch videos on simple meditation, breathing a calming techniques.
Just to slow down and stop thinking during simple tasks, be aware of the thing you are doing, 100% focus on it, even it’s brushing your teeth. No distraction, no thinking about the future, no thinking about trading, cars, rent… just focus.
The same applies when taking a trade. Focus 100% on the trade, the rules, the setup… calm… in the moment.
Something to work on.
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very nice sta®ts
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