I hope I grabbed your attention from my thread title (that was my intention, other than the fact that I like that movie haha). I will start off by saying that there countless ways to make money trading and I am not going to claim that my way of trading is the best. I have been trading for about 6 years now and have pretty much tried everything. Throughout my trading career, I have developed two strategies, one of which is an options strategy that uses crude oil futures options, and more recently is a scalping forex strategy that I am in the testing phase of (to be discussed here). My forex strategy is new (hence the “New” Wolf of Wall Street) and I have started a myfxbook account, you can search for BronzbeardTrader.
The concepts behind the strategy are extremely simple and utilize some of the most basic concepts of investing. The most important element of this strategy is position sizing followed by liquidity, scaling and taking profits when they present themselves. Direction does not matter. I repeat direction does not matter. I am a contrarian at heart so typically I go that route, but I will argue that this doesn’t matter. I take a look at the chart, formulate an opinion then put on a trade.
As positions start to go against me, I add to the position to continue to improve my probabilities of making money on the trade. My position sizing is super small on these trades which enables me to be able to withstand large moves against me.
There are no indicators being used, no fundamentals or news being paid attention to.
This is a highly active strategy and I have logged 293 trades so far in the last month with a 78% win rate and 7.1% total return. Max drawdown so far has been about 17% with max buying power being used of 28% account value. My goal is to gain about 2% per week and 100% per year.
Please comment if you have any questions! I am super excited about this strategy and it would be great to get a discussion going! Thane trade. My position sizing is super small on these trades which enables me to be able to withstand large moves against me.
There are no indicators being used, no fundamentals or news being paid attention to.
This is a highly active strategy and I have logged 293 trades so far in the last month with a 78% win rate and 7.1% total return. Max drawdown so far has been about 17% with max buying power being used of 28% account value. My goal is to gain about 2% per week and 100% per year.
Please comment if you have any questions! I am super excited about this strategy and it would be great to get a discussion going! Thanks!
Hi Paulypckt, Thank you for your post. I try to keep the position sizing as small as possible while still giving potential for a great return. I’ve even considered cutting it in half where it is, but we shall see. This is manual trading. Cheers!
With the start of the new week I have put on some positions in EURGBP, EURUSD, GPDUSD, USDJPY and AUDUSD. The only reason I am trading these is because they have the tightest spreads. I’ve already taken about 5 or 6 winners off the board and I will continue to reload. I usually like to have about 5 positions on at a time unless I have one that is starting to blow up. In that case, I will focus all my buying power on lowering costs basis for that underlying until I am able to take some profits.
i don’t use stop losses and have no intention to. When a position moves against me I add to the position versus closing it out. The fact that my position sizing is so small compared to my account value and I am able to absorb large moves against me.
I actually don’t mind it when a position starts to go against me, because ultimately it will mean a bigger winner. The key to this strategy is staying super small per trade so that you have enough buying power left to be able to continue to add to positions that go against you. Forex is the perfect market for a strategy like this because you have the ability to keep your position sizing super small with even a very small account.
Hello
This is the FREE Forex Trading Systems section so please post your system so we might review this !!
If this is not free please remove from this section…
And tell us how much this costs to buy.
Regards
Here is a daily chart of EURGBP, but the underlying security doesn’t matter. this is purely for illustrative purposes. What is the first thing you notice when you look at the chart. That price has gone up. Now this could lead to two different conclusions, if you are a trend trader, maybe you want to trade from the long side. If you are a contrarian trader, maybe you want to trade from the short side. Either way it really doesn’t matter. What DOES matter is the way you take profits or scale the position if it goes against you.
This method is not an order entry strategy in which you look for certain criteria in order to put on a trade. This is an order management method that is purely based on the way you manage the position once you have it on. The key is to always have a few positions on so that no matter what way price goes you can either add to the position or take a quick profit.
I thought I did lol, but maybe I am not being descriptive enough. The idea behind this strategy is a bit abstract versus what you typically see on baby pips though it seriously is the most simple way to trade. This is no different than a simple dollar cost averaging into a position, but being aggressive with your take profits.
Most people that trade using dollar cost averaging, do so with stocks which require a large amount of buying power and it is extremely inefficient. You need to have a massive account size to be able to be aggressive enough with scaling your trades in order to be effective. This is why Forex is the perfect market to do this strategy in because the margin requirements are extremely favorable and you can trade as small as you want. You get to trade like Warren Buffet (or some big wig hedge fund with $billions AUM), but on a much smaller scale, and with potentially better returns!
For instance, I use about 0.5% of buying power per trade which comes out to about $40-$50 in buying power reduction based on a $10,000 account. To see my returns so far, check out bronzbeardtrader at myfxbook.com or here:
Totally valid question, and I did specify that this strategy is in it’s “Testing Phase” in my first post, but to be honest I do NOT have this strategy in a live account. I am not trying to deceive anyone, and trust me there is no-one who wants more to put this into a live account than me! This is definitely in the works and I will be hooking this up to a live account as soon as I can!
As far having a track record that I can show in a presentable way that cannot be fudged, yes I have only formally tracked this strategy for a month, though I have traded this way off and on for a few years using futures, but never forex. And this strategy is in no way a new concept, dollar cost averaging has been around forever, and all I’m doing is aggressively dollar cost averaging with very small position sizing.
I was heavily influenced by Tom Sosnoff and Tony Batista’s scalping strategies on Tastytrade and there are many floor traders who trade this way as well.
Hi,
No worries, I wasn’t thinking you were being deceptive I was just surprised as I’d seen your post and thought 'great, someone who’s got some experience".
I wouldn’t consider asking you for a track record or myfxbook as your offering your system free, its only people trying to sell a system that I would insist on evidence from.
Will keep reading with interest, good luck
As part of an exercise to get people engaged and to help illustrate my scaling strategy, I will put on any trade that you want in the following underlyings: AUDUSD, EURUSD, USDJPY, AUDJPY, USDCAD, USDCHF (I would also list EURGBP, but I already have a position on in it and my reasoning for these underlings is purely based on their liquidity.)
To the first 4 people that respond to this post, tell me what underlying you want me to trade and specify which direction you want me to trade it in (For the time being, i will only trade each underlying in one direction). I am typically a contrarian trader, but that is besides the point here. My goal is to show that properly scaling into and out of a position is more important than picking a direction. Hope this goes well…haha!
P.S. Please respond soon guys, I need to put some positions on!
Excellent! just went long at 1.37582. If I can get a quick profit I will take it and if i need to scale the position because it is going against me, I will explain my steps.Thank you!
3 more to go guys! I usually have 5 different underlings on at this point of the week. The underlings left are AUDUSD, EURUSD, USDJPY, AUDJPY, USDCHF. Let me know!
Just booked $1.32 profit in USDCAD (good suggestion!). Given a $10,000 account I will look for about $1 profit per traunch.
I am in need of more trades peeps, please let me know if you want me to go long or short in the following: AUDUSD, EURUSD, USDJPY, AUDJPY, USDCAD, USDCHF
I’m going to bed so I needed to put on some positions but I don’t have any positions on in USDCAD, USDCHF or AUDJPY. Let me know long or short on any of these and I’ll Open them up! FYI I have a 8 month old so I am up a lot during the night so if I see new trade suggestions I’ll put them on as soon as I can. Thanks!
Status update: I added another short on the EURUSD at 1.11553. The original trade was down about $5 so that is what I look for before adding on another traunch. Got about 1% of buying power in this trade now.
