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Bogie-HedgeHog-v4g Discussion
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Member Since Mar 11, 2010 4 posts
redpine
Apr 02 2010 at 09:52
duzyfx posted: the risk was then closer to ~20% since the pairs are correlated ... and were not used to actually hedge the trades (eg: buy EUR/USD and sell USD/CHF is like buying 2x EUR/USD if the pairs stay correlated) The problem with just dropping this EA on EU and UC is that they are negatively correlated. To trade them in a hedge fashion the ea would have to open positions on both pairs in the same direction with a scaled relative size. Droping the EA on both pairs results in orders entered in opposite directions on a negatively correlated pair giving approximately double the risk. There is no hedge in hedge hog. Also, being a martingale, it will eventually lose and will lose big without manual intervention. |
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Member Since Feb 26, 2010 21 posts
Dale (4xfreak)
Apr 02 2010 at 19:10
What 2 pairs could the EA trade then? If the EU & UC are negatively correlated what 2 pairs would create a true 'hedge' for the hedge hog to perform correctly?
Greatest Success ***Dale*** |
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Member Since Oct 28, 2009 78 posts
pipdetector
Apr 02 2010 at 19:49
(edited Apr 02 2010 at 19:50 )
According to the original Hedge Hog Trade Rules.pdf.
<quote> This system is based on the inverse correlation of the EURUSD and USDCHF. Typically if you hedge, you will buy a currency after you have sold it, or vice versa. Since these two currency pairs are the two most inversely correlated pairs, to hedge you would buy or sell ***both*** the EURUSD and the EURCHF. The entry for a trade is based on the divergence (or move away from) the EURCHF from the close of the previous day. To determine what to use for the daily close, you should use GMT as the time. When the EURCHF moves away from (or diverges) from the previous day’s close, it means the EUR and CHF are also getting out of correlation, and will typically want to move back towards the correlation. </quote> Somehow hedge hog foundation seems lost in the current edition... |
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Member Since Feb 24, 2010 59 posts
kelrine
Apr 03 2010 at 03:10
You mean v2 is better than v4 in hedging?
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Member Since Dec 31, 2009 141 posts
T. Buitendyk (tbuitendyk)
Apr 03 2010 at 05:53
(edited Apr 03 2010 at 06:01 )
wackena posted:
In the past, it has always been risky to trade Martingale type EAs. How about 'risky' in the PAST, in the PRESENT, and in the FUTURE?!? That would be a little more honest. The mathematically guaranteed 100% failure rate of martingale schemes does not and will not change. The only thing that changes are the sad stories of the people getting wiped out by irresponsible trading techniques. Frankly it makes me angry that they even allow martingale systems in here. This is not investing, it's gambling. These kind of systems are just another opportunity for people who DON'T know better to get hosed by listening to people who SHOULD know better. 
Gear on the left... |
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Member Since Aug 20, 2009 184 posts
kennyhubbard (compuforexpamm)
Apr 03 2010 at 10:51
Buitenduik,
You are out of line dude. Wackena is a well known name around the forex EA world and he has given freely much of his work. What have YOU contributed apart from your opinion? You may or may not agree with some of the mechanics behind his system and that is your right, but you should not try and imply that he is being irresponsible or dishonest. Now that is what makes me angry....... Wealth Creation Through Technology |
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Member Since Oct 28, 2009 78 posts
pipdetector
Apr 03 2010 at 15:28
As a matter of fact martingale is just a part of the system. A 'standard' martingale would double the position each time a trade was lost until a turnaround occured or a total disaster.
Here the doublng is capped at 4 plus you can control the rate at which the positions are magnified. So I agree with compuforexpamm that Buitendyk's comment is missing a point a bit. Plus don't forget that Wackena is testing this system with his real money... |
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Member Since Dec 31, 2009 141 posts
T. Buitendyk (tbuitendyk)
Apr 03 2010 at 16:52
OK, perhaps honesty is not part of the issue here, so I should not make that assumption and accordingly apologize for that.
That being said, I think that if you are running a system that can wipe-out 3 months earnings in one day then that HUGE risk needs to be put out front and centre at all times to protect the unsuspecting. I think we can all agree that there are far too many scams going on with forex that are costing a lot of unsuspecting people a lot of money. For those who are experienced in forex to not make such a GLARING FLAW as this crystal clear to the public remains in my view EITHER a lack of knowledge OR a failure of duty with respect to communicating about one's own system. To my mind both of these possibilities are bad, but you are right, they do not necessarilly imply intent to deceive. Gear on the left... |
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Member Since Dec 31, 2009 141 posts
T. Buitendyk (tbuitendyk)
Apr 03 2010 at 20:56
pc8multifx posted:
Don't trade live a marty system when it doesn't survive a full 10 year backtest and random backtests with the same setting! Margin call waits right around the next corner...  Looks like good advice in retrospect. Gear on the left... |
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Member Since Sep 23, 2009 125 posts
wackena
Apr 04 2010 at 19:39
tbuitendyk posted: pc8multifx posted: Don't trade live a marty system when it doesn't survive a full 10 year backtest and random backtests with the same setting! Margin call waits right around the next corner... Looks like good advice in retrospect. Long term backtests, at best, are only potential indications of how EAs will perform in Live accounts. As an example, here is backtest from 1999.<a href='http://www.myfxbook.com/files/wackena/BogieHedgeHogUSDCHF.zip' target='_blank'>BogieHedgeHogUSDCHF.zip</a> "Steady Equity Growth" is the name of the game. Attachments:
BogieHedgeHogUSDCHF.zip
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