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Anton Voblikov (avoblikov)
Jun 01 2015 at 12:00
20 posts
Hi there!

Any good trader will tell you that Risk Management is the most important thing. It is even possible having a bad trading strategy but still make profit constantly with a good RM. Agreed?

I use the most standard one: My S/L is certain percentage of my balance (I use 0,35% for one account and 1,5% for another), and I have always fixed T/P which is S/L*3. So profit/loss ratio is 3:1. NO EXCEPTIONS!!!

This Risk management strategy works for me, all I need to have is winning rate above 30%. But there are some weak spots:

First: I don’t move my S/L, I don’t even touch it. It is either win by T/P of Loss by S/L.
Second: I miss large movements after my T/P was hit.

Please share you RM strategies and suggestions how I can optimize mine.

alexforex007
Jun 02 2015 at 03:42
774 posts
sometimes the market is not positioned to give you a 1:3 risk/reward ratio. I am happy with having a 1:1 ratio.

Anton Voblikov (avoblikov)
Jun 02 2015 at 07:31
20 posts
@alexforex007 do you fix S/L and T/P?

goodboyfx
Jun 07 2015 at 16:00
56 posts
haha funny, the most important subject not discussed much anyone much. Yet you see why 95% fail. Risk management is boring but a MUST if you want to survive. My 2 pence.

Get Rich & End World Poverty
Anton Voblikov (avoblikov)
Jun 08 2015 at 07:04
20 posts
goodboyfx posted:
haha funny, the most important subject not discussed much anyone much. Yet you see why 95% fail. Risk management is boring but a MUST if you want to survive. My 2 pence.

Exactly!!!

Niels (BOAR)
Jun 08 2015 at 07:12
18 posts
avoblikov posted:
Please share you RM strategies and suggestions how I can optimize mine.


If you trade purely on Price Action and Support/Resistance levels, you can choose to only enter trades where there is enough 'room' for price to move above and beyond 3× the Risk you take.
You could also look in to working with Limit Orders to reduce the Risk and increase the Reward distances on your chart.

Anton Voblikov (avoblikov)
Jun 08 2015 at 10:25
20 posts
BOAR posted:
avoblikov posted:
Please share you RM strategies and suggestions how I can optimize mine.


If you trade purely on Price Action and Support/Resistance levels, you can choose to only enter trades where there is enough 'room' for price to move above and beyond 3× the Risk you take.
You could also look in to working with Limit Orders to reduce the Risk and increase the Reward distances on your chart.


Thanks @Niels for your comment. I work with Limit Orders already. However the problem in my RM strategy is not that T/P wont get hit, it's that after hitting, the price continues to go and I miss larger profit. I mean, I limit my profit...

theHand
Jun 08 2015 at 11:56
365 posts
One of the most succesful traders I know, makes his money almost exclusively on risk management.

But it's not about TP's and SL's. It's about the overall performance of a system and its settings.

Since volitility, momentum and range are always changing, unless you have a machine learning system that would require some serious computing power, there is really only one way to consistantly make money with risk management. Changing this SL or that TP or using this support or that resistance or this and that indicator, adjusting trade sizes etc. on a single method is like chasing a rainbow or unicorn.

What he does is uses API's, runs up to 100 systems at a time. What makes it work is he is very agressive in scaling down strategies that aren't working and equally agressive in scaling up ones that are working. On Oanda for example he goes right down to 1 unit trades on losing systems, but leaves the system running until it starts working again. There's always something that's working to move money to.

Of course the job then becomes analyses of the various systems as apposed to worry about what the market does or even individual settings. Heck, try 10 variations, run em all. Try find the hottest streak, run with it while it lasts, and get out soon as it fails. So the job is almost exclusively risk management. But not at trade level. At overall system peformance level.

Niels (BOAR)
Jun 08 2015 at 12:47
18 posts
That is unavoidable if you want to stick to your own rule of not adjusting SL and TP.. Perhaps look into ways of trailing your SL and as soon as the SL is in profit, just remove the TP..

How and when to move your stoploss could be examined by drawing Support and Resistance from multiple time frames on your chart and watch price closely every time it approaches one of the lines you drew to see if it bounces or breaks.

Ari Goldman (arigoldman)
Jun 12 2015 at 12:22
907 posts
Interesting, thank you for sharing.

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