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Money management vs Martingale....

Elkart
Elkart (Elkart)
Apr 24 2010 at 01:01
941 posts
I found this recently and thought some of you might be interested.

It's one persons application of MM and a much better bet than Martingale I believe.

https://www.winnersedgetrading.com/trade-of-the-day/nytime-money-management

 

biqut2 (biqut2)
Apr 24 2010 at 03:57
33 posts
Nice information, I think I will take into account in my own MM strategies. Would be curious to see what some of the opinions are from the long term traders on here. (I'm still getting my feet wet in forex)

Elkart
Elkart (Elkart)
Apr 24 2010 at 04:27
941 posts
Prof Van Tharp https://en.wikipedia.org/wiki/Van_K._Tharp also had a lot to say about this.

Basically it addresses the role of streaks on trading and how to deal with them. Increase the trades when it's going for you, decrease when you suck.


bestforexea (bestforexea)
Apr 24 2010 at 04:58
75 posts
Having experiences both situation... I am still trying to find if there is a balance between money management and martingale strategies.

The idea of managing drawdown from martingale with probably hedging vs MM when trades are moving in your favour.

Is there such a thing?

Elkart
Elkart (Elkart)
Apr 24 2010 at 05:31
941 posts
Casey read that article. In effect that is anti martingale with a limit to how much risk you add. Martingale adds to a losing streak, this adds to a winning streak...and that 's key...

AussieTrader
michigansurveys (michigansurveys)
Apr 24 2010 at 14:03
31 posts
Thats a pretty good article and advice. I really don't think you can spend to much time on perfecting the MM style that works for you and your system. I have worked with some algorithms in my EA that decrease lot sizes when a streak of losers appear. I do think that it can keep you from getting wiped out, especialy when a robot is doing the trading

Elkart
Elkart (Elkart)
Apr 24 2010 at 15:20
941 posts
Well, one concept that i find very important is this:

If you have 100 bucks and you lose 10% you have 90 bucks. If you add 10% to 90 bucks you have 99 bucks, not 100.

If you lose 50% of 100 bucks it's 50 bucks, if you add 50% to 50 bucks, it's 75 bucks, so to break even on a 50% loss you have to make 100%.

Don't lose. Which is what that article is about, or if you're losing lose less or nothing.

PrinceFx (PrinceFx)
Dec 08 2014 at 18:12
35 posts
Does Broker allow us to use Martingale in real account? Can we find in Term of Condition/Agreement or should we read in another source to make sure that martingale is allowed?

harin
Dec 09 2014 at 08:04
4 posts
I don't think they put it directly but you'll see the controls they put to limit/stop it:

e.g. exness and hotforex

- leverage (they lower the leverage when your balance gets higher or during holidays and weekends - e.g. https://www.exness.com/forex/leverage or https://www.hotforex.com/en/account-types/account-comparison.html)

- Minimum volume of position (they increase the volume requirement when your account gets bigger - e.g. https://www.exness.com/register or https://www.hotforex.com/en/account-types/account-comparison.html)

- Maximum cumulative volume of positions / Maximum Total Trade Size (Lots) (not in exness but other limit the max volume - e.g. https://www.hotforex.com/en/account-types/account-comparison.html)

- Maximum number of positions (they lower your max open positions when you have a highly leveraged account - e.g. https://www.exness.com/register or https://www.hotforex.com/en/account-types/account-comparison.html)

- Stop out level (stop out level increases on highly leveraged accounts - e.g. https://www.exness.com/register or https://www.hotforex.com/en/account-types/account-comparison.html)

Other brokers also do that. Those details are some that I look out for when I search for a broker. The ones that have the 'best' conditions like high leverage, no min/max on volume and open positions, and low stop out levels are usually scams based from my experience.

bscalper (bscalper)
Dec 09 2014 at 08:07
6 posts
Don't using martingale, you will got blow your account.
I'm using scalping with little SL and until now is working.

Let us rich together, because life is not long.
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