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My dilemma

mavericks
May 13 2015 at 10:23
110 posts
If you chceck my website you will find a good way to market your signal without giving your strategy away. Something like creating stock out of a strategy. Investors can follow your strategy with as little as 50 bucks then.

Get investors and get paid 15 percent of theyr profits. More on my website.
xgavinc
May 13 2015 at 11:11
235 posts
Looks interesting mavericks... I will be taking a closer look at this.

From what I know about investors is the following (if you get private investors):

1. Drawdown less than 15%
2. The will not invest more than your own capital, and are more than likely going to hedge their funds in the form of assets / stock / equity.
3. Minimum investments from private individuals is usually US$10 000, international investors US$100 000 and hedge funds US$1mil
4. Performance record of at least 3 years.

That is why most of us (myself included) find that the only flaw in our strategy is capital, we don't have capital to match investors and before we can build up a 3 year profitable record our accounts are wiped out because we lack enough capital for large movements... it's a continuous circle of funding our accounts in the hope of breaking the capital barrier to prove our strategy.

The other problem I find with your strategy RSTrading, is that your returns are less than for example a money market account at a bank or unit trust... so that is something you will need to look at, reduce risk and increase returns... a very fine balancing act I know.

For every loss there should be at least an equal and opposite profit.
RedRhinoLab
May 13 2015 at 13:25
631 posts
You are on the right track of building a Low Level of Entry Strategy. As you are well aware, 2-3 years track record are needed for serious investors or a strategy with very safe R/R ratios. After a peek into your system, you risk substantial capital for 2 pips of profit. Once you reach your first loss, it will be apparent that your RR factor is skewed not in your favor and your backtests could have been over optimized. Once you recover from your first loss , the inherit risk factor is still there. To put this in perspective, - https://www.myfxbook.com/strategies/caesar-signal-forex-ea-7/77269 - system sustains profits every month for 7 years in a row, but its also risking 30% every day to earn a small daily gain. As soon as I go live with the system, I experience the high drawdown that is likely to happen every 7 years. Over optimization? Maybe, or purely the market got the best of me.

If we both need substantial amounts of risk capital to sustain life in the market, then we are saying we don't have a good strategy solely from a risk/reward perspective and we should redesign based on that important characteristic.

Increasing the winners and reducing the floating dd is difficult to do and that's the balancing act as @xgavinc states it. It's not easy!

Rihan
RSTrading
May 13 2015 at 15:15
385 posts
Thanks guys. I appreciate your input. I should have started a new thread, this one was started months ago. I have changed my view on this.
As mentioned earlier, I have tried to make it a bit more rewarding by adding four pairs. I am now looking at offering a pamm for small investors (3k+). These four pairs have their own set files based on the last ten years' trading.

In the last ten years it has taken four bad trades (as in 100+ pips in the red). The avg trade length is +/- 4 hours, if it is stuck in a trade for longer than a day I consider it a bad trade and look at the higher timeframes and consult other investment sites etc. to get an idea of what my move should be regarding that trade.

I also try to conclude all trades before weekends as trading doesn't necessarily continue on a Sunday eve where it left off on a Friday eve.

CrazyTraderfx (CrazyTrader)
May 13 2015 at 16:33
1718 posts
RSTrading posted:
I have tried to make it a bit more rewarding by adding four pairs.


This is an illusion. If you don't divide lotsize by 4, all you do is increasing risk.

You don't upgrade reward, in theory you just divide time by 4.... but the greed has a cost to cover, as you know you take the risk to be in red with 4 bad trades simultaneously. This can affect your hypotetical DD * 4 in case you don't divide initial lotsize by 4.

If I were you, with such strategy I would do another way to make fast money.

Rihan
RSTrading
May 13 2015 at 16:57
385 posts
CrazyTrader posted:



If I were you, with such strategy I would do another way to make fast money.


Please elaborate.

xgavinc
May 13 2015 at 17:22
235 posts
RSTrading posted:
Thanks guys. I appreciate your input. I should have started a new thread, this one was started months ago. I have changed my view on this.
 


Doesn't matter, your 'months' ago is another trader's 'today'. 😁

For every loss there should be at least an equal and opposite profit.
CrazyTraderfx (CrazyTrader)
May 13 2015 at 18:16
1718 posts
RSTrading posted:
Please elaborate.


Budget: €1000

4 pairs = 4 accounts of €100 each. (Highest leverage)
Depending on leverage, calculate max lotsize you can open with desire SL (30 or whatever)

Run them and see what happen after 1 month... if your strategy is still doing 100% profitable trades well you should be up on all accounts.

Anyway you still have €600 left in case one account goes wrong so you can restart 6 times.

Try one month on demo with max lotsize... and you will see how fast the account should grow. (why would you care about DD, here you are looking for fast growth)

Then you will get capital so you will do as you do now.


Rihan
RSTrading
May 13 2015 at 20:09
385 posts
This reminds me a lot of how some traders traded martingales. Set all the risks to the max, trade it on a small account and withdraw profits regularly, until the account goes bust, then start over.

I don't know. I am more in for the long haul, but considering the bad RR......

I am going to increase my lot sizes on this account and invite you to watch https://www.myfxbook.com/members/RSTrading/99-win/1126738

I will have a total disregard for DD, just to see what the EA is capable of doing. This account has a trademanager that trails profits in a stepping fashion. The trailing step kicks in when the trade goes in the green and immediately places a sl.. Many trades are then stopped out prematurely, but it also does wonders in a spike - in the last few trades it made enough pips to 'breakeven only' 10+ times.

FXtrader2010
Nov 23 2015 at 14:05
724 posts
what happened to this thread Rihan, are you still pursuing this? Cheers

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