Guys i have changed my strategy from taking profit of risk reward of 1:3 to only 1:1.5. Do you guys think it will be more profitable in the long run as i have noticed a lot of trades which should have taken profit at 1:1.5 but beacause i let it run till 1:3, ,most of them have reversed resulting in only small profit. What do you think guys? please let me know, thank you.
There is a line you can cross between investing and speculating (gambling)
Managed FX as an investment should look to return 25-40% per year after fees with draw downs of less than 3-4% Max gearing used should be no more than 3:1 and a max of 2:1 is preferable.
Here are the simple sums (no gearing)
Two trades per day average win +25 average loss -15 Hit Rate of 70%
assume 20 trading days per month that a total of 480 trades per year
per month 28 wins of +25 (average) = +700 pips per month 12 losses of -15 (average) = - 180 pips
that's a gross total of 520 pips
Assume a USD account trading say EUR/USD and Cable then you have a gross profit of 5.2%
Take a 35% management fee - gives you about 3.4% net per month
Ignoring compounding that's 40.8% net after fees to the client
Remember the above are simply averages as viewed over a 12 month period - there may be times where a traded stop needs to be further than 15 pips from open (and obviously spreads and therefore trading time is a key factor) but never should more than 0.5% be risked on a single trade.
If you can do that and keep the draw downs below 3%: - You will have access to all the Assets Under Management you will be able to cope will and you will make a fortune...
In the real world you cannot sell high leveraged programs as the risk element to too great - remember savvy investors always look at the downside risk before they consider the profits!
Of course these are just my thoughts and targets from working in the sector and having my fair share of wins and losses over many years.
Hmm. You are right in general. It depends how you present your system : in high risk mode or in low risk one. All depends on the lot sizes you trade. Nothing is wrong to have 25 DD if you get 250 % profit per year. If you want to have 2.5 DD just divide your lot size by 10 and here are your 25% of sure secure profit. It is like a sportive car, you can drive on high or low speed, all depends on investor wishes.
Look009 posted: Hmm. You are right in general. It depends how you present your system : in high risk mode or in low risk one. All depends on the lot sizes you trade. Nothing is wrong to have 25 DD if you get 250 % profit per year. If you want to have 2.5 DD just divide your lot size by 10 and here are your 25% of sure secure profit. It is like a sportive car, you can drive on high or low speed, all depends on investor wishes.
hi alex,i remember you. i also added your account to watch last year but after 2 month why your system not visible? are you delete it..? why you delete your system? you blown your account?
Hi Billy, I deleted some demo systems that is true, no point here ! The DD had to be important (but no Margin Call or blown up) so I had to change algorithm and made some new adjustments, that changes completely the system which is not the same anymore. I hope I answered your question, wish you a happy trading !
I am searching for a consistency trader / fund manager... I loose a lot of money in Forex Envy pamm (solaris) cause i was a really newbie, without understanding how grid and martingale strategies were so dangerous... I have lost my faith, to find out a good fund manager. I do not want to have HUGE DD, but i wish i could have consistency. I have 10k to fund, but before to put all my money in one account i wanna split to see the performances... so 1k here 1k there.... Right now, i am using 1k only to Wise Invest Mam Low Risk. Till now, so far so good, they are working very well. But is too early to judge. So I will keep you posted. By the way stay away from grid stategies...
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คุณอาจสูญเสียเงินลงทุนเริ่มต้นบางส่วนหรือทั้งหมด อย่าลงทุนเงินที่คุณไม่สามารถสูญเสียได้ Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.
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