NEVER LOSE AGAIN!! TheRumpledOne

[Pirilion]

i ran it from march, 08 to nov, 08, on hourly.

initial deposit = 10k
gross profit = 9531
gross loss = -8159
net profit = 1372
profit factor = 1.17

 

[north5]

Pirilion,

Was that my in this thread EA or one of your own?

 

[UKtradergirl]

Seems like a lot of effort for very little gain (assuming that is there is an actual gain).

However, if it is minorly successful i could see its uses as an EA. As a human operator however there is always the potential to make a minor error which would totally mess up all your profits. Not to mention how labour-intensive it is.

 

[Pirilion]

Pirilion,

Was that my in this thread EA or one of your own?

yours, mate.

agreed, uktgirl.

EDIT - BTW north, let me know if u need me to do anything with it or pm u screenshots, etc, since ur pc crashed at the wrong time.

be happy 2 help.

tc

 

[north5]

Cheers - well glad it worked well - however I didn't implement the loss exit strategy correctly so it will need to be run again. Good to see it is working though as I didn't do more than a very quick test of it.

 

[Pirilion]

Cheers - well glad it worked well - however I didn't implement the loss exit strategy correctly so it will need to be run again. Good to see it is working though as I didn't do more than a very quick test of it.

awaiting updated 1.

thx

 

[sweet pip]

Seems like a lot of effort for very little gain (assuming that is there is an actual gain).

However, if it is minorly successful i could see its uses as an EA. As a human operator however there is always the potential to make a minor error which would totally mess up all your profits. Not to mention how labour-intensive it is.

Why do you feel it's labour-intensive?

 

[north5]

I think this now has the correct exit on losses. Again, haven't had time to test and may not until much later tomorrow so any feedback gratefully received.

 

[UKtradergirl]

Why do you feel it's labour-intensive?

Because of the amount of screen time required per overall pip profit.

For instance, in say, 10 trades, 8 of them might be winners, 2 losers.

9 winners= 45 pips
1 loser= 20 pips

net profit= 25 pips

This is assuming you can acheive 90% winners (a long shot)
Drop that down to 8 out of 10 winners and you get:-

8 winners= 40 pips
2 losers=40 pips
net profit=0

So here you make no profit. So if you win 80% of the time you need to rely on the fact that you will be able to grab more than 5 pips profit here and there.

Even in the more generous, 90% scenario--- a profit of 25 pips for 10 hours sat at my computer- that is labour intensive to me. Yes you don't have to sit there constantly watching it but it's not far off this.

I suppose this is the price you will always pay when you do scalping. And probably the reason why i don't have the inclination to be a scalper over any period of time, although when i do scalp i would look for an average of more than 2.5 pips an hour.

At the other end of the spectrum, there was a guy on here a few days ago claiming to be able to take 80 to 120 pips per hour out of the market. Now that is just ridiculous.

All in all, i say that if this system makes you profit, if it works for you and suits the way you like to trade, then go for it.
If it were me i'd keep missing the turn of the hour and forget to monitor the screen,

 

[UKtradergirl]

I think this now has the correct exit on losses. Again, haven't had time to test and may not until much later tomorrow so any feedback gratefully received.

When i run it it keeps coming up with ordersend error: 130. Is this something i'm doing wrong?

 

[sweet pip]

Because of the amount of screen time required per overall pip profit.

For instance, in say, 10 trades, 8 of them might be winners, 2 losers.

9 winners= 45 pips
1 loser= 20 pips

net profit= 25 pips

This is assuming you can acheive 90% winners (a long shot)
Drop that down to 8 out of 10 winners and you get:-

8 winners= 40 pips
2 losers=40 pips
net profit=0

So here you make no profit. So if you win 80% of the time you need to rely on the fact that you will be able to grab more than 5 pips profit here and there.

Even in the more generous, 90% scenario--- a profit of 25 pips for 10 hours sat at my computer- that is labour intensive to me. Yes you don't have to sit there constantly watching it but it's not far off this.

I suppose this is the price you will always pay when you do scalping. And probably the reason why i don't have the inclination to be a scalper over any period of time, although when i do scalp i would look for an average of more than 2.5 pips an hour.

At the other end of the spectrum, there was a guy on here a few days ago claiming to be able to take 80 to 120 pips per hour out of the market. Now that is just ridiculous.

All in all, i say that if this system makes you profit, if it works for you and suits the way you like to trade, then go for it.
If it were me i'd keep missing the turn of the hour and forget to monitor the screen,

Well...those are big ass-umptions...LOL

On the contrary, taking a pair with a big hourly range, for example eurjpy, in only 1 hour I make way more than 5 pips. I only need 40, then I have the rest of the day off. I've done it hundreds of times.

The ability is here to lock in profit once in profit, and close part of the position, then let the profits run...sometimes they do. Isn't that one of the golden rules of trading?

Why are all the nay-sayers so stuck on only a 5 pips profit potential?

 

[Pirilion]

I think this now has the correct exit on losses. Again, haven't had time to test and may not until much later tomorrow so any feedback gratefully received.

THX MATE.

TESTED for 2 year period, hourly, eurusd.

profit factor = 1.25

deposit = 10k
gross prft = 15.5k
g loss = 12.5k
net prft = 3.1k

modelling quality = 36%

 

[zupcon]

When i run it it keeps coming up with ordersend error: 130. Is this something i'm doing wrong?

This generally means that either your stop or target is too close to the market. Some of the MT "brokers" require a minimum stop or target at least 10 pips from entry.

 

[UKtradergirl]

Well...those are big ass-umptions...LOL

On the contrary, taking a pair with a big hourly range, for example eurjpy, in only 1 hour I make way more than 5 pips. I only need 40, then I have the rest of the day off. I've done it hundreds of times.

The ability is here to lock in profit once in profit, and close part of the position, then let the profits run...sometimes they do. Isn't that one of the golden rules of trading?

Why are all the nay-sayers so stuck on only a 5 pips profit potential?

5 pips is the closest i can get to an approximation without using computers to figure out the exact numbers (which we are in the process of doing via an EA). The reasoning behind this is.. that TRO originally said to move stoploss to break even at 5 pips, then trail the stop. From what i remember, the trailing stop is very close behind so is likely to get taken out. In fact, at 5 pips profit, your stoploss at breakeven will probably get taken out fairly often too.

So to say that on average you will win 5 pips on 9 out of 10 trades i think is a very generous assumption to make. Play with the figures a bit more and you can get something very scary indeed

I was showing the system to produce a profit (probably a bit optimistic in retrospect) so i don't know what the problem is- "TRO true believers" should be happy with this.

 

[Brabed]

TRO,

Keep doing what you're doing man. I know you help a lot of traders, even if it's to help them think differently. I haven't tried this particular strat of yours, so I have nothing to add in regards to that, but just wanted to say, don't let the detractors get you down, this is your thread after all!

B

 

[sweet pip]

How about this for a revelation...the old 1:2 risk/reward rule is a fallacy
That's one reason why this system/method works so well...it's inverse risk

For those interested in reading a thread started on the matter, it can be found at babypips by Daedalus entitled "The Fallacy of 1 Risk : 2 Reward"...not sure if posting a link to it is allowed but it shouldn't be hard to find...

 

[north5]

UKtg,

My bet is you are using alpari. For some reason they add an extra digit to th end of their demo prices and it messes up my EA's. So the program thinks it os working with 20 pips when it is in fact 2. Try adding an extra 0 to the inputs.

Pirilion,

I have just run v1.2 on hourly EUR/USD and got a profit factor of 0.88.?


I agree that for people starting they can do a lot worse than chase pips with the current move and learn how price moves with them so I can see the benefit that TRO brings by trying to at least get people to see this. However rather than pointing out that people should follow the herd with scalping and go with momentum - he is suggesting a system that NEVER LOSES and presents indicators, screens etc to ensure that.

So for me the question is - does this SYSTEM indeed NEVER LOSE and at the moment the jury is out.

 

[UKtradergirl]

UKtg,

My bet is you are using alpari. For some reason they add an extra digit to th end of their demo prices and it messes up my EA's. So the program thinks it os working with 20 pips when it is in fact 2. Try adding an extra 0 to the inputs.

Pirilion,

I have just run v1.2 on hourly EUR/USD and got a profit factor of 0.88.?


I agree that for people starting they can do a lot worse than chase pips with the current move and learn how price moves with them so I can see the benefit that TRO brings by trying to at least get people to see this. However rather than pointing out that people should follow the herd with scalping and go with momentum - he is suggesting a system that NEVER LOSES and presents indicators, screens etc to ensure that.

So for me the question is - does this SYSTEM indeed NEVER LOSE and at the moment the jury is out.

Thank you North. Yes i am using Alpari. I have to go out this morning but when i'm home i'll make the adjustments and let you all know the results.

--

Regarding the risk:reward ratio argument above. I am well aware of this argument and any decisions about risk:reward have to be carefully analysed in the context of a trading strategy. Yes, at 1:1 risk:reward you can probably expect to win 50%, but changing the ratio to 2:1 doesn't necessarily mean you will still get a 50% win rate- infact in a lot of cases this may very well half the win rate. The trick is in finding a strategy that works for you that DOES do this. I am a mathematician and the pursuit of trading odds is something that interests me greatly.

Even if i had a strategy that won 99% of the time, i would not comfortable implementing it because of the risk associated with losing one trade. When you are stealing a few points here and there- to sit and watch a position go some distance against you is not a pleasant experience (more chance of bad trading psychology ruining your decisions). I prefer to work on honing my entries and exits in order to acheive greater accuracy and hence reduce the risk. If you can apply this to a 99% winning strategy- all the better- but this is the holy grail,

p.s. just wanted to add: my own trading style has an average risk:reward of 1:4. I don't take trades less than 1:2 and have also had some that show as much as 1:15. Yet i can still win at least 50% of the time. (not claiming this can last forever- no finalised strategy does- but we have to evolve and change when things start to change).

 

[nunrgguy]

How about this for a revelation...the old 1:2 risk/reward rule is a fallacy
That's one reason why this system/method works so well...it's inverse risk

For those interested in reading a thread started on the matter, it can be found at babypips by Daedalus entitled "The Fallacy of 1 Risk : 2 Reward"...not sure if posting a link to it is allowed but it shouldn't be hard to find...

Hmmm, interesting. How I read the initial post is that only R:R is being looked out without taking into account price levels, account size and position size.

Randomly moving your stop up to achieve a better pip R:R on entry (which is only a guess anyway) WILL result in more losers as stated.

Your stop should be placed where price dictates not at an arbitrary pip level. Then, if, with your stop at that level you are only risking x% of your account you may trade. If you are risking more than x% your account is not big enough for that trade, you are risking too much and you do not trade. R:R just based on number of pips is nonesense.

Also, the notion of R:R at position entry is only a guide you use to aid position sizing and for a notional target. Actual reward is not known until the trade closes. You only know THEORETICAL REALISED AVERAGE R:R from your system from back and then forward testing and I would suggest doing it manually.

For example do it over 200 trades and you should then see the risk/reward and win/loss you can expect to achieve. Your results should also be compared to what you would expect to see from your realised R/R and win/loss against random entry (casino type simulator). Compare against the WORST case scenario for P/L and drawdown. Did the simulator in the worst case wipe you out? If it did then I'm afraid all you did is get lucky in your testing. How many probable losing/winning trades in a row does the simulator say can occur? Did the number of losers happen in a row in your backtest? If not is suspect you got lucky.

The variables that have to be taken into account are account size, % account risk, % acount reward, wins, losses:these are actuals.

:idea:And here's a thought, if the win/loss ratio of your system dictates the requirement for a 2:1 R/R then when looking for an entry your target needs to be GREATER than 2:1 because that 2:1 is an AVERAGE over x trades.


This then gives you a framework to measure perfomance against when trading live. You KNOW when your system is working, you have the confidence to go through the losing runs knowing that the drawdown is to be expected. You know when the strategy is going bad if the number of losing runs exceeds what is probable. You know when to stop.

Without all of this you are just gambling.

What the poster in the thread suggests is moving the stop wider, to a position dictated by price (GOOD) but then having a negative risk to reward (on the face of it BAD if he talking about REALISED risk to reward). What he is actually doing, on the face of it is cutting his winners early and letting his losers run and he will eventually get wiped out.

 

[north5]

OK. Here is a final version. In the previous one you would not get a fair result if you set the TP > SL as it would always exit at a maximum of the SL Pips. It's not relevant for this - but then I do like my code to work properly.

This is as far as I'm going to take the code unless someone can come up with a good exit strategy for this that allows positions to run. My gut feeling is that in order for this to work it does rely on discretion to leave trades running.

I have always thought that getting out everytime for 5 pips WILL NOT work. Some quick backtests prove this as the profit factor is around 75%.

As a basic entry for beginners wanting to scalp I think they could do a lot worse, but I don't think this system is a NEVER LOSE proposition.

If anyone wants to backtest more then please do. It is hard coded to only work on H1 BTW.