Risk it all trading. BTW it is Risk Capital after all.
Jul 23, 2015 at 16:18
594 Angesehen
4 Replies
forex_trader_165856
Mitglied seit Dec 03, 2013
631 Posts
Jul 23, 2015 at 16:18
I've been obsessed with statistics and what the data displays about a trading system. I often critic the trading system very difficultly as if there must to predefined criteria that be met to even consider it worthy. I am wrong? For example, I look at the largest win and the largest loss to determine potential Risk/ Reward ratio both in pips and dollars.
Shouldn't there be a simple calculation that says, ' This system is good' or This system is a 'Risk it all system'? We should also know if the system is still under the same criteria.
I am positive that you have seen those freshly created accounts showing 1000 - 2000% gains, but once the buzz is out, the systems no longer achieve the same gains. Such as running 100x risk for a few days or weeks and then cutting it down to 1x risk to skew the statistics. If you risk it all, shouldn't you do it again since that's your approach and it is just risk capital. The number one question that I see, hear, and often answer is ' What is the maximum drawdown?'
The answer should always be -99.999% . This is risk capital. Be prepared to lose it all, if you can't afford to lose it all, then put what you can't afford to lose in another account. Only invest your risk capital. If you need to risk 1% of $1000 ( $10), do you need the whole 1000 in your account? No, you only need enough margin to maintain the positions that you want to trade. The question should be, how much margin do I need to use to make the trading decisions that are within the trading system. So who is risking it all ?
Shouldn't there be a simple calculation that says, ' This system is good' or This system is a 'Risk it all system'? We should also know if the system is still under the same criteria.
I am positive that you have seen those freshly created accounts showing 1000 - 2000% gains, but once the buzz is out, the systems no longer achieve the same gains. Such as running 100x risk for a few days or weeks and then cutting it down to 1x risk to skew the statistics. If you risk it all, shouldn't you do it again since that's your approach and it is just risk capital. The number one question that I see, hear, and often answer is ' What is the maximum drawdown?'
The answer should always be -99.999% . This is risk capital. Be prepared to lose it all, if you can't afford to lose it all, then put what you can't afford to lose in another account. Only invest your risk capital. If you need to risk 1% of $1000 ( $10), do you need the whole 1000 in your account? No, you only need enough margin to maintain the positions that you want to trade. The question should be, how much margin do I need to use to make the trading decisions that are within the trading system. So who is risking it all ?
Mitglied seit Oct 02, 2014
909 Posts
Aug 09, 2015 at 16:36
cfd would be less risky.
Positivity
forex_trader_224024
Mitglied seit Jan 01, 2015
45 Posts
Aug 10, 2015 at 06:39
My small gambling account [IC Markets $14k USD] not doing too good at the moment. 😝
https://www.myfxbook.com/members/EquityArtistry/ic-markets-small-gambling-account/1331013
https://www.myfxbook.com/members/EquityArtistry/ic-markets-small-gambling-account/1331013
Mitglied seit Nov 21, 2011
1718 Posts
Aug 13, 2015 at 14:25
RedRhinoLab posted:Yes I do now on specific account with low deposit:
So who is risking it all ?
Once you double the account, you are tempted to increase lotsize accordinglly. Every one think that way and would do that! Here it comes the mistake!... why?
Deposit $100
Fantastic, you double the account, you now have $200
Fantastic, you double the account, you now have $400
Shit, you just blew up the account
Result: you lost $100 while you were up to $400! =>
Imagine, you want to invade the universe... Would you send only 1 spacecraft figther?
You need an army!
Same for forex, agressive trading (gambling) is probably also a great way to make fast money at almost no cost when it is well designed... while a trader will spend tons of effort to be rigourous, stick to his plans on the long run.... anyway when there is disaster on Forex like CHF this year, you can be the most disciplined trader in the world, nothing you can do against fx tsunami.
So before the step to increase lotsize... you need to build an army! => A lot of fx accounts!
Here is my first account: 100% reached
https://www.myfxbook.com/members/CrazyTrader/m-w--my-fx/1283070
Now, I have created a second account, I transfered same deposit, and I will double the account.
It will take the time it needs to take, I will build at least 10 accounts.
At some point, i will get 10 accounts of $100... (and into the bank the initial deposit safe)
I will start to trade them (1 order at time/account)... This time, when I double the account, I can increase the lotsize !
When I lost 5 accounts... and 5 accounts still alive...I take money from them and and make equal money on 10 accounts
As you see, with a smart and logical strategy... then it is almost not possible to loose account anymore.... You only have the chance to win.
ps: It's not so hard to double an account with low deposit.
So... ?
CrazyTrader
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