The fallacy of Martingale/Grid systems

The vast majority of martingale/grid grid systems, or variations of are destined to blow up accounts (or result in unrecoverable drawdown). New traders may not be aware of these gambling methods, which require a near infinite source of funds to pull off.

How to spot a martingale/grid system

1) Short account life.
2) Unrealistic equity curves that only ever go up (unless they blow up!).
3) Equity will have significant areas of drawdown if the account hasn't blown up.
4) Increasing position sizes as the account gets further into drawdown.

Be wary of these systems, they look great until they aren't. This is a form of time-based gambling. (an very small minority of scenarios may be an exception).

Example equity curve attached.

I have yet to see one prune outlier trades effectively. I'm not saying it can't be done, it just I've never seen it. Anyone I have heard of that uses them, plans on running them until failure, while doing withdrawals until they blow up. Then they start over and see how far they can get.

So what's the alternate solution for this?

Trading multiple uncorrelated edges over a portfolio with appropriate risk management - which is what everyone should be aiming for.

Soooo many 'experts' are using martingale / grid systems it is shocking. I am surprised how long some of these systems work but eventually they always fail

Gwydaer posted:
The vast majority of martingale/grid grid systems, or variations of are destined to blow up accounts (or result in unrecoverable drawdown). New traders may not be aware of these gambling methods, which require a near infinite source of funds to pull off.

How to spot a martingale/grid system

1) Short account life.
2) Unrealistic equity curves that only ever go up (unless they blow up!).
3) Equity will have significant areas of drawdown if the account hasn't blown up.
4) Increasing position sizes as the account gets further into drawdown.

Be wary of these systems, they look great until they aren't. This is a form of time-based gambling. (an very small minority of scenarios may be an exception).

Example equity curve attached.

Dude, one thing you have to understand is that with any EA strategy, you have to have manual wind control or you may end up failing. This is because there are so many uncertainties in the market, such as the Fed meeting, or the monthly non-agricultural employment data.
So, it is very necessary to trade with artificial dare and good risk control. Moreover, many trading strategies, can only be applied to a certain market situation, for example, some strategies are only applicable to the up and down vibration of the market, but in the unilateral market, it is easy to lose money.
Therefore, the strategy I use, with 24-hour manual risk control, 2 years of time, very stable.

What do you mean by ' manual wind control '?