what is better?
Aug 13, 2010 at 19:01
Przeglądane 975
6 Replies
Uczestnik z Aug 04, 2010
4 postów
Aug 13, 2010 at 19:01
from myfxbook numbers.....a higher total pips (per month) or a higher % per month.
i would assume they run together, but thats not necessary true. which would grow an account more exponentially?
i would assume they run together, but thats not necessary true. which would grow an account more exponentially?
forex_trader_7
Uczestnik z Aug 01, 2009
941 postów
Aug 14, 2010 at 06:03
(edytowane Aug 14, 2010 at 06:08)
Only figure that matter is your NAV ( Net Asset Value) - That is Balance minus open losing positions.
Pips are irrelevant. I can show you anything I want with a pip.
On Fx book you'd look at the equity figure and see what that is as a percentage of balance. If its lower than 100% the system is busy losing, if it's higher than 100% the system is busy winning.
In most systems it would be under/over all the time, if it's a winning system they'll both rise in tandem, but if there's a system sitting there with equity as 50% of balance day-in-day out then it's just a question of time before it's demise...
If you set targets and trade sizes always from NAV. Nothing else reflects the total picture of the account.
Pips are irrelevant. I can show you anything I want with a pip.
On Fx book you'd look at the equity figure and see what that is as a percentage of balance. If its lower than 100% the system is busy losing, if it's higher than 100% the system is busy winning.
In most systems it would be under/over all the time, if it's a winning system they'll both rise in tandem, but if there's a system sitting there with equity as 50% of balance day-in-day out then it's just a question of time before it's demise...
If you set targets and trade sizes always from NAV. Nothing else reflects the total picture of the account.
forex_trader_7
Uczestnik z Aug 01, 2009
941 postów
Aug 14, 2010 at 06:13
In fact yesterday I banked Total Pips: 2811.2 pips and my equity fell from 100.14% to 100.09% by late afternoon. Was a losing day.
Uczestnik z Aug 04, 2010
4 postów
Aug 17, 2010 at 03:05
thanks for the advice, now whats better total pips or profit factor?
is profit factor even an end all/be all? i see its just a measure of how accurate trades are, but not necessarily total profitablility
>On Fx book you'd look at the equity figure and see what that is as a percentage of balance. If its lower than 100% the system is busy losing, if it's higher than 100% the system is busy winning.
what does this mean then?
https://www.myfxbook.com/members/peter2/caleum-group-hforex/37379
most ea's ive been looking at had 100% equity, does this one have some open trades not being shown?
is profit factor even an end all/be all? i see its just a measure of how accurate trades are, but not necessarily total profitablility
>On Fx book you'd look at the equity figure and see what that is as a percentage of balance. If its lower than 100% the system is busy losing, if it's higher than 100% the system is busy winning.
what does this mean then?
https://www.myfxbook.com/members/peter2/caleum-group-hforex/37379
most ea's ive been looking at had 100% equity, does this one have some open trades not being shown?
forex_trader_7
Uczestnik z Aug 01, 2009
941 postów
Aug 17, 2010 at 03:46
(edytowane Aug 17, 2010 at 04:00)
Pips don't matter.
So anything is better than pips.
NAV is the only thing that matters, forget the rest. And specifically NAV in context of Draw Down. If a system is doing 1000% a year then 30% draw down be acceptable, if it does 5% a year then 30% won't be acceptable.
Yes that one has a bunch of open losing trades not being shown. And they're quite likely to get worse with time. I personally would just ignore that one. They're just leaving the open trades till they go green. Because everything is locked you can't even see if it be up if they closed out. There's no telling what's going on in that account. Could be in losses right now you wouldn't know.
That system is busy developing a fat tail. https://en.wikipedia.org/wiki/Fat_tail
The outcome is a foregone conclusion. Just that the Caleum Group is a bit behind the curve by the looks of it. They still need to work out you can't get over the fat tail problem. Just a question of time before that account implodes. They might get lucky and survive a few swings, but at some point we'll get a strong trending market and then it's gone.
So anything is better than pips.
NAV is the only thing that matters, forget the rest. And specifically NAV in context of Draw Down. If a system is doing 1000% a year then 30% draw down be acceptable, if it does 5% a year then 30% won't be acceptable.
Yes that one has a bunch of open losing trades not being shown. And they're quite likely to get worse with time. I personally would just ignore that one. They're just leaving the open trades till they go green. Because everything is locked you can't even see if it be up if they closed out. There's no telling what's going on in that account. Could be in losses right now you wouldn't know.
That system is busy developing a fat tail. https://en.wikipedia.org/wiki/Fat_tail
The outcome is a foregone conclusion. Just that the Caleum Group is a bit behind the curve by the looks of it. They still need to work out you can't get over the fat tail problem. Just a question of time before that account implodes. They might get lucky and survive a few swings, but at some point we'll get a strong trending market and then it's gone.
forex_trader_7
Uczestnik z Aug 01, 2009
941 postów
Aug 17, 2010 at 03:55
(edytowane Aug 17, 2010 at 04:09)
Check my published system. That's an open fat tail. You'll see my stats looks similar, I consider that system not viable. If that kind of system worked I'd be rich already, years ago!!
Good balance results + locked open trades + equity down on balance + almost no losing trades = fat tail.
Fat tail = empty wallet at 100:1.
Good balance results + locked open trades + equity down on balance + almost no losing trades = fat tail.
Fat tail = empty wallet at 100:1.
forex_trader_7
Uczestnik z Aug 01, 2009
941 postów
Aug 17, 2010 at 04:34
https://en.wikipedia.org/wiki/Fat_tail#Applications_in_economics
Applications in economics
In finance, fat tails are considered undesirable because of the additional risk they imply. For example, an investment strategy may have an expected return, after one year, that is five times its standard deviation. Assuming a normal distribution, the likelihood of its failure (negative return) is less than one in a million; in practice, it may be higher. Normal distributions that emerge in finance generally do so because the factors influencing an asset's value or price are mathematically 'well-behaved', and the central limit theorem provides for such a distribution. However, traumatic 'real-world' events (such as an oil shock, a large corporate bankruptcy, or an abrupt change in a political situation) are usually not mathematically well-behaved.
Historical examples include the Black Monday (1987), or the unpegging of some currencies.[2]
Fat tails in market return distributions also have some behavioral origins (investor excessive optimism or pessimism leading to large market moves) and are therefore studied in behavioral finance.
In marketing, the familiar 80-20 rule frequently found (e.g. '20% of customers account for 80% of the revenue') is a manifestation of a fat tail distribution underlying the data.
Applications in economics
In finance, fat tails are considered undesirable because of the additional risk they imply. For example, an investment strategy may have an expected return, after one year, that is five times its standard deviation. Assuming a normal distribution, the likelihood of its failure (negative return) is less than one in a million; in practice, it may be higher. Normal distributions that emerge in finance generally do so because the factors influencing an asset's value or price are mathematically 'well-behaved', and the central limit theorem provides for such a distribution. However, traumatic 'real-world' events (such as an oil shock, a large corporate bankruptcy, or an abrupt change in a political situation) are usually not mathematically well-behaved.
Historical examples include the Black Monday (1987), or the unpegging of some currencies.[2]
Fat tails in market return distributions also have some behavioral origins (investor excessive optimism or pessimism leading to large market moves) and are therefore studied in behavioral finance.
In marketing, the familiar 80-20 rule frequently found (e.g. '20% of customers account for 80% of the revenue') is a manifestation of a fat tail distribution underlying the data.
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