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YOU do NOT understand the formula for expectancy ,... Expectancy = (%winning trades * Average win) - (%losing trades * average loss) In these cases: 10% system expectancy = (.1*13R) - (0.9 * 1R) = 1.3-.9 = 0.4R 90% system expectancy = (0.9*.556R) - (.1 * 1R) = .5-.1 = 0.4R APPLES...

I trend follow as well and my win rate is 60-70%. It just depends on which trend you are following...micro trend, short term , intermeditae, long term. By looking for shorter term trends I tend to increase my chance of win and overall my system has become exponentially better. I used to...

90 % system at 1 % risk

Ok so now lets look at the SAME systems with a 1% risk of capital per trade. Again lets assume a $100,000 starting capital. Again 200 trades simulated 10,000 times. Notice that now the risk of draw down goes up even with the 90% system. However, also notice that in the 90% System the...

90% system at 0.1% risk.

OK,...here is a MC Sim for 2 different systems. BOTH systems will have a 0.4R Expectancy and assume a starting capital of $100,000. The first system has a win rate of 10% and the second 90%. These are the ONLY differences in the systems. Both MC simulations are done and posted below. Both...

I do NOT scalp or day trade. I swing trade and it IS very relevant!! I will post up MC Sim of trades soon for you to see what I mean. These trend following funds that have months or years of wins show exactly the same thing as I mentioned before....you need VERY LARGE Profit on small number...

The fact that you are risking ONLY 0.1% of your acct on this terrible a win rate means that you will have low risk of ruin....THAT is your money management (position sizing) that is keeping you alive. However, if you only risk 0.1% you will also have low profit and it will be hard to beat the...

It absolutely is relavant!!! It is MUCH harder to face ruin with 90% win rate than 10%. It all factors together is my point. All of these issues, profit factor, expectancy, and probability of winning trade, and standard deviation between each trade's win and losses also play a role in your...

LOL,...I know you and I have different objectives but you must learn to be happy with making money and as you seem to say GOOD money. NO ONE is perfect. Even Babe Ruth had more strikeouts than anyone else in his time. Yet he was still a great HR hitter. You should learn to praise your...

Awesome!!:)

WHY?....a win rate of less than 10% is highly probably NOT a profitable system. This is 5x WORSE than a coin flip. You could flip a coin to tell you to go long or short and do better with good money management (position sizing) rules. A win rate of <10% will have a HUGE drawdown as 90% of...

Follow my suggestions and you will become profitable. I have nothing to gain by giving you bad advice so understand that these are ALL thing I used to do (and suspect many of us did at one point and some STILL do). These rules changed my trading entirely. Good Luck

I would partly agree and partly disagree. Win rate is directly proportional to your drawdown rate. The lower probability trade you have the higher your drawdown and thus to limit this you must risk less per trade. A higher probability trade lets you risk more per trade and achieve your goals...

It seems that we are debating what "edge" is defined as and I think the OP just wants to know how long did it take to become profitable. Assuming that definition,... it has taken me 3 1/2 years to be profitable. I studied charts for 8-9 hrs/day for most days of the years. I studied...

As a matter of fact I did short prior to 9-22-11, but because of my TA indicators. :) I still do not see how this is a "no risk trade". Anytime you trade you are trading the right edge of the chart and do not have the benefit of hindsight. So how does your system tell you there is no risk...

I use TA about 95% and other factors 5% for my trading style and I find it very useful. No I am not failing at trading either. It is not for everyone. Those that do not know how to use it will say its useless. Those of us that DO know how to use it would strongly disagree with you.

OK,...please help me understand where you would have sold on this day given that the market opened up down big and remained down big all day. Would you have shorted at the open? Are you only day trading? If not then you have lost $$,...seems like a risk to me. If you day traded that day...

I already explained it in the other thread by the same OP with the same topic. Basically you figure your % risk you want to accept per trade. In a $100K acct lets say that is 1%...so $1000. If for example the stock you are buying is $100 and you decide your stop loss is at $98. There is a...

First off,...I don't know who you are referring to as "you losers" because I am certainly NOT a losing trader. Second, if you think there is no such thing as risk in these "event driven moves" then you are sadly mistaken. Why dont you give an example of a "no risk" trade so that you can...