Anyone have two accounts and do regular hedging?
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Here is an example of an elaborate grid trading scheme. Now I am not endorsing it and I an not criticizing it. I just went over to another site and grabbed the first thing I could find. I am just backing up every statement I make with proof. There are many traders going long and short at the same time in the same instrument and here is one of them. Again, I do not Grid trade and I am merely giving an example to the thread author. This post was copied and pasted in its entirety from another Forum. I find it necessary to defend the fact that I have no credibility and I intend to prove it!
Remember this is just one of thousands of posts on the grid trading subject. There are completely different methods that have nothing to do with grid trading, that some of you cannot even fathom, of going long and short in the same instrument at the same time in gamma land that have nothing to do with grid trading.
Now as to the fear or failure of a trader to pick a direction..or to make a decision...or to pull the trigger...as illiquid brings out...could be a driving force in all of this. I have learned much from illiquid, Maverick, Riskarb and nearly all of the others here in ET as I am just a trader like all of you and really do not have a clue. I hope this post is not too long and now I will go back and crawl into my hole in my pitiful existence.
Now the fact that there are people doing this, does not mean that it is valid and Maverick may very well be correct...
but I challenge Maverick and you the reader to open your mind and ponder what the market can give and how to approach what it is telling you.
If you are interested in reading about the strategy and setup, please read it under the results. I didn't want to bore people with totally technical stuff, before getting to the juicy part
I'll post the results for next couple of weeks to discuss the progress with you. After that, I'll delete the post and start charging for the strategy (Kidding ofcourse)
06/15 - 06/23 (week 1)
Realized Profit: 9.2 % of the starting capital
(includes interest paid and received)
Biggest unrealized loss in NAV (so far): ~15 % of half the capital (~ = approximately. Half the capital: means one account OR ~7.5% of total capital)
Maximum risk, if all open trades are liquidated at current level with no new positions added or removed (Ofcourse if the spreads don't go berserk and remain within 10 pips):
~ 6% of the new balance. OR
~ 6.75 % of the starting capital.
Danglers open long: 12 K units
Danglers open short: 6 K units
Setup:
1. Two accounts, trading in both directions. Investment in both accounts is considered one unit, i.e. the profit/loss is shared.
2. Currency GBP/USD
3. T/P = 50 pips (I'll use ATR at later stage)
4. Spacing = 10 pips
5. Trading unit size: 1 unit for each unit in account.
7. Margin rate: 50:1
8. Is it aggressive? I'd say "no" only if I was drunk.
Strategy: (My style might look like a computer program. Well - I think that is expected from a Software engineer right?)
(Or probably by now, you'd have found that sense of humour + engineers is a rare combination)
1. Trade in the direction of the price, i.e. all long orders are above the price and short orders below the price.
2. Distance b/w current price and order: 20 pips
3. Try to eliminate danglers ASAP:
Why? - Because its creepy
Well, I find it hard to convince myself that the price will someday reach the point where I might profit from my trade. Who knows a George Soros look alike or he himself beat some country/bank to death. I don't have any connections what so ever with IMF to help me out, with a trade which is open for unlimited risk and limited reward.
Strategy a: Whenever a new position is opened and there is already an open position above/below that position, and total positions already opened are more than 10, calculate the difference b/w biggest dangler and newest open, divide it by 2, add 50 to the result, add/subtract result to/from the newest opening and set the t/p at resultant value.
Caveat: The price may not reach there !!!
Strategy b: Whenever the cumulative sum of open +ve trades is twice the amount of biggest dangler, eliminate it.
Strategy c: Which is still cooking in my head, but I have not implemented it yet is, if there are danglers in long direction, and the price heads south and starts opening trades in short direction, remove t/p of 50 pips from trades and let the price free fall, until the difference b/w winning short trades is twice the amount of losing long trades. Close all the trades in both accounts. Resume normal grid trading from there.
Sub strategy b and c requires API programming, which I won't hesitate in licencing from OANDA for 600 bucks a month if I am making money consistantly with this trading style.
Remember this is just one of thousands of posts on the grid trading subject. There are completely different methods that have nothing to do with grid trading, that some of you cannot even fathom, of going long and short in the same instrument at the same time in gamma land that have nothing to do with grid trading.
Now as to the fear or failure of a trader to pick a direction..or to make a decision...or to pull the trigger...as illiquid brings out...could be a driving force in all of this. I have learned much from illiquid, Maverick, Riskarb and nearly all of the others here in ET as I am just a trader like all of you and really do not have a clue. I hope this post is not too long and now I will go back and crawl into my hole in my pitiful existence.
Now the fact that there are people doing this, does not mean that it is valid and Maverick may very well be correct...
but I challenge Maverick and you the reader to open your mind and ponder what the market can give and how to approach what it is telling you.If you are interested in reading about the strategy and setup, please read it under the results. I didn't want to bore people with totally technical stuff, before getting to the juicy part
I'll post the results for next couple of weeks to discuss the progress with you. After that, I'll delete the post and start charging for the strategy (Kidding ofcourse)
06/15 - 06/23 (week 1)
Realized Profit: 9.2 % of the starting capital
(includes interest paid and received)
Biggest unrealized loss in NAV (so far): ~15 % of half the capital (~ = approximately. Half the capital: means one account OR ~7.5% of total capital)
Maximum risk, if all open trades are liquidated at current level with no new positions added or removed (Ofcourse if the spreads don't go berserk and remain within 10 pips):
~ 6% of the new balance. OR
~ 6.75 % of the starting capital.
Danglers open long: 12 K units
Danglers open short: 6 K units
Setup:
1. Two accounts, trading in both directions. Investment in both accounts is considered one unit, i.e. the profit/loss is shared.
2. Currency GBP/USD
3. T/P = 50 pips (I'll use ATR at later stage)
4. Spacing = 10 pips
5. Trading unit size: 1 unit for each unit in account.
7. Margin rate: 50:1
8. Is it aggressive? I'd say "no" only if I was drunk.
Strategy: (My style might look like a computer program. Well - I think that is expected from a Software engineer right?)
(Or probably by now, you'd have found that sense of humour + engineers is a rare combination)
1. Trade in the direction of the price, i.e. all long orders are above the price and short orders below the price.
2. Distance b/w current price and order: 20 pips
3. Try to eliminate danglers ASAP:
Why? - Because its creepy
Well, I find it hard to convince myself that the price will someday reach the point where I might profit from my trade. Who knows a George Soros look alike or he himself beat some country/bank to death. I don't have any connections what so ever with IMF to help me out, with a trade which is open for unlimited risk and limited reward.
Strategy a: Whenever a new position is opened and there is already an open position above/below that position, and total positions already opened are more than 10, calculate the difference b/w biggest dangler and newest open, divide it by 2, add 50 to the result, add/subtract result to/from the newest opening and set the t/p at resultant value.
Caveat: The price may not reach there !!!
Strategy b: Whenever the cumulative sum of open +ve trades is twice the amount of biggest dangler, eliminate it.
Strategy c: Which is still cooking in my head, but I have not implemented it yet is, if there are danglers in long direction, and the price heads south and starts opening trades in short direction, remove t/p of 50 pips from trades and let the price free fall, until the difference b/w winning short trades is twice the amount of losing long trades. Close all the trades in both accounts. Resume normal grid trading from there.
Sub strategy b and c requires API programming, which I won't hesitate in licencing from OANDA for 600 bucks a month if I am making money consistantly with this trading style.
If you folks really expect me to post a link or walk you through this...just forget it...
PLEASE STOP THE PM"S
I am simply a writer/reader/guest here and I do not want personal relationships or the more "time-sensitive" nature of a PM, requiring my attention and faster reply.
I will not post links in this instance, as I do not want to draw folks away from ET as my goal is to contribute here for years to come and to support ET in what they do.
If you need to ask a question...try it here ...there are not any stupid questions. If you have a point to make...post it here...if you want to assist me in proving my lack of credibility, then please post it here.
I am taking requests for bitch slapping with a slab of beef from my local butcher...its fresh...eat fresh...(if you are from Europe, I can arrange a London broil cut) (If you are from New York...well I have only one cut for you...)
Archy
PLEASE STOP THE PM"S
I am simply a writer/reader/guest here and I do not want personal relationships or the more "time-sensitive" nature of a PM, requiring my attention and faster reply.
I will not post links in this instance, as I do not want to draw folks away from ET as my goal is to contribute here for years to come and to support ET in what they do.
If you need to ask a question...try it here ...there are not any stupid questions. If you have a point to make...post it here...if you want to assist me in proving my lack of credibility, then please post it here.
I am taking requests for bitch slapping with a slab of beef from my local butcher...its fresh...eat fresh...(if you are from Europe, I can arrange a London broil cut) (If you are from New York...well I have only one cut for you...)
Archy
now i feel bad.
Its just that if one more HF or some opportunist (s) contacts me about partnering up and paying me.... which equates ending up with a 5% commission, I will change my handle.
While they go out and build a client base out of a lack of sales talent..I say this because the large accredited investors get them down to 10% and no management fee....Anyways while these scam shops from Canada which are a dime a dozen in Retail spot Forex do this, I am expected to trade 24 hours around the clock and provide two ISP's and full redundancy built into a trading room with two traders....
It's my own fault...I just thought that OPM would get me retired faster...I trade my own money now...I want nothing other than to give to this community any knowledge or help that I can...There is nobody in ET that has anything to give as far as OPM...so if you are thinking of trolling for money, don't do it reader..to me or to the guests here in ET...
ok ..so my website still has a managed account button....but that is for entertainment...its always the same. I was thinking of hooking up that very professional Bernacke Video up to that button...did you guys see that?
Its just that if one more HF or some opportunist (s) contacts me about partnering up and paying me.... which equates ending up with a 5% commission, I will change my handle.
While they go out and build a client base out of a lack of sales talent..I say this because the large accredited investors get them down to 10% and no management fee....Anyways while these scam shops from Canada which are a dime a dozen in Retail spot Forex do this, I am expected to trade 24 hours around the clock and provide two ISP's and full redundancy built into a trading room with two traders....
It's my own fault...I just thought that OPM would get me retired faster...I trade my own money now...I want nothing other than to give to this community any knowledge or help that I can...There is nobody in ET that has anything to give as far as OPM...so if you are thinking of trolling for money, don't do it reader..to me or to the guests here in ET...
ok ..so my website still has a managed account button....but that is for entertainment...its always the same. I was thinking of hooking up that very professional Bernacke Video up to that button...did you guys see that?
I think the trouble with that is that no others will make the market in a pipless environment...keep a low profile slab-boy..
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