Hi. I have been trading on simulator and made over 159 trades on 1hr tf on forex, only one instrument using only the chart. I managed to turn a starting balance of $1,000 to $5,400. I am pretty confident in my system. The results that the sim produces says that If I take 1 trade per day, I will make 28$ per day. Obviously this is not enough. 10x or 20x that would be better. So how to get 10x this? Well I thought of the different ways.:
1) If I had $10,000 or $20,000 starting balance.
2) Increase trade frequency.
If I made 10 to 20 trades a day with $1K it would be same as 1 trade a day with $10K. The problem with this is that: I wouldn't have enough margin to have 10 open trades at same time. Maybe only 2 max (with 50:1 leverage, which is max in USA) So I was thinking then that if I can't have 10 open at the same time then I would have to do trades one at a time and the only way to do that would be to go to even lower time-frame. However, the problem with the lower time-frame on forex is that the spread/commission make up a more significant part of your risk and therefore ruining your R:R ratio and turning your profitable strategy unprofitable. There is no way to get rid of the spread. The exchange/broker have to make money. So cannot make my risk smaller. (I guess I can try to double my reward then. I am wondering though if doing this will turn turn the strategy unprofitable, but I have to test it. We cannot believe in things that we have not tested. I will have to test that out and see if its profitable. If it is profitable than that would be ideal situation.) But anyways, keeping the strategy/R:R the same, if my stop was 20pips and spread was 1 pip then that would be fine. But the 20pip stop setups in forex are on the bigger time-frames like 1hr. This is the problem. So I wonder if there is any product besides forex that has the spread/commision very small in comparison to the stop size? Stocks? Find volatile ones? But then I am thinking, the more volatile the product, the bigger the spread? Catch 22? Anyone trade 1min charts? I wonder how the high frequency traders make money... Maybe there is no way and I need to just accept that I need a bigger account like $20,000 to make decent wages...
1) If I had $10,000 or $20,000 starting balance.
2) Increase trade frequency.
If I made 10 to 20 trades a day with $1K it would be same as 1 trade a day with $10K. The problem with this is that: I wouldn't have enough margin to have 10 open trades at same time. Maybe only 2 max (with 50:1 leverage, which is max in USA) So I was thinking then that if I can't have 10 open at the same time then I would have to do trades one at a time and the only way to do that would be to go to even lower time-frame. However, the problem with the lower time-frame on forex is that the spread/commission make up a more significant part of your risk and therefore ruining your R:R ratio and turning your profitable strategy unprofitable. There is no way to get rid of the spread. The exchange/broker have to make money. So cannot make my risk smaller. (I guess I can try to double my reward then. I am wondering though if doing this will turn turn the strategy unprofitable, but I have to test it. We cannot believe in things that we have not tested. I will have to test that out and see if its profitable. If it is profitable than that would be ideal situation.) But anyways, keeping the strategy/R:R the same, if my stop was 20pips and spread was 1 pip then that would be fine. But the 20pip stop setups in forex are on the bigger time-frames like 1hr. This is the problem. So I wonder if there is any product besides forex that has the spread/commision very small in comparison to the stop size? Stocks? Find volatile ones? But then I am thinking, the more volatile the product, the bigger the spread? Catch 22? Anyone trade 1min charts? I wonder how the high frequency traders make money... Maybe there is no way and I need to just accept that I need a bigger account like $20,000 to make decent wages...
I want 20K for the end of the year, so here is hoping account will resume it's upward trend, nearly there!! ( Percentage wise )