POLL: win rate, reward:risk ratio

[ETcallhome]

yes, you certainly are the man of many centuries.

and i humbly pay homeage to yours, whataever they are,
or whatever strategies you employ....

care to elaborate a little for those who are still struggling toward much less than 100%....?

no, not interested in your statements or whatever, that is too nosey and too invading....

how about just show us a snap shot of your trading screen, live or sim, it does not matter at all? am sure there are many here would like to at least admire your super superlative contraptions. thx in advance for your enlightenment and generosity as well.

the screen shot will just show you one time order at 16:14 since that is when I trade everyday. If you can show me any trading strategy which risks less than 100% I am all ears. I doubt you would be interested in my trading strategy since all I have to do now is beat the long bond. But getting there involves a lot of unreasonable illogical risk. If you are not willing to risk 100% you are not trading, you are just experimenting. The whole deal is to get to the point where losing 100% of your trading account won't make much difference to your lifestyle. You get there by ratholing a little of your profits in something like SPY or BND over many years.
Trading is just a short term profession similar to Russian Roulette. It helps if you know where your risk of ruin is. The important thing to know is if you do it long enough it will eventually get you. If you have a strategy that has no risk of ruin or in otherwords won't eventually get you then I doubt you have really thought it through that deeply.

What separates trading from all other forms of gambling is you are not betting on the outcome of a coin toss or a final score or an earnings report. You are betting on how most others will bet. Similar to how a bookie makes a profit (when he is gambling.)

Struggling? I hear ya, I've been looking all my life for a perpetual motion machine or a trading strategy with less than a 100% risk of loss. If I could ever find one I would take 100% of my total net worth and trade it.

 

[ETcallhome]

That guys average down and up.
There ain't any secret.
A "successful" fool.

exactly, and once you accept that trading is for fools, then it is simply a matter of being a "successful" fool. If you are a good guesser or have good luck then you can just put it all on at once. In the end that is the best way. I'm not there yet. I still need to add to positions (due to bad guessing and bad luck.) Nothing worse than guessing right and having good luck and then having to add to a winner because you aren't large enough.

 

[K-Pia]

exactly, and once you accept that trading is for fools, then it is simply a matter of being a "successful" fool. If you are a good guesser or have good luck then you can just put it all on at once. In the end that is the best way. I'm not there yet. I still need to add to positions (due to bad guessing and bad luck.)

But a fool, if successful, means a lucky fool.
And we know that what's build on luck is fragile.
You say it yourself: "Put it all" so let's say you're lucky.
What will you do next ? Bet it all again ? Until you lose it all ?

"In the end it is the best way [to lose money]"

Tradin' ain't like casino because it's not as random.
And because you can build up the contract (Odds, Risk)
A trader has much more control than gamblers have.
But if you don't admit that ... Then go to the casino.
At least it's a mundane place. Not a cold screen.

By the way. I don't say there ain't no luck involved,
There are quantifiable and unquantifiable uncertainties,
But there is more than being lucky to be a good speculator.

 

[globalarbtrader]

do not mean to upset you or your plan, but why do you wish to limit your profit to only 3 to 1,
any logical or statistical substantiation, or just some very experiensed and profitable traders said so in whatever forms....?

just asking for your thoughts and reasons in your wanting to box yourself in to certain limitations. like saying ok, i'll get out when i make my 2 grands for today? pls do not feel like
you have to respond ok? am just tossing out my limited thoughts, alright? it is a good starting
question. do not let anyone stopping you from going forward, K? best trading wishes.

Just to be clear a win loss ratio of 3:1 or whatever, doesn't mean you're using profit targets. If you're using a trailing stop, or a contionus trend following rule as I do, then in theory you can have an infinite win:loss rate. In practice your average win:loss rate will be positive, but bounded, depending on how your trades work out, and how tight your stop is / how quickly you are trend following (a realised win:loss ratio of infinity is just silly of course).

GAT

45% win rate, 1.92 win:loss rate.

 

[ETcallhome]

But a fool, if successful, means a lucky fool.
And we know that what's build on luck is fragile.
You say it yourself: "Put it all" so let's say you're lucky.
What will you do next ? Bet it all again ? Until you lose it all ?

"In the end it is the best way [to lose money]"

Tradin' ain't like casino because it's not as random.
And because you can build up the contract (Odds, Risk)
A trader has much more control than gamblers have.
But if you don't admit that ... Then go to the casino.
At least it's a mundane place. Not a cold screen.

By the way. I don't say there ain't no luck involved,
There are quantifiable and unquantifiable uncertainties,
But there is more than being lucky to be a good speculator.

You sure about that? Almost all I have to show for myself is just the result of a few big lucky trades.

But like they say, you gotta be in to win.

 

[ETcallhome]

Just to be clear a win loss ratio of 3:1 or whatever, doesn't mean you're using profit targets. If you're using a trailing stop, or a contionus trend following rule as I do, then in theory you can have an infinite win:loss rate. In practice your average win:loss rate will be positive, but bounded, depending on how your trades work out, and how tight your stop is / how quickly you are trend following (a realised win:loss ratio of infinity is just silly of course).

GAT

45% win rate, 1.92 win:loss rate.

the only thing sillier than infinity is taking a profit

 

[OddTrader]

But a fool, ...
...
And because you can build up the contract (Odds, Risk)

Just don't feel too comfortable really when my nickname is mentioned above! But never mind!

 

[K-Pia]

Random means equally probable (Principle of Insufficient Reason)
It means that it is either fundamentaly or epistemologically orderless.
Everything ain't always Stochastic in markets ... Neither Deterministic.
Then it has several dimensions. Not only time, amplitude, and direction.

But even if the underlying was stochastic.
Speculators can adjust their exposure.
Think ANTIFRAGILE. In the world,
Lots of things gain from disorder.
It's all about your payoff.

And to tell you the truth @ETcallhome,
I've spend a lot of time figuring out how to tweak with my exposure,
In order to win big when I am "lucky" and lose small when I am wrong.
"lucky" because there is more than luck. Again. But let's attribute it to luck.

 

[K-Pia]

Just don't feel too comfortable really when my nickname is mentioned above!

Oh, yeah. I am sorry, didn't ask for permission to call you and your mighty friends in my post. I'll give it back. Thx.

 

[K-Pia]

That's a simplistic hypothesis.

I think that high win rate strategies,
Are more specific than high R:R ones.
They have lots of assumptions, parameters.
Kinda more complexe and conditions dependent.
Therefore more prone to perish as the edge vanish.

Whereas high R:R strategies are more dumb.
At least, it's not the same kind of intelligence.
They are more about method rather than setups.
Also more robust and portable than specific strategies.

Taleb could sums it up this way:
At one side the Smart and Fragile
At the other side the dumb but antifragile.

I wonder if it's a trade off.
Or if Smart can be Antifragile.
But from my experience dumb can be fragile.
So I'd be tempted to say that smart can be antifragile.