Then keep it up. It's a good start. Try and maximize your backtest period over at least a few years, or 10,000 trades. Then forward test.
Strategy makes money but more losers than winners
- Thread starter zanek
- Start date
Probably professional trend followers with high reward/risk do not care but experience says that retail trader spychology is badly affected by low win rate. So try to keep it above 50% with reward/risk of at least 2 and you will do well if you manage positions properly. Good luck to you.
Easy to increase the win rate with a little curve fitted profit targeting / trailing stoppage applied. Really smooths out the equity result.
I have a trend system that is actually my best money maker, but the consistent losses, one after the other, sometimes 50 in a row, starts to make a doubter out of me.
The funny thing, I made one change to it, replaced fix stops with traling stops and it never made money again after that.
the mkt is set up so it trends only 20% of the time, but when it figures out that I am making money on that 20%, it increases the chop from 80% to about 90 or 95%, just to shake me out.
I think you're the retard. He specifically states that the strategy makes money, so that is not the issue. The issue is that you need a large account to withstand the periods of losses. If you had 1,000$ account, chances are you will blowup on the first few losses versus if u had 1000k account, where you can withstand those losses and make up for it with the wins.
This doesn't surprise me at all in my studies. There is a (mathematical) reason for it that is fairly obvious if you think about it. I also believe that it is the reason that certain strategies rotate in and out of favor in time periods.
You and I are different. My natural instinct is to try and figure out precisely if and why this kind of finding is so and look for an edge. Many just say, well that system didn't work and randomly move on. For those people, I guess that their chance of success is also pretty random.
You have probably heard about KISS in trading rules. It stems from the basic principle that most rules attempt to over optimize and thus end up with worse performance. Sadly, the world has infinite possibilities and creating models by definition will eliminate certain possibilities. The only completely true model of the universe, is that universe.
Just to be clear, I am not saying any method of dealing with such an anomaly is best, I am just saying we are different. That is a good thing, or there would be no market.
I'm about as random as you can get. In the early days of computers, we worked on random number generators. It's not as simple as you might think. When I dropped out in the 70's, they still weren't sure it was possible, which led some to doubt even the existence of random.
the search for randomnsess is just as open ended as the search for order
yes, I agree, I am very different