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If you used money management, orders 21 and 22 would have killed the deposit.
-> mrgmm You need to think about money management in terms of risk. Are you aware that your risk-per-trade at times is over 50%. In other words, 2 stopped orders would wipe your account. And that your true leverage is about 60:1? Have you comprehensively back-tested this strategy over multiple (& lengthy) time periods? Seems just to be an over-aggressive strategy that is bound to blow up an account sooner or later (probably sooner).
-> Shinigami If the money management technique used inflated the position size in direct proportion to the account balance, maintaining over 50% risk-per-trade than yes, a couple of losses would blow up the account. However, it is inaccurate for you to state that if money management were used, the account would have blown up. Firstly, not all money management strategies increase the position size in proportion to the account balance (some strategies reduce the position size in a winning run). Secondly, managing risk is a key part of any money management strategy and if mrgmm were doing this properly, it is my view that he would not be starting with this position size at all.
You are right. My vision for MM is to use the fixed lot for 5 days trading, then you can increase the lot size by 10 %. In this case if you faced with SL, you will loss a part of your past 5 days revenue, but the initial balance will never distroyed with this method
So, i change the lot size manually
Yes CB, it is over 50 %. but if i used 0.25 lots used in the statement, the draw down will be less than 15 % and the total earning will be 80 K instead of 315 K
I think if i turned 10 K to 80 K within four months it is good with maximum draw down 15%
Actually, i tested this EA for one year only (2009) beacuse, as you know this EA needs 15 M time frame which is not available on meta trader
If you factor the position size down from 9.00 to 0.25, won't that drop your max drawdown to about 1.4% and your profit to 9k?
Regarding data, have you tried Alpari?
You really need to test more time periods.
Especially with an EA that only works on one currency pair and has a 78% strike rate, there is a danger that it may be over-fitted.
I'm not sure what Shinigami was saying about MM because it makes no sense really -- no offense. Money management are just words that represent how you treat your balance and risk. Methods of actually managing your money can vary so greatly that it makes no sense to assume one would blow up an account with it. One could probably assume with greater accuracy that he would have taken less risk for more profit with good money management -- making gains exponential while keeping the drawdown very acceptable.
I have to agree with CB that you need to test this a bit more. Keep in mind though that if results seem too good to be true, they usually are. If your EA manages to turn 1k into 9k in 4 months with let's say 15% or less drawdown, you should be very happy with yourself.
I almost never comment on system results, but it's a holiday weekend in the UK and I'm in a holiday mood... 10K to 80K in four months is absurd.
If you can turn 10K into 80K in four months then in the next four months you should be able to turn 80K into 640K. And your original $10,000 into $5,120,000 by the end of the first year. Subject to not hoovering up the entire liquidity of the worldwide forex market, you would then become a billionnaire by the end of year 2, and the world's richest man by the end of year 3. Does any of this strike you as unlikely?
Difficult, maybe. Ambitious, yes... Absurd, not so sure about that.
You could do it on a roulette table in about 2 minutes rather than 4 months. That doesn't make it a viable forex strategy. If you think an average return of 2.6% per day is achievable then, frankly, I'd like some of what you're smoking. You're talking about something like a 500-fold return per year, turning $10,000 into about $5,000,000 in year one (and then into $2bn, and then into $1tn). It makes you wonder why all the billionaires on things like the Forbes list bothered doing dull things like setting up companies, manufacturing stuff, and so forth. They should just have sat at home, playing around with MT4.
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