How would a martingale strategy be implemented in forex? - page 2

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Hi MetaSky

 

I was working on Martingale trading systems before.

Herein the risk embeded in the concept of martingale itself is inevitable. It is how much you can accept the risk.

There are two ways you can deal with Martingale.

  1. Avoid it. Dont' use martingale because one shot fails, then you are flushed out.
  2. Reduce the entries.
    1. Use sto, rsi, macd when overbought and oversold
    2. use MA to determine trend bull or bear, bull to buy and bear to sell. Don't trade against the trend.
 

Martingale is successful having infinite money available. XD

But if you have infinite money why you should trade? XD

In the very basic version, Martingale increase the lot size exponentially with the powers of 2:

1,2,4,8,16,32,64,128,256,512,1024,...

And so the risk increase in the same way...

Crazy! Suicide!

But Martingale inner power is this: it is able to neutralize all the previous series of losses. (starting with lot size 1)

so you can lose 2 trades and recover them with the 3rd

If you have enough money you can use the first steps of it: 1,2,4 (,8) without incurring in

too high risk. This could recover some unlucky trade this way. But no more than the 3rd or 4th step.

This can be a loss-recovery strategy, but nothing more than this.

Good when you have no idea how to trade, no strategy, noob! ;)

 

I have tone down the martingale betting and agreed that martingale is very risky

but the pretty thing is that you win ultimately 

 
oddpip:

Martingale is successful having infinite money available. XD

But if you have infinite money why you should trade? XD

In the very basic version, Martingale increase the lot size exponentially with the powers of 2:

1,2,4,8,16,32,64,128,256,512,1024,...

And so the risk increase in the same way...

Crazy! Suicide!

But Martingale inner power is this: it is able to neutralize all the previous series of losses. (starting with lot size 1)

so you can lose 2 trades and recover them with the 3rd

If you have enough money you can use the first steps of it: 1,2,4 (,8) without incurring in

too high risk. This could recover some unlucky trade this way. But no more than the 3rd or 4th step.

This can be a loss-recovery strategy, but nothing more than this.

Good when you have no idea how to trade, no strategy, noob! ;)

The problem with this thesis is, as you double your lot sizes, you have to be halving your stops... in order to maintain the same risk level. Halving the stops means you are  more likely to be stopped out as you increase your bets
 

I implemented it in ATC-2012 with some optimization. End up in 5th.

What i want to say is ,you can win for sometime but u will broke your account at the end if you play long enough. 

Or give back most of your profit in one trade. 

Black swam always appears. 

 
doshur:
You can let us know more details instead of a general name like martingale grid
Why you want to implment Martingale strategy? It is worst strategy ever made and only ruins the traders. See example in Signal Service - " FastWayToMillionReborn" - he ruined 900+ subscribers account in matter of one week.
 
gurmeetb: Why you want to implment Martingale strategy? It is worst strategy ever made and only ruins the traders. See example in Signal Service - " FastWayToMillionReborn" - he ruined 900+ subscribers account in matter of one week.
Thats not the whole story. He return Ten_Thousand_Percent for 900+ subscribers in 2_Months. Then he empty their accounts within one week. Perhaps you'll like to tell dosher which strategy to use instead.
 

Great thread. 

Martingale (at least for a few trades, given account size limitations)  seems very enticing, especially if I consider the previously mentioned doubling up when in profit.  Someone who really knows what they are doing could truly make a killing--if the stress doesn't kill them first! 

In fact, after 8 years of trading FX, I have rejected big stops and averaging down.  Instead, I use a tight 30 pip stop and take my small hit and move on to the next trade.  Today's US Non-farm payroll report is a good example of why.  100 pips in either direction in just an instant?  How can anyone stomach that (if on the wrong side)?  It's a 50/50 gamble.  Once the news is released, or once the politician begins talking, all bets are off! 

On the other hand, if you scale in and scale out then you CAN be very successful, but your idea must back test well, and you must be close to perfect in your discipline.  Try to find systems that will let you test this idea.

 
gurmeetb:
Why you want to implment Martingale strategy? It is worst strategy ever made and only ruins the traders. See example in Signal Service - " FastWayToMillionReborn" - he ruined 900+ subscribers account in matter of one week.
I believe there are people who uses martingale and are successful.
 

I have tried for myself but having a low budget it failed me.

Maybe some optimization is required. 

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