Very Profitable Heiken-Ashi System - page 2

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mikejody
518
mikejody  
rogerha:
I wish you luck, but I think you'll find you'll get bitten in the end. The answer to the trading conundrum is risk/money management and an edge. This way you are prepared for anything the market throws at you.

As somebody else posted on another thread here, you might find this interesting.

http://grailtrading.blogspot.com/

Yes, that URL was a serious look at drawdown, for sure. And this system does have large drawdowns. People who like systems with less drawdown will not want to trade this system the way I have it listed. And if you remove the drawdown (the Martingale money management) then you also remove the "edge", as the system is not profitable without the money management.

All I can say is it fits my style, at least for now. Thank you for your comments.

mikejody
518
mikejody  

Spreadsheet Stats

Hopefully this spreadsheet will come through acceptably.

rogerha
43
rogerha  

Well I genuinely wish you luck, we all have our own methods and requirements, and what is good for some traders is not good for others.

I sort of read that as a combination of simultaneous losses and account management. Admittedly he was trying a very high-risk experiment with a very large exposure. Where I assume you re limiting your account risk to a certain percentage that may be more realistic.

Martingale works in theory. But you have to have rather a large proportion of capital to start with, and some fairly large balls. I would say that a very large percentage of people could not cope with the emotion that entails particularly after a long string of losses, but if you can then that's good for you !

mikejody
518
mikejody  

November and December Stats of Heiken Ashi System

Roger, you are right about needing high risk tolerance for this system, December tested the size of the package for sure!

Here are the stats.

mikejody
518
mikejody  

Stats for November and December

This would have been a nice Christmas present on a live account.

timbobo
55
timbobo  
rogerha:
Martingale works in theory. But you have to have rather a large proportion of capital to start with, and some fairly large balls.

Martingale does not work in theory. It does not improve your chances, it's neutral if your have unlimited deposit.

But it works in real life if chances for too many losses are pretty low. Personally I would try to use Martingale with profitable system to improve it. But I would need to be sure that system makes not more that 2-3 losses in row. In my tests that Ashi system did 9 losses in row. Even 5 losses in row will wipe out money for many days of trading.

mikejody,

Similar to you I'm looking for good system and your 3 requirements are mine as well. EAs would help with it. I'm sorry to say that but even 54% of profit orders with almost equal SL and TP is not good at all. As I said you can get similar results without any indicators just using a coin.

mikejody
518
mikejody  
timbobo:
Martingale does not work in theory. It does not improve your chances, it's neutral if your have unlimited deposit.

But it works in real life if chances for too many losses are pretty low. Personally I would try to use Martingale with profitable system to improve it. But I would need to be sure that system makes not more that 2-3 losses in row. In my tests that Ashi system did 9 losses in row. Even 5 losses in row will wipe out money for many days of trading.

mikejody,

Similar to you I'm looking for good system and your 3 requirements are mine as well. EAs would help with it. I'm sorry to say that but even 54% of profit orders with almost equal SL and TP is not good at all. As I said you can get similar results without any indicators just using a coin.

This system has been very profitible every month of June through December last year. I have also just completed testing January and February of last year, and it made over 1400 pips.

The drawbacks I see to it are the low hit-rate (45%) and the large drawdown due to using Martingale.

I believe both of these could be fixed if we were able to get a different indicator that gave a better hit rate. All suggestions are welcome.

Yes, I also have had 9 losses in a row, but the 10th trade, of course, more than made up for all 9.

Guys, my thing is this: after years of trading both demo and live, of looking for systems that I could make work, I have come to the conclusion that I am simply not a good trader. It isn't that I can't stick to the rules of a system, I can, it is just that no system seems to be profitable for me in the long run.

So, I had to develop something that would allow me to NOT LOSE in the long run, hence the Martingale strategy. This would work fine if starting with very small lot sizes. Think of it this way, if starting with 100 units (.01 per pip) then you could have numerous losses, way more than the system produces, and still be a profitable trader. Not rich, for sure, just profitable.

timbobo
55
timbobo  
mikejody:
Yes, I also have had 9 losses in a row, but the 10th trade, of course, more than made up for all 9.

If you started with 0.1 of stardard lot (~$100) your profit will be about $50 per day. On other hand, even with that low start you'll need to open 102.5 lots in your 10th trade - more then 100K deposit!!!

So, you're are going to put 100K as deposit just to get $50 per day in average. Put your money into bank on savings account and you'll get much more with no risk at all.

mikejody
518
mikejody  
timbobo:
If you started with 0.1 of stardard lot (~$100) your profit will be about $50 per day. On other hand, even with that low start you'll need to open 102.5 lots in your 10th trade - more then 100K deposit!!! So, you're are going to put 100K as deposit just to get $50 per day in average. Put your money into bank on savings account and you'll get much more with no risk at all.

Might be better to start with 0.1 of a micro lot, if you don't have the funds.

Anyway, here are the results for February of 2006. WOW!

=============================================================================================

PERFORMANCE STATISTICS

=============================================================================================

TRADING PARAMETERS...........................................................................

Initial Account Equity: $3,000.00

Trading Vehicle: Futures

Initial Margin: $0.00

Round-turn slippage per contract: $0.00

Round-turn commissions and fees per contract: $0.00

Position Sizing Method: None

No. Contracts: From input data

PROFIT SUMMARY...............................................................................

Total Net Profit: $98.10

Gross Profit: $146.00

Gross Loss: -$47.90

Profit Factor: 3.0480

Highest Closed Trade Equity: $3,103.10

Lowest Closed Trade Equity: $3,000.00

Final Account Equity: $3,098.10

Return on Starting Equity: 3.27%

TRADE RESULTS................................................................................

Number of Trades: 20

Number of Winning Trades: 11

Number of Losing Trades: 9

Percent Profitable: 55.00%

Max Number of Contracts: 1

Minimum Number of Contracts: 1

Average Number of Contracts: 1

Largest Winning Trade ($): $22.00 (0.73%)

Largest Winnning Trade (%): 0.73% ($22.00)

Average Winning Trade ($): $13.27

Average Winning Trade (%): 0.44%

Max Number Consecutive Wins: 3

Largest Losing Trade ($): -$10.00 (-0.33%)

Largest Losing Trade (%): -0.33% (-$10.00)

Average Losing Trade ($): -$5.32

Average Losing Trade (%): -0.17%

Max Number Consecutive Losses: 2

Average Trade ($): $4.90

Average Trade (%): 0.16%

Trade Standard Deviation ($): $11.11

Trade Standard Deviation (%): 0.36%

Win/Loss Ratio ($/$): 2.4938

Win/Loss Ratio (%/%): 2.5137

Return/Drawdown Ratio: 6.6555

Modified Sharpe Ratio: 0.4443

DRAWDOWNS....................................................................................

Number of Closed Trade Drawdowns: 6

Average Drawdown ($): -$7.98

Average Drawdown (%): 0.26%

Average Number of Trades in Drawdowns: 1

Worst Case Drawdown ($): -$15.00 (0.49%)

Trade Number at Trough: 8

Number of Trades in Drawdown: 2

Worst Case Drawdown (%): 0.49% (-$15.00)

Trade Number at Trough: 8

Number of Trades in Drawdown: 2

timbobo
55
timbobo  
mikejody:
Might be better to start with 0.1 of a micro lot, if you don't have the funds.

If you start so low you'll never get funds. What the point to trade if your outcome is couple bucks per day only?

General idea about that indicator - Heiken Ashi smoothed.

It looks great on history but in real-time testing it is very slow, it can show you all trends but it will do it too late...

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