Once again, about the lokas. - page 5
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Opponents of lock (hedging) do not know what to make of it. Supporters intuitively understand its benefits. Only a few both understand and know what to do.
The paradox is that on a domestic level, almost everyone uses locs. You have bought goods on credit or taken out a loan. These are all examples of loca. When you receive goods, services or money, you commit to repay the money over time, i.e. you minimise the risk to your budget.
Lock is the deferred taking of a profit or loss.
What does this mean? We urgently borrow money that we have not yet earned and we have yet to pay it back. In everyday life, we pay back borrowed money in instalments. Hence the conclusion: the volume of positions should be divided into several parts (the more of them, the safer for the deposit) in order to minimize the risks. You should close a position, when the price is outside a lock, and at least it has the same width .
For example, we got a losing position for 100 points, and the volume is 10 lots. We have 10 attempts to close the position. The price is outside the position and repeats its width - 100 points. We fix profit of 1 lot (+100 points). Loss position 1 lot gives -200 pts.
2 options:
1. The price reversed, passed 100 p - half way to the opening price of the losing position. We fix the losing position in the volume of 1 lot. Total: 100 - 100 = 0 p.
2) The trend continues. The price has already passed 200 p. Fix the profit of 1 lot (+200 p). A loss position of 2 lots gives -300 p. The price reversed, passed 150 p - half the distance to the opening price of the loss position. We fix the losing position in the volume of 2 lots. Total: 100 + 200 - 2*150 = 0 p.
....
If the trend continues and reaches 1000 pips, we fix the last profitable position in the volume of 1 lot and place the lot. The equity loss will increase 1.5 times. The width of the lock is 1100 p. Once the price passes 100 p in either direction, we set a new lock.
If the lock is positive, we set the same rules.
The price is outside of the position and repeats its width - 100 points. Fix profit of 1 lot (+200 points). A losing position of 1 lot gives -100 pips.
2 options:
1. The price reversed and travelled 50 p - half way to the opening price of the losing position. We fix the losing position in the volume of 1 lot. Total: 200 - 50 = 150 p.
2) The trend continues. The price has already passed 200 p. Fix the profit of 1 lot (+300 p). A loss position of 2 lots gives -200 p. The price reversed, passed 100 p - half the distance to the opening price of the loss position. We fix the losing position in the volume of 2 lots. Total: 200 + 300 - 2*100 = 300 points
Thank you for your detailed reply on the subject. I do not understand everything, unfortunately, due to my poor judgement. If the trend always continues, the lock remains and the equity loss increases by 1.5 times, what is the effect of such actions?Such an algorithm exists. The risks are minimal, but so are the profits. Not more than 20-30% per annum on one currency pair. Even if you increase the number of currency pairs to 10-20, it will not be worth it (your time, effort), if your initial deposit is less than 10,000. Mine is 10 times less, so it is shelved for now. I will not give an example of the algorithm, as well as prove something, think of it as rubbish and bluster.
Isn't the algorithm you mention a relative of the algorithm described in the "avalanche" thread?
Противники лока (хеджирования) не знают, что с ним делать. Сторонники интуитивно понимают его пользу. Лишь единицы и понимают и знают, что делать.
Парадокс в том, что на бытовом уровне, практически, каждый пользуется локом. Вы купили товары в кредит или взяли заем. Это все примеры лока. Получая товары, услуги или деньги, вы берете обязательства вернуть денежные средства с течением времени, т.е минимизируете риски для вашего бюджета. ерам при разб
No, no, no!
On a domestic level, a lock is as follows:
1) You take a loan from the bank, for example at 18% (this is a negative swap :) ) and you pay a fee to open an account (this is a spread :) )
2) you deposit the money you get from the bank into the same bank, at 10% interest (this is a positive swap).
3) You think about how you can make profit in this situation, and the bank profits from the interest difference :)
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So it is reasonable to ask: "Why is the Lock structure so survivable?
Personally, I see several advantages of using lock (of course, each plus for its target group of traders):
1) increase in average time of holding an open position (important for scalpers in case of dealing with DC);
2) it is more comfortable to look at losses, feeding yourself with the illusion that everything is going to improve;
3) an opportunity to hide from investors a fact of a drawdown, sometimes critical (it is important for scammers).
And so, if you put aside the selling of a smooth balance curve to the investor, it's mostly psychological comfort.
Nothing against locs, but I don't use them. There's no point. And I've never used one. What the hell kind of locs on FRR?
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But in general, spring will be over sooner or later and the number, I would even say, the flood of amazing posts will return to normal. Maybe I'll take a break from visiting the resource. Health of mind is more important.
1) увеличение среднего времени удержания открытой позиции (важно скальперам в случае разборок с ДЦ);
Here, by the way, the way out of the loca is obvious - OrderCloseBY() after the planned hold.
1) increase in average time of holding an open position (important for scalpers in case of disputes with DTs);
Since some time brokerage companies became more cunning (maybe not all of them) and now calculate the lifetime of scalper position from its opening to closing OR to opening of opposite (locking) position.
And this point is prescribed in the regulations. So the advantage is no longer valid.
Нет, нет, нет!
На бытовом уровне лок выглядит следующим образом:
1) Вы берете у банка кредит, например, под 18% (это отрицательный своп :) ) при этом платите за открытие счета нек. сумму (это спред :) )
2) Вы кладете полученную от банка сумму в этот же банк под 10% (это положительный своп)
3) Вы думаете как в сложившийся ситуации извлечь прибыль, а банк тем временем имеет Вас на разнице в процентах :)
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In this regard, I would like to ask, why was it necessary to try to explain something by giving obviously incorrect and inappropriate examples? Defenders and opponents of the locus seem to mock those around them with their discussions, never attempting to consider the totality of the facts.But what is written with the stylus .... and self-deception begins, like there were many trades and the balance is crawling upwards and the equity is approaching zero, so you have to wait it out or block it.
We have to remove the column and call the equity balance
В этой связи хотелось бы спросить, зачем нужно было пытаться что-то объяснять приводя явно некорректные и несоответствующие ситуации примеры? Защитники и противники локов как будто бы издеваются над окружающими своими обсуждениями, никогда не пытаются рассматривать всю совокупность фактов.You should address your questions to kharko about incorrectness.
Насчет некорректности Вы kharko вопросы адресовывайте.
Why should I? However, the question is off the table. I can see that you don't see any mistakes in your examples and are unlikely to want to admit them :)