Martingale vs. Non Martingale (Simplified RoR vs Profit and the Illusions) - page 2
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Martingale, Hedging and Grid
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AmiBroker : converted from/to - the thread
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Forum on trading, automated trading systems and testing trading strategies
Trading: What is Martingale and Is It Reasonable to Use It?
Proximus, 2013.08.24 03:00
It works if the net profit factor is above 1 and the win rate is higher than 50%, martingale is a double or nothing either doubles your money or doubles your losses, so if you have a 60% win rate with 1:1 RR ratio you can use it safely, if not then dont.
Whats funny about forex that you dont start from 50% win rate from the start because the market is changing not a fix probability set like a roulette or blackjack game.So if you start it like a betting system you will have like 40% win rate with 1:1 RR if you take trades random, maybe on the 9999999999999999999999th trade you hit 49.9% but thats still not enough.So it is better to filter out crappy trades first and then increase your win rate to be martingale compatible! And this is the advantage of investing vs gambling, you can filter out bad trades, on the roulette or blackjack you cant filter out bad hands or spins unless you cheat, but surely not the statistical way!!
This is how my 60% win rate, real martingale system looks like, and how it should suppose to look like, on LEVEL 7 settings (2^7)
Here are my martingale type systems:
1) CLASSICAL MARTINGALE AFTER 567 TRADES (60% WR, 1:1 RR)
As you can see after 500 trades it barely hit LEVEL 7 and even if we would lost that we would lose only half of the profit and continue from there to grow it back!
Of course you need a big account for this like one that can support like 10 lot size trades to be only 1% account risk, but statistically its very improbable to blow your account since its only 1% risk versus huge potential gains...The martingale presented in this article is BS with like 40-45% win rate which is sadly not enough, not even 50% is, must be 51 or higher...
2) PROGRESSIVE DYNAMIC GROWTH MARTINGALE (60% WR, 1:1 RR)
3) PROGRESSIVE STATIC GROWTH MARTINGALE (60% WR, 1:1 RR)
4) ANTI MARTINGALE or INVERSE MARTINGALE (60% WR, 1:1 RR)
enjoy and good programming ;)
VIDYA N Bars Borders Martingale - expert for MetaTrader 5
The EA receives signals from the custom indicator 'VIDYA N Bars Borders'. Before executing a trading signal, the EA checks the current profit - if the profit is negative, then the signal is executed with an increased lot (the 'Position Increase Ratio' setting works).
I'd disagree with you! If a person has an edge, those are the people who should be using martingale, as simply having an edge refers to an entry not being 50/50. I for one believe that I have an edge because my system doesn't experience more than 3 straight losses. With that said, and not knowing which of the 3 orders will be the winner, I use martingale to end the sequence of trading with net profit. Most people believe that after a loss, your chances of winning on the next trade increases, but that isn't true unless your system, over time, has demonstrated to not experience x amount of losses. Then and only then can you use martingale effectively!
very true.
Modified Grid-Hedge EA in MQL5 (Part I): Making a Simple Hedge EA
Are you looking to dive into the world of trading with Expert Advisors (EAs) but keep bumping into this line - "No dangerous Hedging/Grid/Martingale used"? You might wonder what's all the fuss about these strategies. Why do people keep saying they're risky, and what's the real deal behind these claims? Maybe you're even thinking, "Hey, can we tweak these strategies to make them safer?" Plus, why do traders bother with these strategies in the first place? What's good and bad about them? If these thoughts have crossed your mind, you're in the right place. Your search for answers is about to end.
We'll start by creating a simple hedge Expert Advisor. Think of it as the first step towards our bigger project - a Grid-Hedge Expert Advisor. This will be a cool mix of the classic grid and hedge strategies. By the end of this article, you'll know how to whip up a basic hedge strategy and get the lowdown on whether this strategy is as profitable as some say.
Modified Grid-Hedge EA in MQL5 (Part II): Making a Simple Grid EA
Modified Grid-Hedge EA in MQL5 (Part III): Optimizing Simple Hedge Strategy (I)
Welcome to the third installment of our "Optimizing a Simple Hedging Strategy" series. In this segment, we'll begin with a brief review of our progress to date. So far, we have developed two key components: the Simple Hedge Expert Advisor (EA) and the Simple Grid EA. This article will focus on further refining the Simple Hedge EA. Our goal is to improve its performance through a combination of mathematical analysis and a brute force approach to find the most effective way to implement this trading strategy.
This discussion will focus primarily on the mathematical optimization of the Simple Hedge strategy. Due to the complexity and depth of the analysis required, it is impractical to cover both the mathematical optimization and the subsequent code-based optimization in a single article. Therefore, we'll devote this article to the mathematical aspects, ensuring a thorough exploration of the theory and calculations behind the optimization process. In subsequent articles of the series, we will shift our focus to the coding aspect of optimization, applying practical programming techniques to our theoretical foundations established here.