What’s the worst strategy you’ve ever traded? - page 4
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The Martingale strategy is for the streets 😆
But I do have one martingale code which is reasonable as it religiously follows RSI/Moving average signals instead of just betting on a win. Anything that goes beyond 45% drawdown isn't good enough. Many brokers forcefully close positions if 50% drawdown is reached
In my case a tried a trading equal highs with an EA and it didn't go well.m
Martingale. It made me cry when I was a newbie 😂😂
Grid, martingale, average price.
These are operational methods where you will always have mathematics on your side.
You will always have to have active management over the EA in question, and that's why it's counterproductive.
I much prefer EAs that give me peace of mind and don't require me to worry about the account going broke on the next trade.
As a trader, I believe that having mathematics, statistical probability on your side, is absolutely fundamental for long-term gains.
Most markets are mean-reverting rather than trending. This makes averaging a perfectly viable trading tool. However, it is a very sharp tool that requires skill and adaptation to avoid getting 'cut' by it;)
But overall, the probability of a return is slightly above 0.50.
Most markets are mean-reverting rather than trending. This makes averaging a perfectly viable trading tool. However, it is a very sharp tool that requires skill and adaptation to avoid getting 'cut' by it;)
Then why not simply trade a mean reversion strategy without all of the averaging hoopla? We all probably know that FX markets range about 70% of the time on any timeframe. It's refusing to accept a loss that blows accounts.
But overall, the probability of a return is slightly above 0.50.
So, that means that the probability of a loss is slightly below 50%. It beats a coin toss, I suppose.
I agree, taking a loss is rule number one, and it's genuinely painful. Which is why it's the most neglected rule.
Averaging provides recovery speed and tangible profits. The further the price deviates from the mean, the higher the probability of a reversal, making a larger position very appropriate at that stage.
And you're right, the strategy must be profitable even without averaging, otherwise, it'll never take off.