Simple hedging system...

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hello,

i've a strategy but it still unperfect

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Rules

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buy and sell on daily open price everday...

i suggest to put hedge position at -15 loss position

for example

close price : 1.1900

so it will open buy at 1.1902 (spread : 2) (order #1)

open sell at 1.1900 (order #2)

then the price raises to 1.1915

it will open buy position at 1.1915 to lock the Order #2

the best scenario is eurusd still raise until closed at 1.2000

i will get 85 pips (the position wil force-closed every 00:00). with locked loss -15, so it gives 70 pips profit.

the second scenario is

the price moves up to 1.2000 then fall to 1.1800,

i suggest to use trailing stop/stepping take profit (profit 30 lock 15, profit 60 lock 45)..

it will gives about 85 from buy position and 100 pips from sell position, minus 2x -15 = 185-30 pips = 155 pips (in a day).

the worst scenario, is the price ranging at 1.1915

if i use an EA, it will open-close-open-close that will cost huge spread. i wonder if there any technique to solve that.

notes: if the hedge position was opened, then the price reverse, it will be closed, and if the price reverse again, it will openede again.

basicly, i want to lock -15 pips loss by hedge it.

basicly, i want to loss around 15-30 pips only... but i will get a huge loss from spread.

any suggestion ?

thank you

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23 feb 06

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attached pic,

open buy** & sell*** at 00.00

then price going up, open another buy position*

then price reverse, then close that buy position*

up & down at the open-line

then moving up again, open another buy position*

until buy** reach 50 pips, maybe we should close the position ?...

then moving down... buy position* should be closed

lower and lower until open-15pts should be open a sell position **** to hedge buy** position, but if the buy position** was closed, you don't need to open a sell position

then the price going up... the sell position **** should be closed (if opened)

raising and raising, then open buy position ***** , then close again *****

then the day ends, profit :

50 pips from the closed buy position **

20-25 pips loss from the sell position * (forced closed)

hope it will clear my strategy

 

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Hi white_tiger

Have you used this system before?

This strategy seems interesting to me but I have to look more into it.

I am very interested in this "mathematical" strategies.

Please tell me if you have used this strategy (and give me the results).

I will try to improve this system... . I'm thinking maybe using a Moving Average (on Open Price) to avoid repeated open-close-open-close by the EA.

I will keep you informed on this.

 

i never test... idea about this system just come few hours ago ....

i just look the past chart, and seems profitable...

i also haven't calculated how many spreads will eat my profit for each day

 

Hi

I have just created an indicator (in fact, I modified other indicator) to plot a Daily Open horizontal line. This way it will be much easier to check this system.

Files:
dayopen.mq4  3 kb
 

I can't figure it out, white_tiger

I'm sorry white_tiger, but it seems that this system isn't as good as we thought. ...

If I can figure out something, I will post here.

Good luck and good trades!

 
 

thanks for indicator, btw you can also use indocators called "hedgetest" at the brunoFX's link.

I will post here.

i'm waiting your post.

 

I also like hedging and mathematically based strategies. A lot of people will say that hedging will only bring ruin eventually. I disagree. I think a proper hedging system can be quite powerful and effective. I am convinced that it is possible to develop a successful strategy that involves hedging. Hopefully we can work together here to try and do that.

 

see the updated.

 

Hedging on Euro and NY open

Thanks for the indicator and the strategy.

I am wondering if the indicator can be modified so that the strategy can be tested on Euro and NY open.

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