Terminator v2.0 - page 33
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I've just been thinking about a new way to trade this type of strategy that I believe would be very helpful in reducing the risk of blown accounts. Here's the idea in a nutshell:
When the market moves against your initial position, instead of adding a new doubled position on top of the previous position, close the previous position at a loss when the new one is added.
I thought of this idea because it is closer to the original Martingale concept - where the doubled trade (bet) is made after taking a loss, and is designed to cover the loss and still provide profit. In Terminator/Predator/etc., all losing positions are held until finally a position wins. Since the majority of margin used is the initial margin, that means you're twice the margin you need to to keep all these positions open. Consider this comparison.
With Term/Pred/etc.:
one trade = 1 margin
two trades = 3 margins
three trades = 7 margins
four trades = 15 margins
five trades = 31 margins
six trades = 63 margins
but with my idea:
one trade = 1 margin
two trades = 2 margins
three trades = 4 margins
four trades = 8 margins
five trades = 16 margins
six trades = 32 margins
With a Pips setting of 20, you would make a profit of 1380 pips (based on the initial trade size) with Term/Pred/etc. but you'd make 660 pips with my idea. That means with my idea you'd use about half the margin, and make about half the profit. Considering your account could now withstand twice as large a move against you without crashing, I think that accepting a 1/2 reduction in profits to be quite acceptable. I will try coding up an example when I get a chance, but I'm interested in what others think of this idea...
Sharp thinking
I've just been thinking about a new way to trade this type of strategy that I believe would be very helpful in reducing the risk of blown accounts. Here's the idea in a nutshell:
When the market moves against your initial position, instead of adding a new doubled position on top of the previous position, close the previous position at a loss when the new one is added.
I thought of this idea because it is closer to the original Martingale concept - where the doubled trade (bet) is made after taking a loss, and is designed to cover the loss and still provide profit. In Terminator/Predator/etc., all losing positions are held until finally a position wins. Since the majority of margin used is the initial margin, that means you're twice the margin you need to to keep all these positions open. Consider this comparison.
With Term/Pred/etc.:
one trade = 1 margin
two trades = 3 margins
three trades = 7 margins
four trades = 15 margins
five trades = 31 margins
six trades = 63 margins
but with my idea:
one trade = 1 margin
two trades = 2 margins
three trades = 4 margins
four trades = 8 margins
five trades = 16 margins
six trades = 32 margins
With a Pips setting of 20, you would make a profit of 1380 pips (based on the initial trade size) with Term/Pred/etc. but you'd make 660 pips with my idea. That means with my idea you'd use about half the margin, and make about half the profit. Considering your account could now withstand twice as large a move against you without crashing, I think that accepting a 1/2 reduction in profits to be quite acceptable. I will try coding up an example when I get a chance, but I'm interested in what others think of this idea...Now that's sharp thinking ZTrader, I like it. It may be better than my thinking that; As each position is added and doubled, instead of keeping the pip step the same, increase the pip step size. Example: First position open .1 lot, 2nd open .2 lot at 20 pips, 3rd open .4 at 35 pip, 4th open .8 lot at 50 pip etc. But it doesn't improve margin stance as yours does. Kevin
On further thought, it's not so beneficial as I'd indicated... you'd lose half of your profit, but you'd only be able to go one trade deeper than before...
Seemed really good at first, though..
Update
Terminator_v2.02
Hi kjenkins ,
Can you please give me the link of the broker of your statement.
Thanks
Fast_cris
Hi kjenkins ,
Can you please give me the link of the broker of your statement.
Thanks
Fast_crisSure...FXLQ.com
This thread died quick.
Terminator
OK Bluto, point taken. I have included a screenshot of part of my Demo statement. Around the middle you will see a hefty gain of over $1,000 made by Terminator. The other losses of 300 plus were made by the others.
I put them all on the tester under the same conditions and Terminator was the ONLY one to have a perfect straight line of 77,000+ gain from 10k. I know the Tester is not the best place to make a decision but its a start. Predator was a bit bumpy and not bad until the last 2 months, when it started losing big-time, to the tune of $2500 about 4 times in a row, wiping out some nice gains.
In forward testing on a demo, Predator neither lost nor gained overall. All gains it made it lost them just as quickly. Sometimes I could not see the logic in the positions it opened. I had to wait days for a correction then the gain or loss would be small. So in effect, to me, Predator wasted a lot of valuable time. Time is monney.
The others were similarly tested and the only consistent one with fair gains was Terminator. Am not trying to put the others down, am just stating my opinion based on my results. I never manually closed positions because I wanted the EA to do the work for me.
If an EA does not make money, to me its toast!
Regards.
Pipsqueak2