Rafael Grecco Strategy
- "Hedging" in Forex trading -Why do it?
- MT5 Strategy Tester
- Why different result on strategy tester?
I am actually testing a EA that uses both hedging and martingale (and averaging) with controlled risks.
The main point is: control your risks.
Using either hedging or martingale without control will make you lose money.
Just an example of my current EA that uses hedge and martingale:
Those drawdowns are locked at 10%.
I have a demo account running it live right now on a signal, but is too new to see how it behaves on the long term. I think I'll create a new thread to discuss how we can control our losses when using hedging/martingale/averaging.
In my opinion, hedge can be properly used to make money. I personally don't use hedge on my manual trades, but I do use it on EAs.
I am actually testing a EA that uses both hedging and martingale (and averaging) with controlled risks.
The main point is: control your risks.
Using either hedging or martingale without control will make you lose money.
Just an example of my current EA that uses hedge and martingale:
Those drawdowns are locked at 10%.
I have a demo account running it live right now on a signal, but is too new to see how it behaves on the long term. I think I'll create a new thread to discuss how we can control our losses when using hedging/martingale/averaging.
In my opinion, hedge can be properly used to make money.
I don't see how it affects "hedging" ?
Margin.
I am actually testing a EA that uses both hedging and martingale (and averaging) with controlled risks.
The main point is: control your risks.
Using either hedging or martingale without control will make you lose money.
Just an example of my current EA that uses hedge and martingale:
Those drawdowns are locked at 10%.
I have a demo account running it live right now on a signal, but is too new to see how it behaves on the long term. I think I'll create a new thread to discuss how we can control our losses when using hedging/martingale/averaging.
In my opinion, hedge can be properly used to make money. I personally don't use hedge on my manual trades, but I do use it on EAs.
Hi @Rafael Grecco ! Long time no read !
Well, Rafael is one of those who sublimated that strategy btw how is your EA doing Rafael, as I remember already 3 months you started it ?
I can say you how it behaves on the long term...but I suppose every one has to make his own experience.
I have already been there and I learned from my mistake. That's why I am saying: with the correct risk control, it does work.
Margin.
Hi @Rafael Grecco ! Long time no read !
Well, Rafael is one of those who sublimated that strategy btw how is your EA doing Rafael, as I remember already 3 months you started it ?
Hey Icham! How are you doing?
Yeah, I guess a little more than 3 months since that first time we discussed our EA development.
I found a way to control risk: my max DD% is currently at 10%.
When a pair reaches maximum DD% (that is 10%), that means the current market condition on that pair is not good for the EA and it will close the trades on that pair and will not open new trades on it.
Then the EA analyse all other pairs and those that are currently running fine a giving steady profit (that means, current market condition is favorable for the EA) and will slightly increase lot sizes to recover the loss from the other pair. When the loss is recovered, lot size will return to standard size.
The pair that reached the maximum DD% will only start to trade again after market has changed behavior and a reoptimization is done for the selected period.
I'll probably open a new topic soon to discuss those new strategies with whoever is interested. Let's not derail this topic more than it has already derailed.
Best regards.
I have already been there and I learned from my mistake. That's why I am saying: with the correct risk control, it does work.
Hey Icham! How are you doing?
Yeah, I guess a little more than 3 months since that first time we discussed our EA development.
I found a way to control risk: my max DD% is currently at 10%.
When a pair reaches maximum DD% (that is 10%), that means the current market condition on that pair is not good for the EA and it will close the trades on that pair and will not open new trades on it.
Then the EA analyse all other pairs and those that are currently running fine a giving steady profit (that means, current market condition is favorable for the EA) and will slightly increase lot sizes to recover the loss from the other pair. When the loss is recovered, lot size will return to standard size.
The pair that reached the maximum DD% will only start to trade again after market has changed behavior and a reoptimization is done for the selected period.
I'll probably open a new topic soon to discuss those new strategies with whoever is interested. Let's not derail this topic more than it has already derailed.
Best regards.
This last one is brightful : there is more losses than in firsts versions, but it's much more well controled and recovered !
Are you talking of self reoptimization ?! How do you do it ? As I remember last time we meet on the forum you were talking of a 10-years optimization plan !
This is a topic about hedging, please stay on topic.
@Keith Watford I let you decide to keep or not the off-topic posts.
This is a topic about hedging, please stay on topic.
@Keith Watford I let you decide to keep or not the off-topic posts.
Thanks Alain. I moved them here (obviously).
This last one is brightful : there is more losses than in firsts versions, but it's much more well controled and recovered !
Are you talking of self reoptimization ?! How do you do it ? As I remember last time we meet on the forum you were talking of a 10-years optimization plan !
there is more losses than in firsts versions, but it's much more well controled and recovered !
The smaller the acceptable loss, the more times it will happen. If we set a maximum DD% of 50% for example, it would happen a lot less, but the loss would take a looong time to recover. I think that 10% is an acceptable risk and recovers quickly.
Also, that graph is an ugly aproximation of what to expect. The graph is running a single set of parameters during 4 or 5 years. It does not self reoptimze (that would be great!).
As I remember last time we meet on the forum you were talking of a 10-years optimization plan !
After reading a lot about walk forward analysis (WFA), I ran it on my EA using a reoptimaztion of the last 12 months each 3 months and it worked perfectly fine.
IF a pair reaches 10% DD it will stop. Then I will manually reoptmize it for the last 12 months. The EA will "lockdown" the pair until it thinks the pair is ready again to be traded (that is, market has left dagerous area) and then I will have to manually activate it again if I also think it is ready.
A 10% DD rarelly happens more than once a year in each pair (it usually runs 2 or 3 years without reaching that DD level), so overall, it seems it will make good profit with controlled risk.
The worst case scenario would be 2 or 3 pairs reaching 10%DD at once, which is very very unlikely, but even if that happens, thats 30% DD, better than a lot of EAs around.
EDIT - Sorry, I accidentally deleted this, Keith
Thank you very much for creating a new thread for me and sorry for derailing your thread, it was not my intention.
Thank you very much for creating a new thread for me and sorry for derailing your thread, it was not my intention.
No worries.
Let me know if you want the thread title changed.
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