Is risk diversification even possible in the forex market? - page 6
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But then, as far as I can see, this would not be diversification anyway.
Look:
For example, I decide to trade aggressively - 10% of risk (of deposit) for 1 transaction.
I take 5 symbols linked to the quid and it turns out that if the general quid chart does not move in my direction - then I lose 50% at once!
Isn't it so?
I'm going to take a portfolio (as I see) while looking at this general graph?
P.S. If I order not 50% (in 5 positions, but for example 2% on each tool in my portfolio), then there is no point in this manoeuvre, because I can trade with the same success on 1 instrument (any) at a time...
(having the same risks and the same potential profit)
What does the dollar index have to do with it? The dollar index is just a currency, not a currency pair.
The SP500, on the other hand, is a set of all the stocks that are traded. And the main trick of market-neutral strata is to highlight the alpha, because you can get the beta just by buying the index.
1 pair with 10% risk and 5 pairs with 10% risk each do not qualify as diversification. It is simply an increase in risk, not an allocation. Diversification in your case is 5 pairs at 2% each. Diversification is not an increase in profit, but reduction of risk, which generally leads to lower profits, but the end result can be better.
The essence is simple.
Or I make 10 trades in 10 days.
(Each trade at 10% risk and lasts 1 day.)
Or I make 10 trades in 1 day.
(with the same risk per instrument.)
Here I want to understand whether it is possible to trade 10 instruments per day and the risks would be as distributed (in terms of diversification), as if I trade these 10 positions - 10 days?
In other words - I want to load my entire deposit every day (or at least 30% of it).
In short, the deposit must work and not just be for show.
Do you get the idea?
How this can be achieved?
(And whether it is possible to organize it in the forex market?)
See.
The bottom line is simple.
Either I make 10 trades in 10 days.
(each trade at 10% risk).
Or I make 10 trades in 1 day.
(with the same risk per instrument.)
Here I want to understand whether it is possible to trade 10 instruments per day and the risks would be as distributed (in terms of diversification), as if I trade these 10 positions - 10 days?
In other words - I want to load my entire deposit every day (or at least 30% of it).
In short, the deposit must work and not just be for show.
Do you understand the idea?
If you trade 10 trades every day, you are quickly gaining a statistically significant number of observations. If your TS has positive MO, it is more likely to show up on a large number of observations (law of large numbers in a twisted form).
If you trade 10 trades every day, you are quickly gaining a statistically significant number of observations. If your TS has positive MO, it is more likely to show up on a large number of observations (law of large numbers in a twisted form).
Which observations exactly are we talking about?
And what exactly are you driving at?
(what do you propose to do I mean?)
Can you rephrase it? )
What kind of observations are we talking about exactly?
Your TS does not give 100% profitable trades, right? Some of the trades are + and some are -. The main thing is that at the end of a certain period the total amount of trades will be +. Trading 10 trades every day in your example, you'll get that period faster.
Well, if the TS really gives positive results.
Your TS does not give 100% profitable trades, right? Some of the trades are in the +, some are in the -. The main thing is that at the end of a certain period the total amount of trades will be +. Trading 10 trades every day in your example, you'll get that period faster.
Well, if the TS really gives positive MO
But how to trade 10 trades a day - if it's risky to hold all your positions at once in the forex market?
(That's what my main question of this post is...)
Yes. Exactly.
But how can you trade 10 trades a day - if it's risky to hold all your positions at once in the forex market?
(That's what my main question of this post is...)
It is less risky (in terms of loss) to open ten trades in 10 instruments at the same time than to open one trade in one instrument. Provided that there are real signals to open.
The probability of an eagle (loss) falling on a coin flip is 50%.
The probability of tossing 10 pennies to get 10 eagles is less than 50%.
Right?
Look.
The bottom line is simple.
Either I make 10 trades in 10 days.
(Each trade is 10% risk and lasts 1 day.)
Or I make 10 trades in 1 day.
(with the same risk per instrument.)
Here I want to understand whether it is possible to trade 10 instruments per day and the risks would be as distributed (in terms of diversification), as if I trade these 10 positions - 10 days?
In other words - I want to load my entire deposit every day (or at least 30% of it).
In short, the deposit must work and not just be for show.
Do you get the idea?
How this can be achieved?
(And whether it is possible to organize it in the forex market?)