An advisor that is not afraid of a margin call. Who would like to try it out? - page 7
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Why not implement this approach in an EA? We calculate the most unprofitable, I mean the most negative positions from the current price...
When MarginLevel decreases, fix the loss with the minimum lot and if MarginLevel allows, then enter the market at a better price.
Did you try this approach?
It does not make any difference for equity if we close a loss-making position with n lots or profit one - this can be easily proved both analytically and empirically in the tester. Only the balance and margin level will change. If we close a losing trade the balance will be reduced by the amount of loss. And vice versa, if a profitable position is closed, the balance will increase exactly by the profit value of this very position. And since the balance does not play any role, there is no point in inventing senseless manipulations with it. If, as you put it: "entering the market at a more favorable price" would be really beneficial for equity, I would have implemented this method long ago. The margin level would go up after the close depending on the volume of the position.
What happens when there are a lot of open positions and the MC comes? DC first of all closes the most unprofitable positions... More margin is freed up...
About the margin call, the broker closes unprofitable positions completely, as soon as the margin level falls to the bar.
In other words, it does not adjust the level unlike this EA and does not close positions partially, but closes them all at once and for the entire volume, and with a fat slippage as well.
The idea of the Expert Advisor is to sit out the drawdown with minimal losses, i.e. to postpone the margin call to a VERY distant future...
Not only that. We also bring equity growth into the nearer future, i.e. the number of pips to grow the deposit as the market moves in our direction is significantly reduced.
Simply put, the market has to go against the grain by much more distance in pips for the deposit to decrease by n%, rather than going in our direction for the deposit to increase by the same n%.
It does not make any difference for equity if we close a losing position with n lots or a profitable one, as it can be easily proved analytically and empirically in the tester. Only the balance and margin level will change. If we close a losing trade the balance will be reduced by the amount of loss. And vice versa, if a profitable position is closed, the balance will increase exactly by the profit value of this very position. And since the balance does not play any role, there is no point in inventing senseless manipulations with it. If, as you say, "entering the market at a more favorable price" were really beneficial for equity, I would have done it a long time ago. The margin level after closing will go up depending on the volume of the position.
It does not make any difference for equity when closing a losing or profitable position.... But we are interested in the margin level, because this is our criterion for further placements ...
it makes a difference if we close a profitable or unprofitable position... in the latter case, more margin is released...
which position your EA chooses to close... what is the criterion... I'm a bit short-sighted... :) poke... I don't see it...
it makes a difference if we close a profitable or unprofitable position... in the latter case, more margin is released...
FION wrote :>>On the contrary, you should close a profitable position(or with a minimal loss), then the regulation will move to a higher MarginLevel and equity will tend to rise.
Before you say anything, try to make sure that your words are true. At least ask yourself how the margin level is calculated.
Why sign your own ignorance in a public forum?
You have made a clear nonsense. The margin level is calculated according to the formula below, not your fantasies and misconceptions:
MarginLevel = Equity * 100% / Margin
Where:
MarginLever - the margin level in %.
Equity - funds
Margin - total margin for all open positions
Margin itself at opening or closing positions in absolute value is calculated by the formula
Margin = Price * Lots * ContractSize / Leverage
where:
Price - current price at which the position is opened or closed
Lots - volume of opened position in lots
ContractSize - contract size, i.e. 1 lot
Leverage - leverage
As it can be seen from the above, the presence of profit or loss does not affect the margin, but only the volume.
Therefore there is no difference whether we close (or close partially) a losing or profitable position on the same volume at Price, because the margin increase in both cases will be exactly the same.
It is clear that it makes no difference which position to close in order to regulate margin level. I propose to decrease this level by increasing a position in the direction of increasing pair, and to close partially a pair with decreasing profit when the level decreases.
Grandpa Krylov's fable called "The Quartet": "No matter how you guys sit down, you're no good as musicians".
What is the point of your "rationalization" suggestions if nothing changes or depends on them?
Grandpa Krylov's fable called "The Quartet": "No matter how you guys sit down, you're no good as musicians".
What is the point of your "rationalisation" proposals, if nothing changes or depends on them at all?
You want to increase equity in the process, otherwise what is the point of playing?
Before you say anything, try to make sure that what you say is true. At least ask how the margin level is calculated.
Why sign your own ignorance in a public forum?
As you can see from all of the above, the presence of profit or loss does not affect the margin in any way, only the volume.
Therefore, there is no difference whether we close (or close partially) a losing or profitable position on the same volume at Price, because the margin increase in both cases will be exactly the same.
I admit my mistake. We are all just learning...