The market is a controlled dynamic system. - page 96

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avtomat:
The road is for those who walk.
For me, the mathematical road is the road over stones with my bare heels. A different mindset, rather analytical, logical, moronic at last... but not mathematical. If I really needed anything, I went to Alexei(Mathemat) for a bow...
 

I will make a small adjustment to the formula for calculating efficiency - to allow for changes in the prevailing conditions.

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With such a formulation, the essence of the trader's effectiveness is expressed more precisely.

If, for example, for the whole period under consideration

1) no funds are withdrawn, and the balance value does not change, the efficiency of such operation equals zero

2) I did not withdraw any money, and the balance doubled, the efficiency of such work will be 100%.

3) funds withdrawn are equal to contributed funds and the balance size remained unchanged; the efficiency of such operation equals 100%

4) Withdrawal of funds equals to deposited funds and the balance doubled, the efficiency of such operation equals 200%

5) no funds have been withdrawn and the balance value has fallen to zero; the efficiency of such operation equals -100%

6) Withdrawals are equal to contributed funds and the balance value has dropped down to zero - the efficiency of such activity is equal to zero

etc.

 
avtomat:

I will make a small adjustment to the formula for calculating efficiency.


The market is a controlled dynamic system.
 

For example, the deposits of tractors A and B, in addition to the initial 500, were replenished with 200 each -- as a result they have 700 each

So at this point their efficiency (current value) is:

.

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avtomat:

For example, the deposits of tractors A and B, in addition to the initial 500, were replenished with 200 each -- as a result they have 700 each

So at this point their efficiency (current value) is:

.

.

I recommend that you forget about the word "balance", consider only "equity" (means) and give equations reflecting the dynamics of trading from this point of view. The balance can be given as an abstract figure which does not mean anything and is not emphasized. Balance is nothing, funds are everything (c).
 
yosuf:
I would recommend we forget about the word "balance" and consider only "equity" (means) and present equations reflecting dynamics of trading from this very point of view. The balance can be given as an abstract figure that does not mean anything, and you do not have to focus on it. Balance is nothing, funds are everything (c).


I don't agree with this twist.

First, only the withdrawn funds ("cache") are materialised. Second, both "balance" and "equity" are virtual. However, if the "balance" is virtual, then the "equity" is virtual twice as much, if I may say so ;)

 
avtomat:


I disagree with this twist.

First, only the withdrawn funds ("cache") are materialised. Second, both "balance" and "equity" are virtual. However, if "balance" is virtual, then "equity" is doubly virtual, if I may say so ;)

However, it is by "doubly virtual" equity that Nikolai Morzhov comes in... in no way by "just virtual" equity.
 
artmedia70:
However, it is by "doubly virtual" equity that Nikolai Morzhov comes in... in no way just by the "virtual" balance.


Nikolai Morzhov, however, comes by the balance. The very fact of his arrival is, so to speak, a lowering of the degree of virtualisation ;)
 
avtomat:

Nikolai Morzhov comes in on balance after all. The very fact of his arrival is, so to speak, a downgrading of virtualisation ;)
No. Not by balance. The balance may be less than MarginCall, but if there is a surplus of funds (there are uncovered positions in surplus), then there is enough to support open positions and collateral funds. After closing all such positions, the balance will increase to equity. Not vice versa - the balance may be a billion-dollar, but if there are insufficient funds to maintain open positions (there are uncovered positions in deficit) and funds have reached the MarginCall level, then without urgent account replenishment to raise funds to the minimum level for maintaining open positions, the brokerage company begins to close loss-making positions to release margin funds, so that these funds will be sufficient to maintain other open positions. In this case the balance will fall upon closing another losing position. When closing them all, the balance will drop to equity. This is how StopOut comes. Exactly on the equity value.
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