Spread decide how much trader lose over 10000 trades no matter strategy used
Mathematically formula for 10 pips profit, 10 pips stop loss.
1-10/(10+10)=0.50
In 10000 trades there will be 5000 wins and 5000 stop loss hit.
profit = 5000*1$ profit - spread 1 pips*5000 trades = 45000$
loss= -5000*1$ + spread 1 pips*5000 trades = - 55000$
profit - loss = -10000$
for traders loss will be always higher then profit.
Cut loses let profit run do not work (stop loss 10 pips profit 100 pips)- mathematically 1-10/(10+100)= 0.90
stop loss will be hit 90% trades or 900 times in 10000 trades. 100 pips profit will be hit 10% or 100 times in 10000 trades and spread destroys all profit.
Martingale do not work - mathematicaly in 10.000 trades there will be 13 progression (10000*0.50*0.50...)to double money (from 0.01 to 40.96 lots) In 100000 trades there will be 16 progression (from 0.01 to 327 lots). In 1000000000 trades there will be 29 progressions to double money (from 0.01 to 2684355 lots). 29 progression can come any day to blow up bank (it doesnt count from today when progression will come and ea are unpractical)
in roullete is same situation spread eats all profit, in sports betting (adrian massey website has data on horse racing spread 10% )spread eats all profit no matter strategy, teams or combination. so trader can calculate how much is loss connected to number of trades.
only way to beat roullete is to find over long series of numbers number (months) which repeats more often then 1 in 36 and to play that number constantly.
In forex to beat spread need to find more sell orders then buy orders over long period of time (month) to overcome spread. shorth term will not apply.
Mathematically formula for 10 pips profit, 10 pips stop loss.
1-10/(10+10)=0.50
In 10000 trades there will be 5000 wins and 5000 stop loss hit.
profit = 5000*1$ profit - spread 1 pips*5000 trades = 45000$
loss= -5000*1$ + spread 1 pips*5000 trades = - 55000$
profit - loss = -10000$
for traders loss will be always higher then profit.
Cut loses let profit run do not work (stop loss 10 pips profit 100 pips)- mathematically 1-10/(10+100)= 0.90
stop loss will be hit 90% trades or 900 times in 10000 trades. 100 pips profit will be hit 10% or 100 times in 10000 trades and spread destroys all profit.
Martingale do not work - mathematicaly in 10.000 trades there will be 13 progression (10000*0.50*0.50...)to double money (from 0.01 to 40.96 lots) In 100000 trades there will be 16 progression (from 0.01 to 327 lots). In 1000000000 trades there will be 29 progressions to double money (from 0.01 to 2684355 lots). 29 progression can come any day to blow up bank (it doesnt count from today when progression will come and ea are unpractical)
in roullete is same situation spread eats all profit, in sports betting (adrian massey website has data on horse racing spread 10% )spread eats all profit no matter strategy, teams or combination. so trader can calculate how much is loss connected to number of trades.
only way to beat roullete is to find over long series of numbers number (months) which repeats more often then 1 in 36 and to play that number constantly.
In forex to beat spread need to find more sell orders then buy orders over long period of time (month) to overcome spread. shorth term will not apply.