very interesting thread, thanks to Fezmar.
as i've LIVE traded graeme's method in 2010 and 2011, the keys of the method are two:
1. maintain a frequency to enter -- participation (quoted Graeme)
it may be extremely exhaustive and mentally torturing to maintain this "frequency"
2. how to exit. ---- in fact, many newbies, or weak minds fall here.
in fact, only a trader with a good trading technique (his method must have a positive expectancy, regardless of RR) can succeed, imho. however, the dilemma here is that when a trader has a good skill, he doesn't need to trading this way anymore. he'll be profitable right there at the end of the day, instead of the end of the year.
at this end of the day, a profitable trader will be profitable using it, very likely much more profitable;
but a losing trader will very likely (i in fact believe he still will) stay losing using this method.
the reason is simple, the core of the trading, one's entry+exit combined has positive expectancy OR NOT???
failure to realize that the profit lies in entry+exit method is very dangerous to who uses this method! It is never the MM that plays the core ---- in this case, I don't think adjust RR to 40 is about MM.
I guess the true merit of this method is for traders who like doing it part time, or with a method having a little edge like 55% (at most 60%, but less than 70%, assuming RR=1). This is very likely best investment method in this world, but probably not the best for daytraders.
though i don't trade in this manner, but i attached an EA which I coded in Graeme year (2010) following his idea. the entry was based on every 100 pip grid with sl of 100 pip. i believe that if for this year 2014. you will have crazy profit using it. it will be easily backtested in MT4, if interested. Anyone may change the entry method like a MA cross, or RSI cross. The outcome will be similar. I don't have a MT4 to show you the backtest now.
it is merely a supporting document to Fezmar's trading methodology.
as i've LIVE traded graeme's method in 2010 and 2011, the keys of the method are two:
1. maintain a frequency to enter -- participation (quoted Graeme)
it may be extremely exhaustive and mentally torturing to maintain this "frequency"
2. how to exit. ---- in fact, many newbies, or weak minds fall here.
in fact, only a trader with a good trading technique (his method must have a positive expectancy, regardless of RR) can succeed, imho. however, the dilemma here is that when a trader has a good skill, he doesn't need to trading this way anymore. he'll be profitable right there at the end of the day, instead of the end of the year.
at this end of the day, a profitable trader will be profitable using it, very likely much more profitable;
but a losing trader will very likely (i in fact believe he still will) stay losing using this method.
the reason is simple, the core of the trading, one's entry+exit combined has positive expectancy OR NOT???
failure to realize that the profit lies in entry+exit method is very dangerous to who uses this method! It is never the MM that plays the core ---- in this case, I don't think adjust RR to 40 is about MM.
I guess the true merit of this method is for traders who like doing it part time, or with a method having a little edge like 55% (at most 60%, but less than 70%, assuming RR=1). This is very likely best investment method in this world, but probably not the best for daytraders.
though i don't trade in this manner, but i attached an EA which I coded in Graeme year (2010) following his idea. the entry was based on every 100 pip grid with sl of 100 pip. i believe that if for this year 2014. you will have crazy profit using it. it will be easily backtested in MT4, if interested. Anyone may change the entry method like a MA cross, or RSI cross. The outcome will be similar. I don't have a MT4 to show you the backtest now.
it is merely a supporting document to Fezmar's trading methodology.
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