Edit: Just realised this is the Martingale Strategy
Hello I am looking for any criticism, and too methods of implementation.
Forex is 2 dimensional, price is 1 dimensional. Price can only go up or down. Suppose the market is random, suppose it's not. We can agree that price has a 50% chance of going X pips either way.
So, the strategy. Suppose you trade a strategy where is price breaks a certain level upwards or downwards there is a 50% chance of success. So if you win you win. If you lose you lose. Now suppose when you lose, you hedge that loss, and trade the following day with twice the leverage, and so on and so forth until a success is achieved. In the end the return is small compared to the leverage used but the losses are hedged. There is 0.0009765625% chance of failing 10 times in a row with a 50% winrate. So if you trade small enough to be able to handle 10 losses, then you will be able to consistently make money without risk of going broke, given that the percentage mentioned above is near 0.
What are your thoughts, I would like to discuss theories on how to implement this strategy avoiding as much risk as possible.
Regards.
Hello I am looking for any criticism, and too methods of implementation.
Forex is 2 dimensional, price is 1 dimensional. Price can only go up or down. Suppose the market is random, suppose it's not. We can agree that price has a 50% chance of going X pips either way.
So, the strategy. Suppose you trade a strategy where is price breaks a certain level upwards or downwards there is a 50% chance of success. So if you win you win. If you lose you lose. Now suppose when you lose, you hedge that loss, and trade the following day with twice the leverage, and so on and so forth until a success is achieved. In the end the return is small compared to the leverage used but the losses are hedged. There is 0.0009765625% chance of failing 10 times in a row with a 50% winrate. So if you trade small enough to be able to handle 10 losses, then you will be able to consistently make money without risk of going broke, given that the percentage mentioned above is near 0.
What are your thoughts, I would like to discuss theories on how to implement this strategy avoiding as much risk as possible.
Regards.
HMSR