The only system that will work is one designed by and for yourself.
A Simple Mean Reversion Strategy 327 replies
Pairs Trading: Reversion to the Mean 22 replies
Forward test of my new mean reversion strategy 11 replies
Synthetic hedges, cointegration, mean reversion and similar stuff 419 replies
Cointegration, Synthetic hedges, mean reversion in R, Tech Thread 0 replies
DislikedEverybody wants a magic indicator then automation. Trading is about a deep connection to one characteristic of the market, that give you an edge. Most traders will spend years looking for indicators and automation, rather then do the hard work.Ignored
DislikedEverybody wants a magic indicator then automation. Trading is about a deep connection to one characteristic of the market, that give you an edge. Most traders will spend years looking for indicators and automation, rather then do the hard work.Ignored
Disliked{quote} True. But automation on itself is a VERY HARD WORK! You can wait for someone to give you the "magic" indicator or the magic EA - this is easy! Most people will settle on this option. Or you can start to do your own research and your own coding. Search for patterns, test them, build trading models.......it's a long process with many ups and downs. Excitements and disappointments......until you find something stable that works. Manual trading or automated - both require a lot of work and dedication. (If you want to do it professionally.)Ignored
Disliked{quote} True. But automation on itself is a VERY HARD WORK! You can wait for someone to give you the "magic" indicator or the magic EA - this is easy! Most people will settle on this option. Or you can start to do your own research and your own coding. Search for patterns, test them, build trading models.......it's a long process with many ups and downs. Excitements and disappointments......until you find something stable that works. Manual trading or automated - both require a lot of work and dedication. (If you want to do it professionally.)Ignored
Disliked{image} “If you knew the magnificence of the three, six and nine, you would have a key to the universe.” 3 6 9 ! 3 + 6 + 9 = 18 1 + 8 = 9 3 * 3 = 9 6 * 6 = 36 3 + 6 = 9 9 * 9 = 81 8 + 1 = 9 9 9 9 ??? 3 * 9 = 27 2 + 7 = 9 9 + 9 + 9 = 18 1 + 8 =9 9 * 9 * 9 = 729 7 + 2 + 9 = 18 1 + 8 = 9 999 9 + 9 + 9 = 27 2 + 7 = 9 9 + 36 + 81 = 126 1 + 2 + 6 = 9 999 / 3 = 333 3 + 3 + 3 = 9 126 + 333 = 459 4 + 5 + 9 = 18 1 + 8 = 9 126 * 333 = 41958 4 + 1 + 9 + 5 + 8 = 27 2 + 7 = 9 333 * 333 = 110889 1 + 1 + 0 + 8 + 8 + 9 = 27 2 + 7 = 9 9 ???? 9 * 9 = 18 1 + 8 = 9...Ignored
Disliked{quote}... So is there an edge to incorporate 3/6/9 in a strategy?....Ignored
Disliked{quote} No. There is no edge in the numbers. But there is a hidden formula involving these numbers which can lead you to the edge. With this formula you can solve the "inevitable" problem which arises when you apply dynamic hedging trading model. (The problem of the constant unbalanced equation) I think I found a way to balance this equation perfectly at least 99% of the time. I'm sure of this! Now I'm writing the code in order to prove this theory first on demo and later on a live account. Maybe there is no real holy grail in trading, but this...Ignored
Disliked{quote} Interesting.....good luck man. If you balance the dynamic hedge 99% of the time, how will you recover spreads and slippage costs? I tend to also think it is possible but only (at least in my case) if you trade really small size with large number of positions. Even with reversion to mean techniques you will always need a repeat of small (although brief) directional moves to recover and profit from that 1% to tilt the needle towards profitability. I think theorical models will look good but practicality of implementation would be prohibitive...Ignored
Disliked{quote} V, have a read on this book; it's a classic and it is very useful for mean reversion trading. Pairs Trading: Quantitative Methods and Analysis by Ganapathy Vidyamurthy Trading Forex is actually "Pairs Trading" because you are trading the spread between two currencies (EUR vs USD, GBP vs USD, etc). the secret to mean reversion trading; is to know when to add positions; and when to exit positions solely based on the mean reversion model. Positions...Ignored
Disliked{quote} You answered your own questions! Of course that we need minimum range. This is part of the strategy but I left the details for next posts. (I can't write long posts now) After all we try to capture only 50%(max) of the range during the first half of the day. So for example if we have range 5 pips it does not make sense to open position because the maximum potential profit is only 2.5 pips. This is why in the second system layer I use sqrt(t) to determine optimal entry points. I have this calculation in graphical/visual form as well. I will...Ignored