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The brutal truth of day trading

  • #121
  • Apr 1, 2021 4:00am Apr 1, 2021 4:00am
Quoting joyny
{quote} Hey robots4me! In my post I tried to give simple advice to get statistics for every strategy you are going to use no matter EA or manual. What I see with manual trading.... people pick up indicators, see in charts some profitable entries and decide that can go with real money. For example in this thread this recent post. But it must be backtested at least 3 years and only then can decide....
wow!
amazing stats!
low drawdown, great profit factor, nice sharpe ratio and a very very good recovery factor + never seen a system with >0.10% APHR GHPR

excellent post! fan of your work.

is this diversified or just one EA?
Steps to profitability: Collect data, money management, stay bored
  • #122
  • Apr 1, 2021 4:20am Apr 1, 2021 4:20am
Quoting remonpilip
{quote} wow! amazing stats! low drawdown, great profit factor, nice sharpe ratio and a very very good recovery factor + never seen a system with >0.10% APHR GHPR excellent post! fan of your work. is this diversified or just one EA?
tnx. This is 1 EA.

Have a lot of EAs because of statistical fluctuation. There might be drawdowns periods for any good strategy. Those periods can be >1 year.

Attached Image (click to enlarge)
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Here another real result for the same strategy but diversified (3 symbols EURUSD, GBPUSD, USDJPY, and various EAs setups - 9 EAs here). Not so impressive... was surviving a long drawdown period.. but still according to stats (combined dd in backtests was 20%, in reality, 32%). This package was optimized/backtested with 10 years (every tick not real ticks). But 3 years with real ticks.
  • #123
  • Apr 1, 2021 5:59am Apr 1, 2021 5:59am
much respect for ppl who show their long term results (good or bad) like joyny
  • #124
  • Apr 1, 2021 6:47am Apr 1, 2021 6:47am
Quoting joyny
{quote} Hey robots4me! In my post I tried to give simple advice to get statistics for every strategy you are going to use no matter EA or manual. What I see with manual trading.... people pick up indicators, see in charts some profitable entries and decide that can go with real money. For example in this thread this recent post. But it must be backtested at least 3 years and only then can decide....
Hello @joyny -- thanks for sharing your results!!

However, these aren't the "statistics" we've been talking about. These are RESULT stats that reflect how well your strategy has performed in the PAST. So far only @tommydoginti has provided an example of "statistics" and "maths" that he performs on the most recent data BEFORE entering a trade. We're talking about "statistics" that are applied BEFORE entering a trade. @ryuryu mocks traders who don't apply "statistics" BEFORE entering a trade. However, since being asked to name a particular statistical metric he seems to have gone radio silent. I wonder why...
  • #125
  • Apr 1, 2021 9:50am Apr 1, 2021 9:50am
Quoting joyny
{quote} Hey robots4me! In my post I tried to give simple advice to get statistics for every strategy you are going to use no matter EA or manual. What I see with manual trading.... people pick up indicators, see in charts some profitable entries and decide that can go with real money. For example in this thread this recent post. But it must be backtested at least 3 years and only then can decide....
That is a very interesting topic of sample size for validating a strategy in investment. I see it in a few ways if treating it strictly following scientific requirements

1. Adapting the sample size significance from other fields of statistics, such as biostatistics which is my career. Assuming my day trading strategy takes ~75/month, then it is 900 trades per year. I plan to trade it for 10 years which is 9000 trades. If I need statistics that tells me the expectancy +/-5% from actual, and <5% chance margin of error (discuss later), then the required sample size for backtesting is around 370 trades, which is ~4month worth of data.
With same accuracy requirements, a swing trading strategy also only requires ~ 4 month worth of data, so no difference between styles.

2. However typical backtesting has one major flaw, which is data points are not homogenized and random. Sampling is heavily biased because data acquisition is chronological. Your previous post is a very good example that the margin of error can be >100% as reflected by month to month return. That is also a reason why EQ of a strategy is mostly trending upwards in the beginning. In sample sizing, the require sample is 0 if margin of error is >100%.

3. The brutal truth is we have limited resources. A few ways to somehow overcome the hurdle is 1) Backtest the strategy with as much historical data as possible (forward test/real trades also okay), and then scramble all "trades history" and randomly pick 370 trades to calculate performance then you have 95% chance correct IN THE PAST. or 2) consistently backtesting (in hope of no suddenly deviation) just like the stats indi shared that keeps "backtesting" past 200 days to yield statistics.

4. This is not the challenge only applicable for trading. This is happening everyday is public health biostatistics. Cancer genotype and risk is facing the same problem and applying similar solutions as I know of.

My message is 1) Validation of a strategy require less historical data as expected by most, but utterly impossible to be done accurately. 2) No one is more correct in validating a strategy as everyone is literally wrong. 3) Still no evidence showing day trading is inferior...
  • #126
  • Apr 1, 2021 10:14am Apr 1, 2021 10:14am
"just answer this simple question: shouldn't he be in the top 100 richest person in the world if he were that profitable and consistent?"

Him being the richest man in the world or being a billionaire does not have anything to do with you claiming that short term traders are not profitable... I was just showing you by showing his results that your claim maybe false... Ross is a short term daytrader and he is consistent and have been profitable all this time which negates your claim..and I'm sure there are others out there that are profitable trading short term..
And all the sudden you attack him and start yelling on the forum... so rude!! are you triggered?!? you yelling maybe shows us that you have not developed the discipline to control your emotions (bad bad bad for short term trading)... is this maybe why you've blown many accounts trying to daytrade?
You also claim that-
"It is the market’s price trend component that gives you the statistical edge. To increase your edge, some markets have a higher historical trend component. These are the ones you want to trade! All successful systems employ some method of identifying trend."

Yet you don't provide any of these methods.

You also state - "Trend following - the markets are chaotic. They are non-linear dynamic systems. Market prices are highly random with a trend component. Within chaotic systems is the concept of a fractal, “self similar”. Just like the branches of a tree that get smaller and smaller but look like the original tree as a whole. Therefore a system can be random in the short term, but deterministic in the long term." --

This is Jibberish
You only see determinism in the longer patterns after the fact.. Please enlignthen us on how to determine where the trend will go in the NEXT 60 to 120 days.. what is your method? Does your method have 100% win rate? If so then why are you not a billionaire?? if you really want to help us then give us your method please.. we are all eager to learn it. (and having inside information to determine the longer trend is out of the question..no one wants to go enjoy their profits in jail ...
  • #127
  • Apr 1, 2021 10:17am Apr 1, 2021 10:17am
Quoting remonpilip
also about mt4: When I buy 1 lot of EURUSD, then I close 0.5 lots and close another 0.5 lots in later time, mt4 counts this as 2 trades.
I know one guy who instead of posting long reads about how other people should trade has found some time since 2019 and checked metaquotes manuals about how "close by" function works.
Observer effect
  • #128
  • Apr 1, 2021 3:21pm Apr 1, 2021 3:21pm
Well well.. what a party without me. Beating manual traders with EAs...

One banker said "Money has an opinion". Will subscribe to this thread and post my results at the end of this year. Or not...
  • #129
  • Apr 1, 2021 7:46pm Apr 1, 2021 7:46pm
All these are great discussions for me. I have picked up a few extras for sure.

Love the profit pics, and I also love those "naysayers" too , it all makes the factory go around.


Thanks to Tommy much appreciate your chart on maths & stats
https://www.forexfactory.com/thread/...0#post13477800


My final follow up chart USDCAD from yesterday. A lot happens during my bed time, I'm used to it in Oz lol.
https://www.forexfactory.com/thread/...6#post13477536


Quoting jmn5611
{quote}
When you say stats and maths, what do you mean? I am pretty handy with an excel spreadsheet. {quote}
I do that too. I scalp and I swing. I do not take nearly as many trades as you do though. I let price action tell me if it will be a scalp or a swing. I will take one good trade a day, but my hold time may be the length of a contract.

Thanks also jmn, Tommy since put up a chart on maths & stats for us



.
Attached Image (click to enlarge)
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  • #130
  • Apr 1, 2021 10:23pm Apr 1, 2021 10:23pm
Quoting TimeTells
All these are great discussions for me. I have picked up a few extras for sure. Love the profit pics, and I also love those "naysayers" too , it all makes the factory go around. Thanks to Tommy much appreciate your chart on maths & stats https://www.forexfactory.com/thread/...0#post13477800 My final follow up chart USDCAD from yesterday. A lot happens during my bed time, I'm used to it in Oz lol. https://www.forexfactory.com/thread/...6#post13477536 {quote} Thanks also jmn, Tommy since...
@TimeTells -- one of the best posts ever!! Thank you, Pete...
  • #131
  • Apr 1, 2021 11:22pm Apr 1, 2021 11:22pm
The Brutal truth of daytrading is the Brutal truth of Trading whether it be scalper Swing daytrader or a position trader.

The Brutal truth that no one wants to her is 80+% of the Losers...80+% of traders dont have a handle on their own personal
psychology. They lose because their losses are greater than their wins. Plain and simple a Inverse R:R

80+% of All Traders LOSE ! Thats the Brutal truth

Analysis of 75+ million individual trades proves it...I think thats a large enough "retail" sample size of trades.

Across 15 currencies traded the average Winrate is 60+%.. Most traders win more often than lose.
BUT
Most traders as we all know eventually blow up or are simply not consistently profitable.

Across 15 pairs and 75+ million trades.. The average win is 52 pips and the average loss is 94 pips.
This is what blows up accounts....

You see the failure comes once entered into a trade. we live a Linear life...but trading is Non Lineal
and Cognitive Dissonance come into play as we struggle when were in a winning trade and in a losing trade.

Avoiding the pain of closing a losing trade we let it run...and resolving the discomfort we feel from a winning trade...
HUH ? discomfort from a winning trade... Just think about that

Traders dont need to learn anymore TA or FA... There is no secret.
The edge to transform yourself into a winning trader is to Control your mind.
To be UN NORMAL... Normal traders acting normally lose...

To win you need to think and be UN Normal when trading..
I wont repeat the old adage of cutting losses and blah blah blah..

The man in the mirror is whom you are truly trading against

Cheers
Blue
Master your Mind,,,Master the Market
  • #132
  • Apr 2, 2021 1:06am Apr 2, 2021 1:06am
Well said
  • #133
  • Apr 2, 2021 2:04am Apr 2, 2021 2:04am
One moment I thought TOM HOUGAARD was here. .
on a postive roll...
  • #134
  • Apr 2, 2021 2:50am Apr 2, 2021 2:50am
Remonpilip maybe you should talk to some of the top trading psychologists who work with 8 and 9 figure a year traders... Those guys must be really really really lucky if the markets are random lol. Especially to repeat the performance year after year... It's statistically impossible for it to be luck. There is a powerful edge in trading, it may take you a loooong time to find it though, all you need is a technical edge (or a few ) executed consistently by a psychologically consistent version of yourself with high quality risk management. It's a simple formula and amazing that it takes some of us (like myself many years to turn the corner.. It's really easy to underestimate the psychology part, its really easy to not fix your problems, to cognitive dissonance yourself into screwing it up all the time.

One of "the brutal truths" is that 10,000 hours might not get you there.. For anyone who is serious I recommend at least 2500 hours in a professional environment with mentoring and support from consistently profitable 6 figure + traders.. (or a lot of time invested (or luck) for a robust automated method).. Then you have a much higher chance and are less likely to waste a ton of time like I did.

The real brutal truth is you might spend a decade or more getting nowhere, losing money, missing out on all the other things you could be doing, get seriously depressed, screw up your relationships, get depressed af, lose any and all confidence you previously had and totally fck up your life - and not become a 6-7 figure a year trader.... On the flip, 95% of new businesses fail.. Learn to love the challenge and the growth opportunity.
  • #135
  • Apr 2, 2021 3:05am Apr 2, 2021 3:05am
Quoting robots4me
{quote} one of the best posts ever!!
Hey there, I haven't used FF for quite a long time (I mostly use Sierra Charts for the last few years)

I was searching for something last night and somehow found your thread with the indicators. I was intrigued by your offering to give back and seeing how I really enjoy trix I was curious and have been testing out your R4M-BBIITX indicator. I think this is a very powerful indicator and could become an excellent swingtrading ea. (Like on a 8H or 12H chart trading with the signals in the direction of the slope). I was wondering if we could chat about a possible collaboration on this. I have worked with mt4 a lot in the past and have a couple of "shell ea's" I've developed with advanced features that it could be easily added to. I'm sure you do too but collabs with experienced people can have interesting benefits. I see you have private messaging off, you could contact me at futures dot io, my nickname is TropicalTrader, cheers!
  • #136
  • Edited 4:05am Apr 2, 2021 3:50am | Edited 4:05am
This job, cause for me is a full time job since 2 decades, is against human nature.
This is a very hard job, and it's a solitary job, all alone, no colleagues, no boss, no customers, no phone calls, no meetings, no business travel.

Then trading business around always reduce chances with commissions, spread, siippage and so on.
Brokers, Banks, new platforms, gurus, financial experts all around of a zero sum game!

And they are well aware that most of their new customers are gamblers, and some even with self-destructive personality.
Easy and fast money dream always attract many worlwide gamblers.
And even if you have a well organized trading system you may fail, cause you are not mentally prepared to manage the pressure.

Then market don't care about you, about everyone, and it's designed to fool most traders (you, me, us included) most of the time.
But in the end market is only an electronic world where a trader try to take money away from the other traders, one against all.......
and the profit we wish is money that belong to other traders who have no will to give it to you!

Some quotes here are from historical traders, not mine, and I learned them on my skin.
When I was fully aware of this overall scenario nearly 1 decade ago, I started really to trade for living.

Good luck to everybody from Brix, the survivor!
I call upon my father's spirit , watching over me
  • #137
  • Apr 2, 2021 5:24am Apr 2, 2021 5:24am
You guys would just come here and be making STUPID AND NEGATIVE POST. JUST BECAUSE YOU CANNOT MAKE MONEY ON DAY TRADING DOES NOT MEAN SOMBODY ELSE CANNOT MAKE OR IS NOT MAKING.

Yes it is hard we get it and yet others are making it so PLEASE STOP ALL THIS NON SENSE
THE TRUTH IS SIMPLE,ACCEPTING THE SIMPLICITY OF THE TRUTH IS WHAT IS HARD
  • #138
  • Apr 2, 2021 10:19am Apr 2, 2021 10:19am
Quoting martinez1
You guys would just come here and be making STUPID AND NEGATIVE POST. JUST BECAUSE YOU CANNOT MAKE MONEY ON DAY TRADING DOES NOT MEAN SOMBODY ELSE CANNOT MAKE OR IS NOT MAKING. Yes it is hard we get it and yet others are making it so PLEASE STOP ALL THIS NON SENSE
Hi Martinez, I would not say stupid, cause every opinion deserves respect if ther's no offence.
And yes, someone seems negative, but in the end it's only a personal perspective.

It's not only a sparkling & shining world as many try to show, and personally I'm very happy to have found a good job that let me run a whole large family this way.

But I've seen, specially last years ansd specially last Covid year, too many coming sure to find the easiest and fast way to make money.
I always warned them, cause this job need hard work and mentally strenght.
That's all!!! Nothing more and notning less!!

Happy Easter to you!
I call upon my father's spirit , watching over me
  • #139
  • Apr 2, 2021 10:54am Apr 2, 2021 10:54am
Quoting martinez1
You guys would just come here and be making STUPID AND NEGATIVE POST. JUST BECAUSE YOU CANNOT MAKE MONEY ON DAY TRADING DOES NOT MEAN SOMBODY ELSE CANNOT MAKE OR IS NOT MAKING. Yes it is hard we get it and yet others are making it so PLEASE STOP ALL THIS NON SENSE
Yes you're right, martinez,, i cannot make money on day trading because i don't want to look at screen every minute to burn my stupid eyes and stupid brain. So that why i must do stupid way to trade.

Here is my stupid Short position @ level 1.23,, I know i'm so stupid still keeping this stupid position recently,, i'm so stupid, i need your advice please.

Happy Easter to you.

Attached Image (click to enlarge)
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BullShit BearShit
  • #140
  • Apr 2, 2021 11:02am Apr 2, 2021 11:02am
Quoting etrade360
Here is my stupid Short position @ level 1.23
Hi daydreamer! Let me guess, before that short you was in long right from 1.16 and kept it till 1.23?
Observer effect
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