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Attachments: All in All - my experience
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All in All - my experience

keep it simple, bro. dont make it complicated. just use bar or 1 MA, more than enough.
Quoting KarlStone
{quote} With respect, I disagree. I don't know how to calculate pip value, nor do I want to calculate pip value and lot size for every single currency-pair I trade, and correct it for my account being in GBP, and convert that into lot size. All I know is I want to risk 1% of my account, and I know my entry, SL and my TP. I put that into an EA, and the EA calculates it for me.
this is the best excuse/solution for anybody can not learn basics. you know people minds are different.
but to be professional in risk analysis, you must master market math basics.
if not, please do not use word "risk analysis" in your posts/live.
Be yourself
we do not speak here about MA ? different topic
Quoting antonsatu
keep it simple, bro. dont make it complicated. just use bar or 1 MA, more than enough.
this is the most simplest and concise rules.
the miracle here is that: PV is always XXXDDD for EURUSD or biscuits or XAGUSD or BTCUSD or NAS100 or whatever.
common rule! PV=XXXDDD -- very simple and unique for any instrument.

what is the PV of EURUSD? ans: it is XXXDDD
what is the PV of GBPNZD? ans: it is XXXDDD
what is the PV of USDZAR? ans: it is XXXDDD
what is the PV of OILUSD? ans: it is XXXDDD
what is the PV of KRWUSD? ans: it is XXXDDD
what is the PV of DOW30? ans: it is XXXDDD

if you do not know this rule, the market is not your appropriate place. you know there are a plenty of intruders in "forex"
Be yourself
Quoting Macd-rsi
{quote} this is the best excuse/solution for anybody can not learn basics. you know people minds are different. but to be professional in risk analysis, you must master market math basics. if not, please do not use word "risk analysis" in your posts/live.
Please can you describe what you mean by risk analysis? My example of '1%' was just an example. I could've said 2%, 3%. I can even get into a scaling plan which ensures my maximum annual drawdown is never more than 10% of my total account value in a year. I can adjust that for my own risk tolerance.

The thing is, none of the above risk mitigation requires what you refer to as market math basics.

A good metaphor is an engineer (which I have been). To design a skyscraper, do we have to know how to derive the mathematics of solid mechanics from first principles? The answer is a very resounding no. We use rule-of-thumb calculations which will yield slightly-conservative solutions, which we can do in 1/10th the time of a complex mathematical solution.

Traders are like engineers. We are concerned with the practicalities of building a building (designing a profitable trading system). We are not concerned with first-principle mathematical calculations when we could just use a pre-built tool or simplified equation.

I have no doubt there are 7-8 figure trades that aren't 'masters at market math basics', as you describe. Many traders I know that have worked at IB's have literally very few mathematical skills compared to an engineer, yet they make a lot of money.

Here's a final quesiton for you - Are you calculating your PV and lot size manually for every trade you take? Why?
Quoting KarlStone
{quote} Please can you describe what you mean by risk analysis? My example of '1%' was just an example. I could've said 2%, 3%. I can even get into a scaling plan which ensures my maximum annual drawdown is never more than 10% of my total account value in a year. I can adjust that for my own risk tolerance. The thing is, none of the above risk mitigation requires what you refer to as market math basics. A good metaphor is an engineer (which I have been). To design a skyscraper, do we have to know how to derive the mathematics of solid mechanics...
assume you have now 4 positions:
0.01 eurusd
0.01 xagusd
0.01 nas100
0.01 usdnok
how to estimate the risk without above equations?

also, if you scale, how to know in advance number of orders?
Be yourself
Quote
what is the PV of EURUSD? ans: it is XXXDDD
what is the PV of GBPNZD? ans: it is XXXDDD
what is the PV of USDZAR? ans: it is XXXDDD
what is the PV of OILUSD? ans: it is XXXDDD
what is the PV of KRWUSD? ans: it is XXXDDD
what is the PV of DOW30? ans: it is XXXDDD


what is the PV of EURUSD? ans: it is XXXDDD = USDUSD=1
what is the PV of GBPNZD? ans: it is XXXDDD = NZDUSD
what is the PV of USDZAR? ans: it is XXXDDD = ZARUSD = 1/USDZAR
what is the PV of OILUSD? ans: it is XXXDDD = USDUSD=1
what is the PV of KRWUSD? ans: it is XXXDDD = USDUSD=1
what is the PV of DOW30? ans: it is XXXDDD = USDUSD=1
Be yourself
Quoting Macd-rsi
{quote} assume you have now 4 positions: 0.01 eurusd 0.01 xagusd 0.01 nas100 0.01 usdnok how to estimate the risk without above equations? also, if you scale, how to know in advance number of orders?
I see.

I still think there are a large number of profitable traders who don't do such calculations, because they simply have 1 open trade at any time, or minimise their exposure in some other simple way.

Whatever works for you man. I feel like the less complex math is in my life, the better.
Quoting KarlStone
{quote} I see. I still think there are a large number of profitable traders who don't do such calculations, because they simply have 1 open trade at any time, or minimise their exposure in some other simple way. Whatever works for you man. I feel like the less complex math is in my life, the better.
we here speak about smart traders who diversify b/w 20 instruments with diff PVs etc..
Be yourself
Quoting Macd-rsi
{quote} we here speak about smart traders who diversify b/w 20 instruments with diff PVs etc..
Smart traders??? Smart traders use Smart engineers to create robots for them. They ask them to create the robots based on advanced statistics such as derivatives etc. At least this is what my friend told me...he was not that smart of course. He was just head of exotics trading at city group and he now has his own fund...
You are allowed to fall but you are imposed to get up!
Quoting iero4
{quote} Smart traders??? Smart traders use Smart engineers to create robots for them. They ask them to create the robots based on advanced statistics such as derivatives etc. At least this is what my friend told me...he was not that smart of course. He was just head of exotics trading at city group and he now has his own fund...
we here to spread basic necessary math knowledge
the general rule that can be applied for any instruments
unique rules.
almost 99% of traders ignore these basics
Be yourself
Now what is the relationship b/w pips P/L and 1% P/L?
In other words, what is the ,mathematical equation that relates 1% profit/loss to pips? (how many pips to profit 1%)
Attached Image (click to enlarge)
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L
Be yourself
assume you want to design your lots, so that each 2 pips your profit is 1%
just substitute in the last post equation.
Be yourself
what is the relationship b/w Ip and I if entry is not on FULL MARGIN?
I is MCP--Margin Call Pips

Let us prove it together:
Be yourself
Attached Image (click to enlarge)
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How to prove in advance MCP=I=96 pips?

rule
I = (1-S)/R*ZZZXXX * 10^(d-r)
=(1-S)/R*CHFJPY * 100
S=30% = StopOutMarginLevel
R=100 = Leverage

(1.00-0.30)/100*137*100 = 0.7*137=96
Be yourself
Good point, but if u want to be more successful, these not enough.
if you trade:
EURUSD BUY
USDCAD BUY
EURCAD SELL
all 1 lot . .
Does it imply that there is a HEDGE?

hence: EURCAD=EURUSD*USDCAD . . .
Be yourself
Quoting Macd-rsi
if you trade: EURUSD BUY USDCAD BUY EURCAD SELL all 1 lot . . Does it imply that there is a HEDGE? hence: EURCAD=EURUSD*USDCAD . . .
To solve ,,, take into consideration, PV of each pair . . .
convert from pairs to currencies . .
Be yourself
if DDD=USD

EURCAD ---> PV = 1/USDCAD
USDCAD---> PV = 1/USDCAD
EURUSD ---> PV = 1.0000

EURCAD = EURUSD*USDCAD
then:
initially,
EURCAD1 = EURUSD1*USDCAD1
after some days:
EURCAD2 = EURUSD2*USDCAD2


and common sense rule . . .
EURCAD2=EURCAD1+ p2
EURUSD2=EURUSD1+ p0
USDCAD2=USDCAD1+ p1
each pairs moves by some pips px
Be yourself
Quote
EURCAD ---> PV = 1/USDCAD
USDCAD---> PV = 1/USDCAD
EURUSD ---> PV = 1.0000
now to make net PV=0.0 for each current, as if there is no currency . . .
for USD in EURUSD, USDCAD . . .
PV = 1-1/USDCAD
so:
EURUSD ==> PV=1
then
x*USDCAD = x/USDCAD = EURUSD=1

x=1*USDCAD=EURCAD ----->
result: lots of USDCAD must be the price if USDCAD itself . . .
Be yourself
  • Post #40
  • Quote
  • Edited 6:26am Sep 21, 2023 5:37am | Edited 6:26am
USD:
Now:
EURUSD -- 1 lot
USDCAD --- (USDCAD) lots
if price of USDCAD is 1.3400, then the lots must be 1.34
UDS net PV value is 0.000
-
next find lots of EURCAD
and to be aligned with other two pairs
Be yourself
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