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Hedging/averaging trades without prediction

  • #3,461
  • May 23, 2024 2:05pm May 23, 2024 2:05pm
Quoting lddd
{quote} I have it running on an ICM demo account. So the trades are opened without any logic in terms of time, money management or direction? I've read about some experiments like this in the past where trades were entered absolutely randomly, but I don't think they could achieve profitable results in the long term if the costs were taken into account. If it goes well I will test it live next month or with a prop company. It says "Fxdreema". Are these EAs available to be used 1:1 by others? Then there could possibly be a problem with the props because...
They open based on a certain size candle then add as long as a gap big enough appears, all trades and TP are optimised after some backtesting, no SL as I’m not a fan and haven’t used one for years, pretty basic stuff but you are correct about costs, having said they once they start they keep going so there would be positive and negative swap.
Sounds like a lot of screen time to me.
  • #3,462
  • May 23, 2024 2:10pm May 23, 2024 2:10pm
Quoting Waveskierrob
{quote} hedge open 8050
Closed hedge 8053 -3...
  • #3,463
  • May 23, 2024 4:46pm May 23, 2024 4:46pm
Quoting LazyTrades
{quote} They open based on a certain size candle then add as long as a gap big enough appears, all trades and TP are optimised after some backtesting, no SL as I’m not a fan and haven’t used one for years, pretty basic stuff but you are correct about costs, having said they once they start they keep going so there would be positive and negative swap.
Thanks.

So the EAs are not completely random and are optimized as a result of your backtesting on the M5 timeframe. Understand. Optimization is tricky as it can easily result into curve fitting.

I can recommend to always do a second backtest on some unseen data (out-of-sample). If the results are still good with your new best parameters found, run a monte-carlo simulation and test against different markets to check for further robustness of the system.

How you came across USD/MXN? That’s quite exotic :-)

Stops - Yes, many doesn’t seem to like (especially here).

There are many ways to manage risk, just don’t rely on „hope“. Even small sized trades can turn into a big loss if given unlimited room and time.
  • #3,464
  • Edited May 24, 2024 5:25am May 23, 2024 4:58pm | Edited May 24, 2024 5:25am
Quoting lddd
{quote} Thanks. So the EAs are not completely random and are optimized as a result of your backtesting on the M5 timeframe. Understand. Optimization is tricky as it can easily result into curve fitting. I can recommend to always do a second backtest on some unseen data (out-of-sample). If the results are still good with your new best parameters found, run a monte-carlo simulation and test against different markets to check for further robustness of the system. How you came across USD/MXN? That’s quite exotic :-) Stops - Yes, many doesn’t seem to...
I don't hold a great deal of faith in backtesting if truth be told, only to test basic concepts, forward testing with real money on the other hand (and don't overthink it). If I remember correctly I started looking at USD/MXN as a means to short USD in a hedge basket where I might also be long on another USD pair, pays swap as well which is why it has been in my live trading basket for some time.

Just to be clear, I’ve never proposed that those EAs are some sort of guru sorcery to retire on, but they have been consistently profitable over a number of months without using a SL, without exposing a big DD and opening based on nothing more than a fat candle. The point for me is not to believe everything you read about trading until you try it for yourself, cut loose from the traditional indicator-based, fortune telling BS and it all gets much clearer and much less stressful.

If you saw my charts you’d probably ask why I even bother with them and entries are made as soon as I close a profitable basket. News etc. is just an entertaining moment of madness for me these days during which I’ll either cash in or open more trades. I’m trading with money made from years of trading profits so even if it all goes tits up I’ll be at worst BE (promise to post if that happens BTW ).
Sounds like a lot of screen time to me.
  • #3,465
  • May 23, 2024 7:42pm May 23, 2024 7:42pm
Quoting Waveskierrob
{quote} I LONGED again 8106, bagged myself 12 pip DIV today, so above water again...
Well done Rob. I also nursed mine to profit but took longer than you. I exited yesterday having entered at 8149.9, 8133.9, 8085.9 (avg 8123.2) and exited at avg 8126.4. Just a negligible gross P of 3.2 against gap of 27.
  • #3,466
  • Edited 6:41am May 24, 2024 6:14am | Edited 6:41am
Quoting LazyTrades
{quote} I don't hold a great deal of faith in backtesting if truth be told, only to test basic concepts, forward testing with real money on the other hand (and don't overthink it). If I remember correctly I started looking at USD/MXN as a means to short USD in a hedge basket where I might also be long on another USD pair, pays swap as well which is why it has been in my live trading basket for some time. Just to be clear, I’ve never proposed that those EAs are some sort of guru sorcery to retire on, but they have been consistently...
OK. Maybe, but I think if you want to make a living from trading for longer than maybe a few months, you should approach it a little more professionally than "it'll be okay somehow." With this attitude, you might get a salary at the end of the month from your employer (no matter what), but you probably won't last long as a self-employed trader (my opinion).

I think backtesting has its place if you want to know whether something will ever work anywhere near the way you hope it will in the future. It should be clear that this is no guarantee of future results. I just wanted to give you this as a tip based on my experiences and what I've read. By all means, don't test anything.

It's funny to see how a post like yours gets the likes (no offense), which somehow confirms to me that many people here see trading as a game or hobby. Personally, as I said, I try to approach trading seriously, Maybe that's my mistake why I'm not profitable.

I think I'll be revoke my membership here soon because I can't seem to find any real help here from people who are going through the same thing (taking it seriously).

Your EAs so far are at least more profitable than my own trading. Instead of the fixed position size of 0.01 lots, could you create a way to risk x% of the balance/equity instead and perhaps time filters so that the EA only opens trades during a specific market session, for example? Thanks in advance.

My results with your EAs so far

Attached Image (click to enlarge)
Click to Enlarge Name: Bildschirmfoto 2024-05-24 um 12.48.20.png Size: 233 KB

Edit: Oh forgot. Yes, without stop levels a percentage position size is difficult. Then you will probably only be able to control the profit/risk by either trading on fewer or more markets if you let it run like this 24/7. For prop trading it probably won't work without a news filter and then the question is whether it would still be profitable if it had to be constantly interrupted at these times.
  • #3,467
  • May 24, 2024 6:33am May 24, 2024 6:33am
Hello Ld, please don't take this personally but from what I can glean from your posts I'm thinking your psychology is wrong, you seem an intelligent chap who is determined to find ways not to trade. I've been trading profitably for decades, using many instruments, but that's not to say I've made millions, (more like 10s of thousands) and as for trading for a living it's not my primary goal, but that's not to say I don't take what I do seriously.

Thanks for your input, but like all advice, I'll respectfully decline until I have my own empircal evidence.

One thing I do believe is unless you have sufficient capital you'll never be able to live off the ups and downs of trading, especially when you have no other income and need to constantly take money from your bank to live on. In my early days of stock trading I used to study charts, read books, study more charts, read, study, test, lose, win, study, read charts, copy other traders, jump from method to method etc. etc. (I was taking it seriously believe me) but I no longer do any of this and haven't done for years, I think I started to make money once I stopped taking it so seriously, just a thought?
Sounds like a lot of screen time to me.
  • #3,468
  • May 24, 2024 6:48am May 24, 2024 6:48am
Quoting LazyTrades
Hello Ld, please don't take this personally but from what I can glean from your posts I'm thinking your psychology is wrong, you seem an intelligent chap who is determined to find ways not to trade. I've been trading profitably for decades, using many instruments, but that's not to say I've made millions, (more like 10s of thousands) and as for trading for a living it's not my primary goal, but that's not to say I don't take what I do seriously. Thanks for your input, but like all advice, I'll respectfully decline until I have my own empircal evidence....
I think my psychology is that I look at things as emotionlessly and soberly as possible and that I am simply looking for a realistic way to be able to live from trading in the long term and, if necessary, to be able to save something for my pension. I agree that this requires a certain amount of capital. That's why I set my clear goal of 1-2% per month under x risk. At 1-2% a month I could definitely manage to build a life from it, be it through a prop company or even with my own money.

I didn't want to portray you as a dubious gambler, sorry if it came across that way.
  • #3,469
  • May 24, 2024 7:05am May 24, 2024 7:05am
Quoting lddd
{quote} I think my psychology is that I look at things as emotionlessly and soberly as possible and that I am simply looking for a realistic way to be able to live from trading in the long term and, if necessary, to be able to save something for my pension. I agree that this requires a certain amount of capital. That's why I set my clear goal of 1-2% per month under x risk. At 1-2% a month I could definitely manage to build a life from it, be it through a prop company or even with my own money. I didn't want to portray you as a dubious gambler,...
No problem, if my hedge live trading continues at its current rate I'll be on track for +/- +40% for the year as it's currently running around .8% per week with no more than approx 3% DD to date (I'll need to check the exact figures later), I'm happy with that, considering I don't do much for it in relation to screen time etc. but I acknowledge that if Japan invades Mexico, for example, there may be some rocky roads ahead. I accept it's a risky business, if I didn't I'd put it all in Premium Bonds.
Sounds like a lot of screen time to me.
  • #3,470
  • May 24, 2024 7:19am May 24, 2024 7:19am
Quoting Waveskierrob
{quote} LONG again CAC @ 8074...
Just closed 8086 +12, still underwater overall
  • #3,471
  • May 24, 2024 7:28am May 24, 2024 7:28am
Quoting LazyTrades
Hello Ld, please don't take this personally but from what I can glean from your posts I'm thinking your psychology is wrong, you seem an intelligent chap who is determined to find ways not to trade. I've been trading profitably for decades, using many instruments, but that's not to say I've made millions, (more like 10s of thousands) and as for trading for a living it's not my primary goal, but that's not to say I don't take what I do seriously. Thanks for your input, but like all advice, I'll respectfully decline until I have my own empircal evidence....
Great post..
  • #3,472
  • May 24, 2024 7:35am May 24, 2024 7:35am
Quoting Waveskierrob
{quote} Just closed 8086 +12, still underwater overall
I must admit I didn't think I'd be opening a French pension on Monday!.... se la vie
  • #3,473
  • May 24, 2024 7:43am May 24, 2024 7:43am
Quoting Fagin
{quote} I must admit I didn't think I'd be opening a French pension on Monday!.... se la vie
It's a win/win, the more money everyone puts into the CAC/ French economy the sooner it will go up, I'm off for some pain au chocolat and Châteauneuf-du-Pape.
Sounds like a lot of screen time to me.
  • #3,474
  • May 24, 2024 8:02am May 24, 2024 8:02am
Quoting LazyTrades
{quote} It's a win/win, the more money everyone puts into the CAC/ French economy the sooner it will go up, I'm off for some pain au chocolat and Châteauneuf-du-Pape.
Don't forget to buy a Citreon as well, LT!
  • #3,475
  • May 24, 2024 9:42am May 24, 2024 9:42am
Quoting LazyTrades
{quote} No problem, if my hedge live trading continues at its current rate I'll be on track for +/- +40% for the year as it's currently running around .8% per week with no more than approx 3% DD to date (I'll need to check the exact figures later), I'm happy with that, considering I don't do much for it in relation to screen time etc. but I acknowledge that if Japan invades Mexico, for example, there may be some rocky roads ahead. I accept it's a risky business, if I didn't I'd put it all in Premium Bonds.
I think that's good. Anything in trading that outperforms buy-and-hold investing + inflation and costs is.

What is being done here as hedging and averaging down doesn't quite suit my style or what I'm actually looking for, but if it's profitable and the risk is manageable, why not. Never stop learning. However, I wouldn't want to trade in that way manually myself. To me that sounds like a lot of screen time. From the posts I've read here so far, it seems to me that people are busy trading non-stop. Constantly having new positions, adding, ending, this and that. Sounds like a lot of stress to me.

With the EAs like the ones you provided it's a different story even if the 6 month results are not really meaningful. Like said, i tested EAs and they were good for multiple years and then suddenly collapsed. Maybe there are more robust ones (and still profitable on the shorter term), idk.

Like said i came here because of the ex-div trade but so far i haven't figured out how to make this work for me to deliver such a consistent profitable result of +2% per month without high drawdowns or having to do the stuff with multiple positions, averaging down "hedging" etc. I wanted to do a backtest here but you can't find any good data for it. IG doesn't provide any historical intraday data going back at least a few years. With other broker's it doesn't even seem to work at all.

Maybe easier to make a living from trading if you are on the other side (broker, EA seller, YouTube Guru, Forum...).

Anyhow. Have a good weekend.
  • #3,476
  • May 24, 2024 9:49am May 24, 2024 9:49am
Quoting LazyTrades
{quote} It's a win/win, the more money everyone puts into the CAC/ French economy the sooner it will go up, I'm off for some pain au chocolat and Châteauneuf-du-Pape.
Stock indices always go up as long as economy grows and corporations earn more money.
  • #3,477
  • May 24, 2024 9:51am May 24, 2024 9:51am
Quoting LazyTrades
{quote} Oanda UK and here are the EAs: {file} {file} {file} {file}
Hi, can i ask you how i can change the possiotion size ? i have not code resource and cant open in my mt editor. Can you help me ?
  • #3,478
  • May 24, 2024 10:02am May 24, 2024 10:02am
Quoting Snoozy
{quote} Hi, can i ask you how i can change the possiotion size ? i have not code resource and cant open in my mt editor. Can you help me ?
Hi Snoozy, if you are going to trade/test using EAs you need to at least be able to edit them yourself, don't need to be a coder, have a look at fxdreema.
Sounds like a lot of screen time to me.
  • #3,479
  • May 24, 2024 10:04am May 24, 2024 10:04am
Quote
Maybe easier to make a living from trading if you are on the other side (broker, EA seller, YouTube Guru, Forum...). Anyhow. Have a good weekend.

This bit, I suspect, is almost defintely true (if you are willing to park all your morals). Re screen time, that's why I trade the way I do so I'm not stuck nursing my trades, if I go a whole day without looking at them it's not a problem for me, even if I miss a profit I'll let things go round again collecting the swap and waiting.
Sounds like a lot of screen time to me.
  • #3,480
  • May 24, 2024 10:10am May 24, 2024 10:10am
Quoting Fagin
{quote} Don't forget to buy a Citreon as well, LT!
Had a friend many years ago who bought and sold cars for a living on an industrial scale, told me to never buy anything French or yellow (cars that is, as the custard slices can be delicious). That current FR40 green candle is the result of my Bugatti purchase earlier, anything to help.
Sounds like a lot of screen time to me.
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