How I Turned 1k To 100k In A Wk!!!

Yep same. I took $30 that I had sitting in a dead account and turned it into $700 in 3 weeks before I blew out. I blew out on a single trade, a huge move on the GBPJPY.

Hi,
JUST SOMETHING TO THINK ABOUT. Just a thought, not a MM suggestion.

I guess the best way to trade this type of a system would be to break your account into 10 parts (as one of the boarders suggested), and after every trade (win or loss), divide it again by 10 all over again.

For eg. if you start with $1000, then your per trade risk should be $100. If you lose your 1st trade then your new risk per trade should be $90 [(1000-100)/10]. But the main aspect should be your reward risk ratio which should be MINIMUM 2:1 for this system to work.


Now assuming that you have a real bad run of luck and have 10 losing trades in a row...your account balance would be $387.42 (down 61.25%)
Now to recover your initial balance, you need 7 wins in a row to get back to $1156.83 (up 198.60%)

So that's 7 wins in 17 trades (41.17%) for break even...Mystic's system doesn't seem to insane now does it?
(if we can't make 40% wins, then i guess we should quit forex)

Just something to ponder upon,
kevin

Mystic,

Congrats on finding your system!

give up medicine...live longer and better

Mystic,
Have you found Pin Analysis to work on 1 hour charts?
Rob.

Wow that's like going from $1 to $120! In only 10 days.... every trade must've been on the margin line lol

Re turning 1k into 126k, the key is whether it can be repeated more than once, on average, per 126 attempts; if so, it is a positive expectancy system. The underlying method (timing of entries and exits) will ultimately determine whether or not this is the case.

As a hypothetical example, let's suppose – given a certain set of entry/exit rules – it can only be achieved once in every 200 attempts. Then we will win $126,000 once, and lose $1,000 on 199 occasions, for a net overall expectancy of –$73,000 across every 200 trials. So as we can see, while loss is limited to $1,000 per attempt, overall loss (risk) across repeated attempts is actually unlimited. This is also true with fixed fractional sizing: we can use stoplosses to limit our loss to 1% or 2% (or whatever) per trade, but overall loss is unlimited, because we can not manage the number of losses in a given sequence of trades. That is one reason why I decided to quit trading.

Of course if the method being employed ["The strategy is very simple with some fine nuances which I'll not be able to explain fully as I also use my intuition a lot. I use simple trend following strategy based on 4H, daily & wkly TF (PA as per James 16 thread)....."] yields big enough (e.g. $126k) wins, often enough, to exceed the high number of $1k blowouts, then it's a viable system. (Same applies with every system, of course).

Anyway, this is yet another example of how expectancy is related to entries and exits, and that MM operates completely independently. It's impossible to use MM to rescue a negative expectancy system.

With high leverage, fast turnover, and the required amount of luck, almost anything is possible – at least, once in a while.......

David

so... does that mean your back in trading??? LOL

hi david,


excellent concise exposition and presentation of expectancy theory.

i wonder how the expectancy would change in your hypo example if the single $126K win were reinvested in $1K increments and every succeeding win were similarly reinvested.

there should be an event horizon where the system either went bankrupt or took off to the moon and so there can be no summary statistical expectancy other than 0 or infinity for a system - as opposed to a finite set of trades.

as you also point out, systems require sequential trades, and will eventually always experience bankruptcy - since somewhere in time is a stretch of long enough negative outcomes for every system, no matter how good the system's risk profile. except, that is, for 100% winning systems. this is why the back or forward testing of normal systems is helpful and interesting but never definitive. (traders often do not realize that forward testing is just back testing with a different data set.)

one approach would be to evaluate the system over a finite number of trades; i.e. define the expectancy over 20 attempts.

but since mystic's method (not system) incorporates discretionary differences, it is not purely mathematical and can not be statistically modeled.

it would be interesting to somehow examine and evaluate the weight of each decision criteria that mystic uses. one could then possibly increase the expectancy of a finite number of trades.


after reading mystic's explanation of his discretionary trading method it seems to me that mystic's well conceived and well considered method is this:

- primarily use james16 pa techniques and imransait's lageurre trend approach on higher time frames, then step down to the four-hour and again apply imransait's laguerre and james16 pa, while also watching for good forex candle formations (those that do not use gaps), and all along the way watch out for trend lines.

- use the one-hour time frame to sharpen the entry because you really want the market entry to start going in your direction from the beginning. if it starts going against you, use hedging until the timing lines up, and do not use stops. for exits use fibs on higher time frames and also watch the laguerre. sharpen the exit with smaller time frames.

- pay attention to the session timing and be aware of the non-commercial cot to further stack the trade.

this entry is now loaded with everyone hopefully heading in the right direction, the entry is timed to not so easily get stopped out, the exit looks like it will happen after a good long run, so leverage up big and hope for the best.

good solid trading technique, except for the money management, but maybe the wild man leverage is ok since trades with everything lined up do not happen every week - why not maximize your outcome while risking a fixed amount?

sounds great to me. i see a smart patient entry and exit with managed quantified risk executed with an intuition of the market direction combined with some measure of luck. this is not some wild trade that can never be repeated.


great trade mystic!!

Thanks a lot Buddhi---Your summary of my methodology is great---I'm going to keep this for my own referral from time to time---
To Rob's question, pinbar in any TF can work, provided they are in right positions (for details, please refer to James 16 thread)---

Cheerios,

GL/GT

mysticgenie, are you working on turning that 126k into 10M since it is "house money"? I would bank the 26k then "let the 100k ride". It would be awesome if you could turn it into 10M and post the statement here.

Hi Buddhi

IMHO yours is an excellent post. I'd like to highlight some of the points and comment further.

"there should be an event horizon where the system either went bankrupt or took off to the moon and so there can be no summary statistical expectancy other than 0 or infinity for a system - as opposed to a finite set of trades."
Agreed, any system that uses escalating position sizes (e.g. Martingale, anti-Martingale; including less severe variations) must eventually blow out an account, because infinity is never attainable, while zero is finite. In a negative expectancy game, one must somehow ride one's luck and quit (fortuitously) while one is ahead. But it's like playing Russian roulette: you never know which chamber (i.e. trade) is going to be the one that wipes you out.

Conversely, the key to avoiding ruin while exploiting a positive expectancy situation, MM-wise, is to keep bet size both tiny (relative to capital reserves) and consistent (assuming equal expectancy with each trial). Of course that's how casinos make their astronomical profits.

"i wonder how the expectancy would change in your hypo example if the single $126K win were reinvested in $1K increments and every succeeding win were similarly reinvested."
Of course there's no reason to stop at $126k, that's just an arbitrary figure. But the "Russian roulette" idea still holds good. (Note: Tdion discusses a similar idea in his thread: http://www.forexfactory.com/showthread.php?t=11566).

It's true that after the $1k has been recovered, we are playing with the "market's" money, but every time we start over we must risk another $1k.

".....this is why the back or forward testing of normal systems is helpful and interesting but never definitive. (traders often do not realize that forward testing is just back testing with a different data set.)".
Excellent, I agree totally.

"but since mystic's method (not system) incorporates discretionary differences, it is not purely mathematical and can not be statistically modeled."
No discretionary system can be automatically back-tested, for obvious reasons. (I won't digress here, especially because I plan to soon post an essay on why I found both mechanical and discretionary systems to be unworkable…. another reason why I've given up attempting to trade).

Just because a method can't be mathematically modeled, doesn't mean that we can't analyze its results statistically, and define expectancy, confidence levels, standard error, etc.

"after reading mystic's explanation of his discretionary trading method it seems to me that mystic's well conceived and well considered method is this:...."
I don't doubt that the system is well-conceived. The question that nags me about every method (and I've done this point to death on the forum, somebody please shoot me ) is that a method can only be as effective as there are future occurrences of the same non-random patterns that it seeks to identify. The more unpredictable price movement is, the more impotent any method becomes, no matter how many seemingly "independent" rules there are, how logical or well-conceived they might appear, and whether market conditions appear to be "all lined up". The more conditions that must be met before a trade is executed, the lower the number of trades in a given time period, and the slower the path toward attaining statistical confidence.

"sounds great to me. i see a smart patient entry and exit with managed quantified risk executed with an intuition of the market direction combined with some measure of luck. this is not some wild trade that can never be repeated."
This is assuming that Mystic's discretionary method delivers significantly positive expectancy. Even if that's the case, the overall expected result is no different whether we use small, consistent bet sizing or an escalating betting system; the latter will simply improve both the probability of a one-off, life-changing winning sequence, and a large number of losses whose eventual sum will be an amount of similar magnitude, in approximately equal proportion.

David

No I'm not---Greed causes downfall--I'm enjoying my winnings now---I'll start again small & will try to go big--rather than starting big (then you may end up with small return, say, 100k to 1 k instead of 10 M--lol)

Peace,

GL/GT

Is this just one of your lucky runs? How many times have attempted this and failed? You should mention how many times you've failed so the newbies reading this don't get the wrong impression. How about trying for 1M from 10k? 10k is less than 10% of your net profit from this run.

really I only have one question... could I be your IB for just one week LOL; man do pull the trigger on some trades!! holy krakatoa

Nothing wrong with this style of trading although i never made as much over a short space of time i have made tremendous gains over some time frames. It stands to reason that if you can lose tens of thousands in one day you can also win that amount too......its a two way street.

But if you are going to trade this way then set aside a tiny sum of cash that you expect to lose and see just how far you can run with it. The trick is to pretend its only demo cash once you see large numbers otherwise you will make stupid fear induced mistakes. Whatever way you look at it the risk reward is excellent and thats the key. Money man in the true sense matters not because we are gambling 100% the small stake.

The good news is assuming this was a real account then at least FXCM actually pay out for winning streaks.

Notice the close and reverse mentality. I'm as skeptical as the next person but these are good tech trades.

Let's attempt to clarify further with a simple analogy.

Suppose we have a "50-50 system", and we need 10 successive wins, increasing the bet size, to achieve the desired result (e.g. $10k to $1m). Then the probability of success is 0.5^10 = 0.0977%, less than 1 chance in 1,000.

Now, suppose by having a whizz-bang method of entry and exit, we have a "60-40 system". The probability of 10 successive wins is 0.6^10 = 0.605%, which is still less than 1 in 100.

As a simplified analogy, let's check the expectancy over 4 trades, using anti-Martingale betting (double the bet size following every win; revert to the original bet following a loss). Then try using a fixed betting system, using the same average bet that we did with the anti-Martingale. The Excel-generated tables below show that expectancy is exactly the same (11.2) in both cases.

You can try this using any betting system you wish. You can also try with different expectancies (e.g. 40-60, 70-30, whatever), and with any number of trials. The result will always be the same, proving the point that no matter how we size our bets, we can not alter expectancy.

Of course with trading, we are not just talking win/loss%, but also average net win/loss size. This complicates the math significantly, but doesn't alter the underlying principle. The only way to improve expectancy is to somehow gather more pips by making more profitable entries and exits.

People play the lottery in the hope of winning a life-changing amount. While they might realize that the odds are millions to one against, they underestimate just what a HUGE number a million is, probably because it's all too easy to write a 1 with six 0's following it. Even though it's arguably worthwhile spending $5 every week to have a miniscule chance of winning a fortune, the "average" punter will always spend more money buying tickets than he ever will winning, and (similarly) even the big winner would eventually lose all of his winnings, if he lived long enough to spend all of it buying more tickets.

If I turned $1k into $126k trading, or indeed in any speculative activity, whether it was in a week, a year, or 10 years, I would count myself incredibly fortunate, and quit while I was ahead. But perhaps I am too conservative.

David

its funny how so many think you can turn 10k to a Mil just as easy as 100 bucks to 10k. One of the main reasons is the brokers radar. If you make large gains but are below the average of the portfolio for that broker your trades will be fully automated and will clear through within 2 or 3 seconds. However, once you start trading over 100k you become the minority and will influence the portfolio of your broker and will then be put on manual. Your every trade then passes through to a dealer that then decides when your trade goes through. This can take well over 30 seconds on most trades once over 100k nor will stops and tps's work properly.

Bear in mind that almost all retail brokers aggregate all the mini lot accounts say 50,000 of them then and only then hedge out to the real market themselves to offset the risk knowing full well 90% of traders lose they will win. With only 10% winning accounts they will be about 3% of accounts which are large and troublesome for the broker and its these accounts that get the manual treatment as they pose a risk to their own hedge fund. So the bottom line is once you hit about 100k or notice fills over 5 seconds its time to take a fat profit and start again

hanover http://www.forexfactory.com/images/s...ser_online.gif your anti martingale is not really correct because there are many systems which are probability based and double up on losses. eg i have a system which has a PF of say 1.8 and over say 2 years the number of consecutive loses is 4 but the number of consecutive wins is 28. Now the number of actually single loss events is 895 while the winning trades is 1450 for my scalper. So with these stats i can afford to increase my next trade following a loss as much as TEN times knowing that out of 895 losing trades the next trade is very much likely to win by a massive ratio.

In this respect the losing streak has only happened 4 consecutive times in the past years yet the stats show loses are singular events in 99% of cases. In fact by increasing the risk following a loss just once then provides a massive gain to the account because the 895 loses are followed by 895 larger wins by scaling. In this respect loses CAN be turned into larger wins with probabilities in your favor but i recommend martingale is used wisely.