Ok, Lets do it - Developing a Highly Profitable System | Forex Factory

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Ok, Lets do it - Developing a Highly Profitable System

  • Poll

  • Want to Build a Highly Profitable System?
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  • #1
  • First Post: Edited Jan 1, 2011 12:40pm Nov 29, 2010 8:28pm | Edited Jan 1, 2011 12:40pm
This thread has been abandon.. at least original idea.. to many people that want to contribute nothing because they have "secret" information that they are afraid to share.. so I would rather not build something great for them to use when they had nothing to contribute to us...

you can read the remains if you want.. but you would probably find it more useful to quickly realize that theres only a small 10% of truly insightful people around here who will aid you with knowledge about the market.. but there worth looking for
  • #2
  • Nov 29, 2010 9:36pm Nov 29, 2010 9:36pm
Hello ny,


I am also looking forward to this.

BTW, I also liked your style on the previous thread.

Seeing as I'm only a 'recently recovered overtrader', I don't want to say too much. But I quite like the Heiken Ashi and also Multiple T/F & GMMA.

I seldom post here but have certainly been a regular reader for a few years whilst getting my act together again.

My thanks to the many generous minded traders who give so freely of their time & knowledge; yourself included.

Regards
  • #3
  • Nov 29, 2010 9:57pm Nov 29, 2010 9:57pm
In my opinion (having "built" and discarded many systems), you will need to concentrate you efforts in three general areas. While these areas are ultimately linked together they should be addressed clearly before you begin construction.

  1. Risk Profile:This deals not only with stops and risk but also with position sizing and profit taking
  2. Entry/Exit mechanism: Highly probable entries are not nearly as important as eixts, and how that fits into the above risk profile
  3. Time frame profile: Practicality of trading smaller or larger time frames for those who want to spend time OUTSIDE the trading environment. Also how risk increases or decreases with time and what time frame used to trade.


As most of the above things are highly personal from one trader to the next using a "meeting of the minds" will certainly have challenges as each participant will have his/her own agenda and needs to fulfill. I don't see anything in your outline on how to address these issues.

  • #4
  • Nov 29, 2010 10:07pm Nov 29, 2010 10:07pm
Quoting CindyXXXX
reminds me of an idea i had the other day for a bit of fun.... Make a forex factory managed acoount. Evvery one chuck in 50 dollars or something then hae a roster of who gets to trade it for the day. haha before you pick me up on the obvious pitfalls it could actually happen through propper management.

Obviously its just a bit of fun with a touch of seriousness but imagine if we could actually build a 1million account over time through leverage of people. Even if everyones share is only small

I know Jackos ears just pricked up anyway
Lol what!?! that would be crazy haha..

Ok, I know your joking but for the record and everyone else this thread will only focus on system and there should be no attempt to create a hedge fund lol

  • #5
  • Edited 10:51pm Nov 29, 2010 10:40pm | Edited 10:51pm
Quoting gspajon
In my opinion (having "built" and discarded many systems), you will need to concentrate you efforts in three general areas....

as I noted all issues are going to be voted on and the majority will win.. so the majority will define the system.. those who are disappointed can freely tweak the core system to there liking though

There is not going to be a judgement of how much of your account % to risk people can risk 2% or .01% thats just too basic I feel.. maybe a simple rule like never more than 2% is recommended but again you can tweak the core

the risk to reward ratios and entry exits will be define in Phase 2

time frame will have to be voted on.. but since the system focuses on high profit we will have to keep that in mind voting.. most likely the system will be able to used in a few time frame regardless of the official one

phase 1: we are going to look more at the core as to defining a highly profitable system.. the goal will be just making a well rounded list of what were gonna focus on and how

so we will say things like.. where the big money is buying and selling is important.. momentum is important.. identifying the trend vs ranging is important.. until we narrow the list to what were gonna need in the system for it to be highly accurate and profitable

then when we get to phase 2 we will narrow down how were going to incorporate all of phase 1.. like.. heres the best way to determine momentum.. heres how were gonna determine where big money is buying.. entries we will need to identify a way to determine when the move is about to happen etc. etc


Theres no reason to get ahead of yourself tho.. if we jump around the system wont get built.. so phase 1 is all thats important now..

anyways phase 1 hasent really started yet I'll get to that..

I think you will find this thread will work.. if it means anything I used to be in the military and have experience leading groups of people.

This forum will certainly not benefit everyone but hopefully majority of people find it useful
  • #6
  • Nov 30, 2010 5:49am Nov 30, 2010 5:49am
Quoting newyear498
Hello Everyone,

Posting this thread to see if anyone wants to build a system together!?!

While there is much to say here is the quick and dirty...

I admire and commend your enthusiasm, and do not seek to remove the wind from your sails... but I could not help but notice some glaring assumptions in your first post that would would appear to be untested (ok, here I am making some assumptions about assumptions.. so perhaps I should eat my own words), yet still strongly guiding your intended course of action... My suggestion? Read your post again and again... and again. Note all of your assumptions.. and the thinking behind those assumptions. Then seek to find the evidence that would prove or disprove those assumptions. This may take you days, weeks and months. At the end of this process you will have more learning, knowledge and information than you ever could have hoped for, compared to the intention of "building a system." And maybe, just maybe, you will be headed in the right direction. I suppose I don't honestly expect you to take my humble advice but maybe someone will... such is the stuff that leads to the those critical "a-ha" moments in trading journeys.

All the best with your project.
  • #7
  • Nov 30, 2010 8:16am Nov 30, 2010 8:16am
Quoting Hedginghog
I admire and commend your enthusiasm, and do not seek to remove the wind from your sails... but I could not help but notice some glaring assumptions in your first post that would would appear to be untested (ok, here I am making some assumptions about assumptions.. so perhaps I should eat my own words), yet still strongly guiding your intended course of action... My suggestion? Read your post again and again... and again. Note all of your assumptions.. and the thinking behind those assumptions. Then seek to find the evidence that would prove or...
If I understand what you are saying I believe I already experienced.

For example as I was posting this.. I was thinking the same approach I'm using to layout the guidelines could be the same approach needed to trade a highly profitable system

if thats not what you meant then maybe you meant I already made some assumptions as to whats going to make a good system without questioning those assumptions.. and I see that as well but like I said I was laying the ground work for the first post and phase 1 is going to cover everything thats needed for a good system


Overall this thread will continue forward to building a system because while everyone of us can build our own system.. the focus is using all our minds to identify things each one of us might have otherwise overlooked.. we will learn from one another and work to achieve something each one of us may not be able to create as an individual

I would compare this thread to how mathematicians work in groups to discover equations.. we are working together to discover a highly profitable system


  • #8
  • Nov 30, 2010 11:18am Nov 30, 2010 11:18am
Posted a poll in the first post to see where our interest levels stand
  • #9
  • Nov 30, 2010 12:13pm Nov 30, 2010 12:13pm
Hi Ny, I'm interested and will follow and test if I can. Can you do polls on the thread? The script you gave took my vote I think, but also put me to a 'you can't vote more than once' when I voted for the first time.
  • #10
  • Nov 30, 2010 12:42pm Nov 30, 2010 12:42pm
A 2 percent per year system is a good start, and is harder to develop than you probably think. Show me a system that has a long run average return of 2% (including transaction costs) and we'll depart from that.
The nail that sticks out gets hammered back in
  • #11
  • Nov 30, 2010 1:15pm Nov 30, 2010 1:15pm
I think there are plenty of systems around that would attest to >2% annual return like most any of the decent breakout systems. I found years ago a KISS cable weekly breakout system. I think it might be on FF. I was trying to search for it, but there are a lot of different results searching for KISS.

Anyway the backtests for many years showed profitability although there were some flat years. I traded it live for three years risking 2% per trade and made approximately 20% per year with max drawdown around 20%. This last year has been flat. I still keep an eye on the performance but don't trade it live for now.
  • #12
  • Nov 30, 2010 2:36pm Nov 30, 2010 2:36pm
Quoting jmag
Hi Ny, I'm interested and will follow and test if I can. Can you do polls on the thread? The script you gave took my vote I think, but also put me to a 'you can't vote more than once' when I voted for the first time.
yeah seemed like a fail.. I can't get poll except on first thread and I didn't select it initially so not working.. oh well I will find a new solution

if anyone knows a good solution I'm open for ideas :-p
  • #13
  • Nov 30, 2010 2:41pm Nov 30, 2010 2:41pm
Quoting Noloqy
A 2 percent per year system is a good start, and is harder to develop than you probably think. Show me a system that has a long run average return of 2% (including transaction costs) and we'll depart from that.
you want a 2% a year system.. here it is..

step one.. locate a bank..

step two check there interest rates on CD's..

step three invest


my bank is giving me 2.5% a year currently

  • #14
  • Nov 30, 2010 2:44pm Nov 30, 2010 2:44pm
I would be interested in working to help create the 'mother of all trading systems'. I am constantly on the lookout for something that may work better than one of the systems I am currently using. I currently do a lot of back testing and would be willing to contribute in any way I can. I just recently joined The Forex Factory but have been using the calender and reading the forums for over two years. I thought maybe it was time I tried to give back for some of what I have learned.
  • #15
  • Nov 30, 2010 2:53pm Nov 30, 2010 2:53pm
Quoting newyear498
you want a 2% a year system.. here it is..

step one.. locate a bank..

step two check there interest rates on CD's..

step three invest


my bank is giving me 2.5% a year currently

That's actually pretty good. Better than my current returns, lol!
Enter Signature
  • #16
  • Nov 30, 2010 2:53pm Nov 30, 2010 2:53pm
So decisions will be made by majority vote... You do realize that most of the traders (and forumers) are losers, right?

It will be fun seeing losers outvoting winners (who will push things which go against "majority" consensus about what is best).
  • #17
  • Nov 30, 2010 3:06pm Nov 30, 2010 3:06pm
Found a good poll I think.. should work now
  • #18
  • Nov 30, 2010 3:16pm Nov 30, 2010 3:16pm
Quoting Adal
So decisions will be made by majority vote... You do realize that most of the traders (and forumers) are losers, right?

It will be fun seeing losers outvoting winners (who will push things which go against "majority" consensus about what is best).


I believe the majority of traders will offer what they find to be most profitable from there methods.. if they are losing traders they will still offer many hints on how not to lose money..

then after we have some solutions for whatever subject were on. the majority will vote on best solution for the system as far as that aspect goes... so basically whatever we are voting on will most likely contain several good solutions.. it will just be narrowing down which to use
  • #19
  • Nov 30, 2010 3:24pm Nov 30, 2010 3:24pm
Well I think the 1st step is define 'Highly Profitable'.
  • #20
  • Nov 30, 2010 3:36pm Nov 30, 2010 3:36pm
Quoting ForexQuant
Well I think the 1st step is define 'Highly Profitable'.
Good point,

I think the focus will have to ultimately be looking for high probability trades with good risk to reward goals.

It might also be best to simply avoid putting numbers on the words highly profitable.. for example not reach for 200% returns or set number..

I think by going through phase one we will start looking at what is required for a winning system and phase two will be about exploiting those requirements to the highest degree.. that should lead us to the highest profitable method

so in phase one we identify something as determining current momentum is important and in phase two we will identify the most accurate way to determine momentum.. etc. etc. for the other aspects

I feel for a highly profitable system we should not overlook recklessness of course.. so it should be highly profitable while remaining well calculated trades.

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