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Ok, Lets do it - Developing a Highly Profitable System

  • #21
  • Nov 30, 2010 3:50pm Nov 30, 2010 3:50pm
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.
2% a year? Are you having a laugh?

What is the point?
  • #22
  • Nov 30, 2010 3:55pm Nov 30, 2010 3:55pm
So.... are you going to be Trend trading, Pattern trading, Break out trading?

What time frame you thinking about?

Are you going to scale in and out of the positions?

What kind of money management do you have in mind?

Stop losses, fixed, trailing, or a daily adjusted trail?

some some fuel for the fire.
  • #23
  • Nov 30, 2010 4:04pm Nov 30, 2010 4:04pm
The thing I'm trying to say is that if you have a system that has a genuine expectancy of 2%, you're 90% there. Anyone can make a system that had a median of 2% but a negative expectancy.
The nail that sticks out gets hammered back in
  • #24
  • Nov 30, 2010 4:12pm Nov 30, 2010 4:12pm
OK here are the results of a two trade a week system......
Results for 2009 and 2010 to date.
This is a market direction and time based method.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Screen shot 2010-11-30 at 2.06.24 PM.png Size: 175 KB
Click to Enlarge Name: Screen shot 2010-11-30 at 2.06.05 PM.png Size: 166 KB
  • #25
  • Nov 30, 2010 4:16pm Nov 30, 2010 4:16pm
Quoting tradestar1
So.... are you going to be Trend trading, Pattern trading, Break out trading?

What time frame you thinking about?

Are you going to scale in and out of the positions?

What kind of money management do you have in mind?

Stop losses, fixed, trailing, or a daily adjusted trail?

some some fuel for the fire.

Many good questions for Phase 2..


I think the answers from Phase 1 will lead to easier solutions in phase 2..

we already went over TF but will take a poll on that too..

I also feel the system will be best if we develop ways to identify when say the market is trending and then determine when to get on board.. or if we determine its ranging we adjust for those scenarios.. we could limit it to one type of scenario tho.. and again phase 1 might naturally lead us to find that something like a break out is the best strategy.. who knows
  • #26
  • Nov 30, 2010 4:33pm Nov 30, 2010 4:33pm
Quoting newyear498
I think the focus will have to ultimately be looking for high probability trades with good risk to reward goals.
Most working systems have a 45-55% success rate (I have friends who work for HFT firms). Retail traders typically favor 80%+ success rate systems which require big stop loses and which trade less often (thus being harder to accurately test).

It seems logical to favor 80%+ systems. The odds are in your favor, right? Few understand what expectancy is. The obvious choice is most of the time wrong.
  • #27
  • Nov 30, 2010 5:18pm Nov 30, 2010 5:18pm
Quoting Adal
Most working systems have a 45-55% success rate (I have friends who work for HFT firms). Retail traders typically favor 80%+ success rate systems which require big stop loses and which trade less often (thus being harder to accurately test).

It seems logical to favor 80%+ systems. The odds are in your favor, right? Few understand what expectancy is. The obvious choice is most of the time wrong.
Since you say retail traders prefer 80% + systems and since most retail traders lose, there seems to be a flaw in your logic to develop a winning system.
  • #28
  • Nov 30, 2010 5:45pm Nov 30, 2010 5:45pm
I think that this proposal will be a failure, most people here can not even get a 2% per year in forex market.
  • #29
  • Nov 30, 2010 6:22pm Nov 30, 2010 6:22pm
So all you need than is find couple profitable systems chouse one and improve it. instead of reinventing the wheel and start from scratch. So this is a big bump.. are there proven profitable systems there??
  • #30
  • Nov 30, 2010 6:58pm Nov 30, 2010 6:58pm
Quoting tradestar1
Since you say retail traders prefer 80% + systems and since most retail traders lose, there seems to be a flaw in your logic to develop a winning system.
So far 80% of the traders in this thread have huge doubts about building a system.. and since most retail traders lose maybe there is a huge correlation between that!

Opps the cats outta the bag :-p

Haha.. so for the 20% who believe this is a good idea maybe were the winners lol


Anyways.. the only way this thread is going to fail is if no one contributes positive ideas to the phases...

once I post phase 1, I will have to go ban crazy to anyone who doesn't support the idea of this thread.. because its already brought many of them lol...


I will post Phase 1 ASAP and I hope to see many supporter because right now I don't see many supporters WHERE ARE YOU AT!?!

if no one contributes to phase one I'll admit defeat and recycle this idea.. but it will be sad to know Forex Factory Traders can't work together




PS: tradestar1, I don't know where you stand in this thread I only quoted you because I had that interesting correlation.. anyways I don't even know if you directed that quote to me or the other guy.. just wanted to let you know for the record I wasent directing anything at you..



AWESOME.. Looking forward to phase 1..
  • #31
  • Nov 30, 2010 6:59pm Nov 30, 2010 6:59pm
Quoting iulli
So all you need than is find couple profitable systems chouse one and improve it. instead of reinventing the wheel and start from scratch. So this is a big bump.. are there proven profitable systems there??
I am sure this system will turn out to be a reinvention of a few systems as users will take ideas from there main system..

and hopefully the end result will be a simple system and not some crazy crap haha

but yes good observation
  • #32
  • Nov 30, 2010 9:49pm Nov 30, 2010 9:49pm
The only traders I know that can't make more than 2% per year are the ones that don't use a system, don't bother to back test a system before they use it or don't faithfully trade a winning system after they have back tested it. Without back testing you won't take the next entry after 7 losing trades and that may just be the winner you have been waiting for. People that say they can't make money in forex are usually the ones that won't put enough time in to learn to properly trade the underlying. It is not hard to build a winning system, it is what you do to maximize the system that really makes the difference. I think that is what we are looking for here.
  • #33
  • Dec 1, 2010 9:05am Dec 1, 2010 9:05am
Quoting newyear498
PS: tradestar1, I don't know where you stand in this thread I only quoted you because I had that interesting correlation.. anyways I don't even know if you directed that quote to me or the other guy.. just wanted to let you know for the record I wasent directing anything at you..

AWESOME.. Looking forward to phase 1..
No problem here

it will be interesting to see what phase 1 results are.
  • #34
  • Dec 1, 2010 5:25pm Dec 1, 2010 5:25pm
Hopefully more traders will join.. the more minds the better!
  • #35
  • Dec 1, 2010 7:10pm Dec 1, 2010 7:10pm
No Fixed Stop losses

YOu must have a Stop Loss Strategy, Fixed Stop Losses won't work.

You can use Retracement zones does'nt have to be Fibonnacci any % you want. ATR etc
All Assets NAS100 GLD BTC AUS JPY GBP All Time Return: 18.2%
  • #36
  • Dec 1, 2010 8:34pm Dec 1, 2010 8:34pm
A group of losing traders isn't going to magically band together to come up with a decent strategy, and what reason would a skilled trader have to share with a bunch of losing traders? I don't want to hold hands dance around rainbows, I want money. I get it by taking yours.
  • #37
  • Edited 8:54pm Dec 1, 2010 8:42pm | Edited 8:54pm
Quoting Mr J
A group of losing traders isn't going to magically band together to come up with a decent strategy, and what reason would a skilled trader have to share with a bunch of losing traders? I don't want to hold hands dance around rainbows, I want money. I get it by taking yours.
I like how you say "what reason would a skilled trader have to share with a bunch of losing traders?"

its a very similar question to "why would you want to waste your time going around on forums leaving negative comments?"
  • #38
  • Dec 1, 2010 9:22pm Dec 1, 2010 9:22pm
Are you aware you're basically just asking for a handout?
  • #39
  • Dec 1, 2010 9:40pm Dec 1, 2010 9:40pm
Reply to MR J: Anyone who doesn't want to contribute doesn't have to. But those of us who would like to work together would appreciate it if you would not waste our time with your negative comments. No one is asking for a handout, just the opportunity to work together. I for one agree that many heads are better than just one. What we don't have time to deal with is negativism.
  • #40
  • Dec 2, 2010 2:57am Dec 2, 2010 2:57am
Points are flying over heads.

This is far from the first time such an idea has been suggested, so if you are going to pursue this, you best look at the reasons why these endeavours typically fail. You may not appeciate my "negativity" (I consider it more a dose of reality), but a healthy perspective considers both positive and negative, and a good strategy will stand up to negative feeback.
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