DislikedThere is a reason that the default risk in the EA version of this strategy is 0.25% of the account. Risking more than this on this type of breakout strategy is not wise; however, your math is way wrong here. Essentially you are risking 20 days times 0.50% per day (2 x 0.25% for each session) of your account in this scenario which amounts to 10% of your total account balance in one month, not the numbers you suggest.Ignored
1. I dont care about what the metatrade-EA is doing because it cannot be profitable with metatrader. (virtual dealer plugin, order execution, bucket shop, delay, requote, etc.) THIS DOES NOT MEAN THAT THIS STRATEGY IS UNPROFITABLE
2. Sorry for my mistake in calculation, I will correct it now. Anyway the percentage is not important, but the actuarial expaectation (you can count it in pips for example). But if it is too complicated, here again: There are 2! trades per day: 1 London and 1 New York. 20 days per month. 20 * 2 = 40 trades. So if one is going in with a 1 pip SL there is also the spread of about 1 pip. So one is risking 2 pips per trade. Now there are 4 szenario:
1. SL @ BE
2. 1 pip SL
3. 2 pip SL
and
4. 140 pip win
The only thing that I said has been if everything is going wrong, one is loosing 40 times 2 pips. So 80 pips in 1 month. This is not bad if one is winning at least every 1.75 month (140 pips). The question is now how often are the 4 szenario happen? For this we need a statistical evaluation or we just go in because we believe that it is working or we do investing money in the forex-cfd market, because we are trusting tony. Thats it. The way I choose will be the statistical evaluation.
If i know for example that SL @ BE will happen 30% of the trades, 1 pip SL 10% of the trades, 2 pip SL 58% and a 140 pip win 2% of the trades, I will calculate:
0,3*(0)+0,1*(-1)+0,58*(-2)+0,02*140 = 1.54
In this sample the actuarial expaectation would be 1,54 pips per trade which is positive so I would trade, if its negative one is loosing over longterm, then I wont trade it. Thats it!
