there are a lot of threads about baskets theory and hedging , and there is always someone that reduce a basket to a cross .
it's obvious that it's not like you say , every pair move in differents way with different times and different amount of pips ......thats' not the case of usdjpy only .
there are a lot of threads about baskets theory and hedging , and there is always someone that reduce a basket to a cross .
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That reason is because its true. Learn about exposures and you will understand. If you dont believe me then go ahead trade that basket and watch usd/jpy. Your basket p/l will move in conjunction with what u/j does. Only difference is you paying spread on 6 pairs instead of one.
But maybe your EA doesnt trade it that way? Care to show some results?
That reason is because its true. Learn about exposures and you will understand. If you dont believe me then go ahead trade that basket and watch usd/jpy. Your basket p/l will move in conjunction with what u/j does. Only difference is you paying spread on 6 pairs instead of one.
But maybe your EA doesnt trade it that way? Care to show some results?
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it's not an ea i use, what i do is add positions to winning pairs ,
if audjpy is the best performer i add 1 position...and so on
See post 5. It works on the hourly time frame or shorter. I'm not sure what settings we would use for the period. Its default setting is 20 and seems to be accurately smooth. http://xrl.us/bmjthr
I've been searching on FF for a little while today and haven't found exactly what I'm looking for. Any help or discussion is appreciated. I'm posting in the rookie section simply because I have no evidence to back it up that the strategy will work. If anything it's just theoretical right now.
Essentially what I want to do is trade many correlated and inversely correlated pairs such that at a single time I may have many trades open which hedge one another. If the currencies were directly correlated then my risk would be zero. We know currencies...
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I am testing a similar strategy, it's called correlated martingale although my setup uses a open equity stop loss aswell.
The problem with the system is forex being forex means you are eventually going to have all trades in negative and hit SL.
it only takes one or two SL's in a row (it will happen) to completely wipe out any profits we've accumulated on my system, with your system the day is going to come when you have all trades in the red and a margin call.
The future of these systems could be in rebates. Let's say I make a small investment of £200 on my system which does .6 lots per day. Within 2 months it would cover itself so it doesn't matter if I loose the money, of course the problem is finding a decent broker as most of the rebate brokers are outright criminals. One positive factor is by having a equity stoploss we are not effected by spread widening tactics.
