My path to heaven or hell

I have decided to go for the fences.I am currently in a financial dilemma for the next two years and wont be able to have much in savings.All I have saved is a small account that I have decided to risk it all.I have decided a life without taking CALCULATED risks is not worth living at all.Get rich or die trying they say...

I have decide to use 1/4 kelly for my position sizing.This will enable me to gain approximately 1000% a year without getting the famous margin call.Ruin levels are set at 50% where I will review if the system is still viable.At 35% draw downs I will shrink my size by half and if the losing streak continues I will continue reducing the size until I get my confidence back.This is not the mathematically correct way of doing it but its my observation that losing streaks tend to persist,also all of the old timers tend to agree with this method,so no need for me to re-invent the wheel here.

My system trades the trend and involves many pairs.i will take a maximum of 2 correlated positions at any one time.I hope my diversification will reduce my overall risk as I have noticed there is always a pair trending while others go int a ranging fit such as has been the EURUSD of late which has been an ass to trade.My system has been back-tested for 3 years and forward tested for 6months.So far the results match so i can say its fairly robust.It wins approximately 50% of the tome with a win/loss ratio of 2.The standard deviation of the system is low and according to Van Tharps system quality metrics its a very good system(over 3.1).Thats how much I can reveal about the system.

I know the goals seem outlandish but honestly I have scientifically tested the sytem.I know some gurus who say you have to backtest over 10 yrs of data and 10000 of trades.But the truth of the matter markets change and old results cannot be relied on.I have seen thoroughly backtested systems fail spectacularly in the real markets to know that backtesting isnt an exact science.My cure for this is that around 50% of my trades are based on discretion...so its harder to backtest.My discretionary trades are my most profitable trades and are very well founded on logic...I have only deviated once from this logic and never repeat again.

All of mt trades have a predefined SL.In all of my trading history I have always put a SL.I owe my survivability in this game for it.I have never come close to blowing my account even in my newb period coz Im paranoid...I always will be.In my mind I thinks of black swans regularly.Thats why I have used 1/4 kelly as I have found it the best compromise between reaching my targets and blowing out and I have a predefined Ruin levels which Im sure will be reached if I trade long enough from my montecarlo testing...I hope to have made a good wad as to reduce risk to the agreeable 2% by then.


Wish me luck guys.Probably if I blow I will disappear from this forum like the many before me.Cheers.

Good luck luck with this Pemully. Looks like you've done plenty of homework so hopefully it will pay off for you. Will be watching.

Pemully .......... It does appear you have given this much thought & I wish you the best in your journey.

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Hey Pemully,
Wishing you all the best in this " burning the bridge- fight to win or die- strategy.
A man is got to do what he's gotta do!

Danny

If you want to make it big in this game, at some stage you have to swing for the fences - many of the worlds top traders and investors went broke more than once on their journey. I agree with you about testing on historic data - the markets are not what they were 6 years ago, and those market conditions are probably never coming back. To succeed you need to be thinking two steps ahead of the market, not two steps behind. Good luck.

Thanks guys,so far Im thinking whats gonna go wrong not right.I have recreated the emotional damage I might undergo using an experience in 2008 in the stock market crash where I lost 60% of my life's saving.It took me 2 months to emotionally recover fully but I was in hell during those those dark days.

To me this is like going to war,I might not return but let it be remembered that I fought courageously.I will never martingale,move stops or over trade.Victory is on the other side and its either heroes corner or triumph.

I will be meditating and doing self hypnosis to try and mitigate the emotional roller coaster Ill have to endure.The truth is that winnings don't excite me at all,but losing streaks wreck havoc on my psyche and thats why I intend to prepare myself thoroughly coz they are inevitable.

I am prepared to drink this cup of suffering...and I hope Ill be found worthy of it.

I love the game,always have....PAIN IS LOVE.

Hi pemully, all the best in your journey to success.

As you seem to have a system, my only advice to you is to test and retest your system every month or 3 months or so with fresh data, this will keep you in touch with it and maybe discover things you didn't see before.

Think how to remove risk from your trading and think how to stay in the market.

Good luck,
BT

Good Luck! I'm rooting for you.

I wish you all the best mate, hope you'll succeed. good luck

thanks guys.I will top up the account and sadly will have to go private coz the volatility is going to be crazy.however I will be showing the account progress periodically.

I will be showing the accounts progress on a monthly basis but not on a daily basis coz it might interfere with my trading.

regards

hi pemully,

All the best.
Started to watch your thread any update for End of June?

Cheers

Ati

Yep....June ended up not too well up 8%.apparently I tried using 1/4 Kelly position sizing but ran out of margin (oanda Asia has only 1:20) and the position I couldn't take ended up being a big winner. Now I'm trading on a lower leverage so I can take multiple positions if the setups occur.
I'm up 18% this month.

Thanks for the update. I think 8% for a start is very nice.
What do you mean Oanda Asia has only 1:20. On all pairs? I'm with Oanda US myself but the majors have 1:50?

Anyway all the best for this month.

BTW: is your trade explorer the one of this thread?

Good luck mate. Hope you will knock on heaven's door soon.

Really like to see updates

Good Luck....You might want to check out Michael Covel's books - Trend Commandments, Trend Following and The Complete Turtle Trader. He also has a free podcast on the iTunes store. The episodes are loaded with good info. He constantly talks about hitting home runs.

EXCELLENT!!!!! Any particular styles/methods? Guided stuff?

As a long time trader i suggest you stick to 1 market and trade the hell out of it.Each pair has it's own movements,and when you can learn and see how it moves you will win.Good luck.

Hey Pemully,
How is the progress for the first half of July?
DAnny

MIXED REACTION WITH YOUR MOVE!!...