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Building an equity millipede

  • #6,861
  • Dec 21, 2014 5:28pm Dec 21, 2014 5:28pm
Quoting Pipskateer
{quote} That's very impressive and very encouraging! I took the liberty of adding some summary calculations at the bottom, the focus of which was to show the effects of the swap on performance and bottom line. I also modified the date fields to Excel format so I could use the data to figure total time in trade. In my calculations, I took the assumption that the win/loss count could be altered after the swap was considered. Thus, many pre-swap BE trades became losers and winners after swap was added. Of particular note was your short EURUSD trade...
Fascinating stuff. I also took the opportunity to delve back into that post of TheRealDeal's that you quoted. For me it brings up one of my main unanswered questions - to move the stop to BE, or not move the stop? This is something I plan to test extensively early in the new year and I will let you know the results.
  • #6,862
  • Dec 21, 2014 8:10pm Dec 21, 2014 8:10pm
Quoting zznbrm
{quote} It is just simple arithmetic. It all boils down to how you manage your net position. Given identical entries/exits, there will be no difference in Account Equity given the different account types: Hedging, Non-hedging, FIFO, non-FIFO. And the net position in each of those accounts will always be the same. There have been numerous threads about hedging/FIFO that include explanations of the math involved...some of those explanations might give you a better understanding.
But this doesn't account for the fact that you can't selectively choose WHICH positions remain open. For example, if you have a 10000 pip position that is the oldest and you want to take some short term profits, then you will end up closing the older position. What's left? The younger positions which are closer to market. In my view, these positions are more vulnerable. Yes, it's the same math-wise, but not the same as far as open positions being vulnerable to the market. Or am I missing something?

Perhaps you could compensate by putting some of the gains from the older cashed-out position(s) onto the younger ones to give them a wider SL...maybe that is what you are talking about?
  • #6,863
  • Dec 21, 2014 8:39pm Dec 21, 2014 8:39pm
Quoting soco333
{quote} Fascinating stuff. I also took the opportunity to delve back into that post of TheRealDeal's that you quoted. For me it brings up one of my main unanswered questions - to move the stop to BE, or not move the stop? This is something I plan to test extensively early in the new year and I will let you know the results.
I definitely look forward to seeing your results! Regarding moving the SL to BE... I have no problem doing that for all entry positions and then letting the market payout as it sees fit...I think that's beautiful. However, I cannot see the benefit to allowing a 5000 or 10000 pip position to return to BE and get taken out. If that happens, what did you gain from it besides some possibly negative swap and the joy of seeing it grow to such heights only to get snuffed out? Not gonna happen for me! Thus, I would amend Graeme's approach only slightly to suit my own tastes by adding a trailing SL to protect half the gains to any position which attained 5000 pips. That would lock in 2500 pips and give the market the opportunity to go still further. I would likely trail it by advancing the TS 1 pip for every 3 gained. This way, you're sure to capture short, medium, AND long term gains.
  • #6,864
  • Dec 22, 2014 1:59am Dec 22, 2014 1:59am
Quoting Pipskateer
{quote} But this doesn't account for the fact that you can't selectively choose WHICH positions remain open. For example, if you have a 10000 pip position that is the oldest and you want to take some short term profits, then you will end up closing the older position. What's left? The younger positions which are closer to market. In my view, these positions are more vulnerable. Yes, it's the same math-wise, but not the same as far as open positions being vulnerable to the market. Or am I missing something? Perhaps you could compensate by putting...
No he's talking about the following:
If you have i.e. an old lot with 10000 pips profit and a new lot with 1000 pips profit, in total you have 11000 pips profit.
Now if you close 1 position you're 10000 pip profit lot will be closed and you're 1000 pip profit lot will remain, but you still are in 11000 pips profit.
If after this the market goes against you and you will have -1000 pips on the remaining lot, you still are 9000 pips in profit, and you can keep this lot going as if it was the old lot.

You see? it virtually doesn't matter wich one is closed first, you simply have to do you're own bookkeeping (don't know if this is good english lol) and track you're trades on an excel sheet outside of you're trading software.
Persistence will get it. Consistency will keep it.
  • #6,865
  • Dec 22, 2014 2:34am Dec 22, 2014 2:34am
Quoting Chake
{quote} No he's talking about the following: If you have i.e. an old lot with 10000 pips profit and a new lot with 1000 pips profit, in total you have 11000 pips profit. Now if you close 1 position you're 10000 pip profit lot will be closed and you're 1000 pip profit lot will remain, but you still are in 11000 pips profit. If after this the market goes against you and you will have -1000 pips on the remaining lot, you still are 9000 pips in profit, and you can keep this lot going as if it was the old lot. You see? it virtually doesn't matter wich...
Yes, I understand that. That is why I said at the end, you could use the profits from the closed older position to buy a larger stop because the newer position's open price will be closer to current market than the older one closed out. As such, it will be in more danger of getting stopped out. The account value isn't affected, I get that. Instead of having 10000 pips of floating equity you will have 10000 pips of profit added to your cash balance. Same net profit either way, with or without FIFO. I think we're actually saying the same thing. Thanks for the post.
  • #6,866
  • Dec 23, 2014 4:53pm Dec 23, 2014 4:53pm
Quoting cameron1st
{quote} I personally do not move SL to BE, I mean think about the stats that PipEasy presented in which only 2% of the trades became mature legs. Would it not be stupid to get taken out of a trade that is part of those 2% just because you were hoping to 'save' 30 pips and move SL to BE ?
There is no real point saying one works better than the other without bringing data.

In saying that though, I personally don't move stop to be unless I have a decent distance between price and entry. But I use my own method of entry, and graeme had his own.
  • #6,867
  • Dec 23, 2014 5:53pm Dec 23, 2014 5:53pm
Quoting Pipskateer
{quote} I definitely look forward to seeing your results! Regarding moving the SL to BE... I have no problem doing that for all entry positions and then letting the market payout as it sees fit...I think that's beautiful. However, I cannot see the benefit to allowing a 5000 or 10000 pip position to return to BE and get taken out. If that happens, what did you gain from it besides some possibly negative swap and the joy of seeing it grow to such heights only to get snuffed out? Not gonna happen for me! Thus, I would amend Graeme's approach only slightly...
This depends on your preferencies. I personally don't see any reason why not to take at least partial profit if market struggles to break some level. If you have a look on EURUSD you can notice that to make 200pips is really easy. Not problem to hit it 5-10 times per month if you trade S/R levels like I do. In that case you can make enough if you don't see market moving.

This method is really difficult to trade, psychologicaly. Take the main idea - if you hold position for enough time you can make a ton of money and lock most of your positions on BE (depending on SL size-wide SL= many trades closed in small profit, tight SL= many SL hit but bigger positions and therefore bigger profits if it goes your direction).

I think you shouldn't take graeme's method as axiom. You should find what is the most beneficial for you. I personally take many smaller profits (100-200 pips). It is not equity building as discribed in this thread but it is easier for me.

Take ideas from this thread and build very profitable system. I'm sure you will...

Merry christmas
Lose small, win BIG
  • #6,868
  • Dec 24, 2014 12:26pm Dec 24, 2014 12:26pm
Quoting ProsteJa
{quote} I think you shouldn't take graeme's method as axiom. You should find what is the most beneficial for you....Take ideas from this thread and build very profitable system. I'm sure you will... Merry christmas
I agree, we should take what is beneficial, but I also believe there comes a point where altering a system goes too far and the original system is no longer discernible. The only part that Graeme really left up to our discretion is the focal entry method. The rest was purposely designed into the strategy for specific reasons that made it work as an equity building machine. I will be very selective about altering anything.

Merry Christmas and a Happy New Year to you too!
  • #6,869
  • Dec 26, 2014 7:07am Dec 26, 2014 7:07am
Quoting zznbrm
{quote} Or you can create your own front end and allow the FIFO-restricted broker to "act" as the back end. In this way, you can have any number of trades open (in either direction), close any trade you want (in any order), and allow the broker to handle the FIFO mess. When done correctly, it is as if the FIFO/hedging restrictions do not exist. Remember, the bottom line (equity) is the same whether using FIFO or not. In many ways the Account Balance does not really matter...it's all about the Account Equity.
Petition to repeal US/Hedging Rule: http://www.trade2win.com/boards/fore...fifo-rule.html

Dear friends,

I wanted to let you know about a new petition I created on We the People, a new feature on WhiteHouse.gov, and ask for your support. Will you add your name to mine? If this petition gets 100,000 signatures by October 19, 2014, the White House will review it and respond-

You can view and sign the petition here:

http://wh.gov/ilWF8

Here's some more information about this petition:

Petition to repeal NFA Compliance Rule 2-43(b) for FIFO / Offsetting Transactions for ForEx trading

I wish to express opposition to NFA Compliance Rule 2-43(b) concerning Offsetting and FIFO (First In-First Out) Transactions and call for the repeal of this section as it pertains to retail-level ForEx trading for US residents and brokerages. This rule has since prohibited the freedom to utilize beneficial trading resources such as offsetting (commonly referred to as 'hedging'), as well as the freedom to close each trade, choose take profit, stop loss and trailing stop values for each order without the interference currently caused by the FIFO aspect of the rule. I did not ask for these restrictions and firmly disagree that those freedoms now prohibited 'were of no benefit to the trader'. I believe that restoring these freedoms will help ForEx clients manage trades more successfully.

short video at
Inserted Video
  • #6,870
  • Edited 10:05pm Dec 27, 2014 1:12pm | Edited 10:05pm
Quoting pipEASY
Good morning, all Its early morning here in Sydney. Woke up to check on my progress. I had 10 buy positions before I went to sleep. 9 hit TP of +100 each Kept 1 position for free. SL @ BE. My total realized loss for this endeavour was -124 pips before TP was hit. Total net profit +776 pips for the last 2 days {image} Im currently looking at sell opportuntities. Will continue to update I also reset my realized loss counter and starting afresh in my mind. Sincerely, Graeme

Dear Mr. Graeme...

I don't know where you are, if you ever read this thread, or if you will ever come back to say hello. Likely not, and you cannot be blamed if you do not. But I still have to say this teaching progression you did (and the others before it) was just absolute TRADING MASTERY!!!!!

If one were to read this entire thread 100 times over, there would not be one single SECOND of wasted time. Thank you for sharing your knowledge and expertise and your "focal perceptions." I will do my best to honor your contribution with an equal effort to utilize and not squander what you have freely given here. THIS time...
  • #6,871
  • Dec 28, 2014 7:47am Dec 28, 2014 7:47am
Dear Pipseasy,

Personally, I think this thread's brilliant. One problem. I'm coming to it in the end of December 2014, when it's four-odd year's old. None of the charts are still charts (they're a video advertisement.)

Any way I can see your original charts?

Wheaters
  • #6,872
  • Dec 28, 2014 11:22am Dec 28, 2014 11:22am
I am still reading this thread, but would like to ask if anyone saved the charts posted by PipEASY can is willing to share? appreciate it. Thanks
  • #6,873
  • Dec 28, 2014 5:13pm Dec 28, 2014 5:13pm
Guys all the charts can be found in the PDFs linked to by Pipskateer. See http://www.forexfactory.com/showthre...74#post7943674
  • #6,874
  • Dec 29, 2014 8:01am Dec 29, 2014 8:01am
Quoting empowers90
Guys all the charts can be found in the PDFs linked to by Pipskateer. See http://www.forexfactory.com/showthre...74#post7943674
Thanks a lot for linking me to that page
  • #6,875
  • Dec 29, 2014 8:03am Dec 29, 2014 8:03am
Those PDF's contain most or all (not sure) of the charts and photos from pipEASY through post #3485 on November 7, 2010. He made several more posts after that and I haven't looked at those to see if there were charts originally posted. If there were, then as far as I know, no one has archived them. All credit goes to flyer415 for compiling and uploading these valuable files. If he had not done this, then all of pipEASY's charts would have been LOST.

THANK YOU for your efforts, flyer415!!
  • #6,876
  • Dec 29, 2014 1:41pm Dec 29, 2014 1:41pm
Building an Equity Centipede - first attempt.

Millipede is too much for me ... I'm trying to automate a Building of Equity Centipede, and here is my first attempt (EURUSD, daily, from May)
Attached Image(s) (click to enlarge)
Click to Enlarge Name: EURUSD-Graph.PNG Size: 14 KB
Click to Enlarge Name: EURUSD-Report.PNG Size: 20 KB
  • #6,877
  • Dec 29, 2014 2:37pm Dec 29, 2014 2:37pm
Anyone still using this philosophy, with real account?
  • #6,878
  • Dec 29, 2014 2:43pm Dec 29, 2014 2:43pm
Yes..I would say so. It seemed to get a shot in the arm in the other thread recently by Fezmar. I saw you posting over there.. are you not a believer? lol
  • #6,879
  • Dec 29, 2014 2:46pm Dec 29, 2014 2:46pm
Quoting marypipins
Yes..I would say so. It seemed to get a shot in the arm in the other thread recently by Fezmar. I saw you posting over there.. are you not a believer? lol

I have been taking concepts of the thread, not G's methods of entry and exit or hedging, and applying them to how I think about the market - with success for the moment.

Unfortunately I have not been holding onto positions as long as I should, my actual gain is some x4 less than it would have been if I had of kept holding positions which I established much lower in the trend. I also was adding new positions very conservatively.

I would reasonably have expected that anyone trying this philosophy and being a bit more ballsy than myself regarding the number of positions taken, and the length they have been held might well have doubled or even tripled their account.

Always lots of talk about the concept, but very little ever of people actually using it.
  • #6,880
  • Dec 29, 2014 2:47pm Dec 29, 2014 2:47pm
Swingman..you go boy!!!!
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