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Rags to Riches in 10 or 20 Trades - Simplicity at its finest

  • #1,781
  • Jun 22, 2015 3:08pm Jun 22, 2015 3:08pm
Quoting michaelpelly
Do anyone realize what a 20 successful trades mean - like 20 trades in row with no losses and all of them to reach the target?! I've never witnessed such miracle ...
Sure, it's a dwarf account from which I trade micro lots, but it still counts as 71 consecutive wins.
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  • #1,782
  • Jun 23, 2015 1:38am Jun 23, 2015 1:38am
Try negative Risk:Reward of at least 10:1
Then maybe you will have a chance of 10 winners in a row...
otherwise this idea is ridiculous and a waste of time.

Risk 100 pips to make 10 pips
Good luck
  • #1,783
  • Jun 23, 2015 3:26am Jun 23, 2015 3:26am
I actually like the idea behind this, but what is not taken into account is the fact that 1 loss, fair enough.... 2 losses, regardless of where you are results in your 'account' blown.

for $50, is it worth a go?

Unfortunately, my R:R is not that easy to work out as I trade with R:R 2:1 most of the time, so my loss would always be 100% of the account to profiting 50% - just one loss would blow my account...
  • #1,784
  • Jun 24, 2015 11:10pm Jun 24, 2015 11:10pm
Quoting rolandW
I actually like the idea behind this, but what is not taken into account is the fact that 1 loss, fair enough.... 2 losses, regardless of where you are results in your 'account' blown. for $50, is it worth a go? Unfortunately, my R:R is not that easy to work out as I trade with R:R 2:1 most of the time, so my loss would always be 100% of the account to profiting 50% - just one loss would blow my account...
you dont understand how percentages work do you?

if you have £1000 - one loss at 50% you are down to £500

at £500 - second loss at 50% you are down to £250....

two losses in a row right there and you are still in the game.... i cant believe some people call themselves traders and cant even figure out how percentages work...SMH
  • #1,785
  • Jun 24, 2015 11:16pm Jun 24, 2015 11:16pm
Quoting TerryTibbs
{quote} i cant believe some people call themselves traders and cant even figure out how percentages work...SMH
I don't think it was a % understanding ... I am quite sure that he didn't read the thread in full to understand what is done here.
MT4/MT5 EAs/Indicators/Alerts coder
  • #1,786
  • Jun 24, 2015 11:25pm Jun 24, 2015 11:25pm
I'd also like to point out the danger of everyone sticking to the risk 50% to make 100% model. Even for the OP R2R it is not optimal to use these percentages.

Let me demonstrate:

assume R2R has a system that nets him 2:1 at about 60%-70% win rate. For simplicity lets say in the last 10 trades he has won 6 out of 10:

$50 start 2:1 with 50%/100% split.

$25 loss
$12.5 loss
$6.25 loss
$3.125 loss
$6.25 win
$12.5 win
$25 win
$50 win
$100 win
$200 win

ending balance $200

=========================
$50 start 2:1 with 40%/80% split.

$30 loss
$18 loss
$10.8 loss
$6.48 loss
$11.664 win
$20.9952 win
$37.79 win
$68.02 win
$122.44 win
$220.40 win

ending balance $220.40

Also using a 40/80 % split would mean if you had a win after a loss, it would not only return the loss but add more on top! whereas the 50%/100% model only brings you back to were you were the previous step.

Different R:Rs and win % will have their own optimum percentage split! just because the RATIO is the same does not mean the PERCENTAGES will act the same! choose the most optimal percentage risk for your own system. I am not a mathematical person so i am sure there are formulas to work this out for you given your trading stats but i just use an excel spreadsheet and input different numbers to see which model would work the best for my strategy.
  • #1,787
  • Jun 24, 2015 11:27pm Jun 24, 2015 11:27pm
Quoting FerruFx
{quote} I don't think it was a % understanding ... I am quite sure that he didn't read the thread in full to understand what is done here.
i dont think you have to read the thread at all, it was clear in the first post what was meant....
  • #1,788
  • Jun 25, 2015 3:09pm Jun 25, 2015 3:09pm
This post was started 2 years ago, but has anyone achieved the "$50,000 in 9 trades" target yet? If the answer is no, I find it very hard to believe. Those that have tried this and succeeded probably never cared to come back here. R2R, I am more of a conservative trader but I must say that I like the way you think. I am pretty sure I can win 9 in a row with a 2:1 RR. Won't be easy by any means but very very possible if I wait patiently for high expectancy setups and trade the daily chart ONLY (as I suck at lower time frames). I can afford to lose a trade a two as well, so that makes it a very doable project. I like this idea, and I've been thinking about it for these past few nights. I think the most difficult part of this project would be keeping my emotions in check as you get to the $12,800+ area. That may cause me to panic a bit. But if I can somehow control that and remember that I only have 100 bucks on the line, then I can do this. Hell, what's 100 bucks? Dinner for 2 and a movie with popcorn and sodas, that's about it. Totally worth it. Also, if you really want to be a Jew, you could just scalp the market for 100 bucks and use "house money" to play this.

R2R, I like the way you think. I'd like to see what you can come up with using a 1:1 RR. Any ideas?
  • #1,789
  • Jun 25, 2015 4:31pm Jun 25, 2015 4:31pm
Quoting incognito517
This post was started 2 years ago, but has anyone achieved the "$50,000 in 9 trades" target yet? If the answer is no, I find it very hard to believe. Those that have tried this and succeeded probably never cared to come back here. R2R, I am more of a conservative trader but I must say that I like the way you think. I am pretty sure I can win 9 in a row with a 2:1 RR. Won't be easy by any means but very very possible if I wait patiently for high expectancy setups and trade the daily chart ONLY (as I suck at lower time frames). I can afford...
Just a small correction but an important point, though you may already know. It's not necessarily "9 in a row" just 9 net wins despite how many trades taken.
As the lights go by so too do the shadows move
  • #1,790
  • Jun 25, 2015 8:08pm Jun 25, 2015 8:08pm
Quoting incognito517
This post was started 2 years ago, but has anyone achieved the "$50,000 in 9 trades" target yet? If the answer is no, I find it very hard to believe.
//----

admit upfront that i'm skatin on thin ice here, having not read the entire thread..... but the math in post 1 never appeared correct to me..... i'm not talkin about the math you clearly see like, 100 + 100 = 200....

i'm talkin about the math people usually don't see..... the marketinfo() math.... and if you just wondered what's marketinfo() math.... well there ya go......
//-----

all that aside, nothing ventured nothing gained as they say.... hard to see any harm in tryin..... in my mind, forexsaint is forexfactory's master at high reward style trading.....

and he has something so few do...... live explorers to back it up..........h
to trade and code, keep both simple... no call to impress....h
  • #1,791
  • Jun 26, 2015 1:44am Jun 26, 2015 1:44am
Quoting Matts Micro
{quote} Just a small correction but an important point, though you may already know. It's not necessarily "9 in a row" just 9 net wins despite how many trades taken.
Matt, yeah I figured. Hence why I said I can afford to lose a trade or two. Although it would be very hard to lose half of $12,800 in a single trade and still build up enough courage to take the next one at $6400.
  • #1,792
  • Jun 26, 2015 1:58am Jun 26, 2015 1:58am
Quoting hayseed
{quote} //---- admit upfront that i'm skatin on thin ice here, having not read the entire thread..... but the math in post 1 never appeared correct to me..... i'm not talkin about the math you clearly see like, 100 + 100 = 200.... i'm talkin about the math people usually don't see..... the marketinfo() math.... and if you just wondered what's marketinfo() math.... well there ya go...... //----- all that aside, nothing ventured nothing gained as they say.... hard to see any harm in tryin..... in my mind, forexsaint...
Exactly, there's no harm in trying. Low risk, very high rewards if it pays off. I'll check out ForexSaint's threads to see what ideas he has.
  • #1,793
  • Edited 5:16pm Jun 26, 2015 2:53pm | Edited 5:16pm
Here is my implementation of "Rags to Riches" idea:

- Account Starting Balance = 400
- Divide balance into 4 parts, 100 each (like having 4 sub-accounts)
- Trade 4 pairs, each pair on one sub-account (i.e. eurusd,gbpusd,eurjpy,gbpaud)
- SL is not fixed, it will be variable according to system used, so for one trade it can be 65, for another trade it could be 22 and so on.
- Position Size is calculated as to risk 50% of each sub-account on each trade
- 2:1 Reward-to-Risk ratio (or close enough as per system used)
- After each cycle, re-distribute the new balance into 4 equal parts, and repeat.

EDIT : As it is very unlikely for the 4 trades to open or close at the same time, I am going to handle each sub-account separately.

Regards,

Khalil
No guts, no glory
  • #1,794
  • Jun 27, 2015 4:43am Jun 27, 2015 4:43am
Do you guys have some some strategy for RR 2:1 ?
  • #1,795
  • Jun 27, 2015 11:13am Jun 27, 2015 11:13am
Quoting abokwaik
Here is my implementation of "Rags to Riches" idea: - Account Starting Balance = 400 - Divide balance into 4 parts, 100 each (like having 4 sub-accounts) - Trade 4 pairs, each pair on one sub-account (i.e. eurusd,gbpusd,eurjpy,gbpaud) - SL is not fixed, it will be variable according to system used, so for one trade it can be 65, for another trade it could be 22 and so on. - Position Size is calculated as to risk 50% of each sub-account on each trade - 2:1 Reward-to-Risk ratio (or close enough as per system used) - After each cycle, re-distribute...
//----

hey khali.... .... best of luck with your attempt.... there is no doubt in my mind that starting with only 100$, in 9 or less trades you could have 51,200$ or more.....

remember, the lot size must be calculated correctly.....

the lot size is not stated in post 1 but it is not-so-clearly implied.... and clearly incorrect..... to be honest, in the past 10 years i can not ever recall seeing a 'correct' lot size based on %risk formula.... there are plenty generic formula's but they fall flat on their face when applied to post 1.....

there are several other equally important details being overlooked in post 1...... those would be very time consuming to go into...
//------

one of the benefits for someone that both codes and trades all day, is that in an instant we can see cracks in a plan that might otherwise be overlooked.....

to plan it out well, consider that which is not normally considered....h
to trade and code, keep both simple... no call to impress....h
  • #1,796
  • Jun 27, 2015 12:16pm Jun 27, 2015 12:16pm
Quoting onemind
I started reading this thread from page one and noticed nobody has managed to get past the $10k point.
How about net wins, has anyone made up to 4? Managed to get 2 wins before it all came crashing down. It's good to see the thread back alive again
  • #1,797
  • Edited 2:31pm Jun 27, 2015 2:04pm | Edited 2:31pm
This concept does work, I've done it numerous times although not at risk to reward of 1:2 or using the high risk of 50%, but starting off with a few hundred then risking 20% or so each position of the initial starting balance, so for example if you start with 100, you would risk 20% of that initial £100 on any position over five positions, so you'd risk £20 for the next 5 positions to make £20 on each position or so until it's doubled up to £200, instead of 20% of the remaining balance of each win. Think positive, going for 1:1 each time, you will net a long row of wins then the odd loss instead of a few wins and a few losses @ 1:2, although you may be in profit going for 1:2 , I found going for 1:1 or just under 1:1 will overall net you more returns. A return of 100% per week is easily achievable with self discipline and the right entrys, as in waiting for them instead of chasing the market. You might have a few sell stops or limit orders set up and by wednesday none may have been triggered, this would send most over and get them chasing the market for an entry which in the end will only end in ruin. The key to this business is discipline of one self to follow your rules and having the correct entry, nothing else. Any slight deviation and you'll end up in the 95% or what ever percentage they say try and fail, going off this site though I'd say it's more like 98/99%.

Good luck.

GD.
  • #1,798
  • Jun 27, 2015 2:20pm Jun 27, 2015 2:20pm
Quoting hayseed
{quote} //---- hey khali.... .... best of luck with your attempt.... there is no doubt in my mind that starting with only 100$, in 9 or less trades you could have 51,200$ or more..... remember, the lot size must be calculated correctly..... the lot size is not stated in post 1 but it is not-so-clearly implied.... and clearly incorrect..... to be honest, in the past 10 years i can not ever recall seeing a 'correct' lot size based on %risk formula.... there are plenty generic formula's but they fall flat on their face when applied to post...
Thanks hayseed, I am a big fan.

I will plan this very carefully, not because of the money, but for the enjoyment.

Having 4 sub-accounts (or even more), should give better chances of master account survival.
Although I mentioned 4 pairs in my post, this is not static and can change according to opportunities that appear on other pairs, Gold included.

I am a robot guy. However for this project and due to the high risk involved (50% a trade), the system can not survive consecutive losses, so I am going to trade it manually, taking only A+ trades, on higher time frames (daily or weekly). It will take time, but I don't mind as this will be a small account (reminds me of your small matter ), which can grow into something or just fade away, However I will make sure to enjoy the journey either way.

I will certainly need (and develop) an EA or Indy to assist me in managing the sub-accounts, position calculation ... etc.

I might open a trading journal thread for this project, along with a TE.

Regards,

Khalil
No guts, no glory
  • #1,799
  • Jun 27, 2015 2:22pm Jun 27, 2015 2:22pm
I wlll say this also, a close friend of mine wanted to try forex a while back, I shown him how I do it and all that but the fundamental thing which made him lose his money was himself, it wasn't his entrys which were wrong as a few of them as I told him I had the same entry (limit order), it was the fact he was unable to accept a loss or accept what he thought was right actually wasn't going to pan out like he had hoped, and would sit there 'babysitting' it, so he'd move his stop just that bit lower on the off chance the market would turn, until he lost more of his account, then the revenge trading came and he got in long at resistance or short at support, anger clouds judgement and in a day he had lost a considerable %. The best thing from my opinion is, if you trade exclusively with limit or stop orders, set them up and forget about them and walk away from the screen if you have low discipline, go outside and or just do what I do, set up a few positions for the day in the morning or a few for the week and not bother checking them until after NY close each day, you are either right or wrong, no inbetween.

"I believe the market will hit this price and bounce away (limit order) or continue (stop order) and hit this price, or not". That's it. Right or wrong. It's all down to your entry.

Again, good luck.

G
  • #1,800
  • Jun 27, 2015 2:27pm Jun 27, 2015 2:27pm
Quoting GDR3k
I wlll say this also, a close friend of mine wanted to try forex a while back, I shown him how I do it and all that but the fundamental thing which made him lose his money was himself, it wasn't his entrys which were wrong as a few of them as I told him I had the same entry (limit order), it was the fact he was unable to accept a loss or accept what he thought was right actually wasn't going to pan out like he had hoped, and would sit there 'babysitting' it, so he'd move his stop just that bit lower or higher on the off chance the market would turn,...
Well said GD.

Market noise plays with your nerves and "clouds judgement".
No guts, no glory
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