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No Loss Martingale Strategy

  • #161
  • Edited 4:03am Sep 21, 2015 3:49am | Edited 4:03am
There always is a good solution for a problem, but no body has found it yet
and you don't have to withdraw your profit every day, if you make your ea to have a stop loss, like this .
  • #162
  • Sep 21, 2015 4:16am Sep 21, 2015 4:16am
There is more than one mathematical reason because martingale systems can not work in the long run. Eventually they will blow up account, sooner or later, its mathematic. Law of large numbers doesn't lie. Take a sufficient number of events and the probability > 0 no matter how tiny is will reveal itself.

Think about the probability that random atoms combine themselves and make a living organism that can replicate himself.
Pretty low huh? Well, we are here so it happened.
  • #163
  • Sep 21, 2015 8:48am Sep 21, 2015 8:48am
Quoting She1
There always is a good solution for a problem, but no body has found it yet and you don't have to withdraw your profit every day, if you make your ea to have a stop loss, like this .
yep stop loss is needed. and hedge position will reduce drawdown.
LUCKY golden trades, LUCKY gold investor trading style
  • #164
  • Sep 21, 2015 8:14pm Sep 21, 2015 8:14pm
Quoting kevler
please comment on this . I would consider this as discussion similar to research and academic related.
Sure, I'll comment: this discussion is really not similar to research/academics.

If you'd like to read an academic discussion, I suggest you pick up a peer-reviewed journal in finance.
  • #165
  • Sep 21, 2015 8:36pm Sep 21, 2015 8:36pm
Quoting Copernicus
Great post Ash :-) Here is an interesting interview with a world class poker player Annie Duke. Look what she has to say about 'tilt' and relate this to trading and in particular, how many people deal with painful risk events....namely what happens when Murphy's Law kicks in or when your Martingale progression turns sour despite the elaborate methods employed to attempt to overcome losses. It offers a different way to view things and...
Listening to that interview at the moment, thanks for sharing. Funny thing is, I've always thought in probabilities/expectancies for basic life stuff - without considering that most people don't think that way. As a statistics-lover, I was also (obviously) briefly interested in poker, so this is quite a fun interview for me.
  • #166
  • Sep 21, 2015 8:44pm Sep 21, 2015 8:44pm
Quoting AshR
{quote} Listening to that interview at the moment, thanks for sharing. Funny thing is, I've always thought in probabilities/expectancies for basic life stuff - without considering that most people don't think that way. As a statistics-lover, I was also (obviously) briefly interested in poker, so this is quite a fun interview for me.
I was blown away by the direct relevance to trend trading. She could easily find a nice home in the CTA space. I note she provides advice at hedge fund retreats :-)
  • #167
  • Sep 21, 2015 10:49pm Sep 21, 2015 10:49pm
hey she1, my friend already solve the problem he have good martingale ea... but unfortunatelly he made it for sale..
here the difference between his ea and another martingale ea
1. good money management: % lot of equity and % profit target per day (if the profit target reach ea stop trade, and will trade again next day).
2. time to trade: ea not trading everytime, it just open at the right time and stop when target reach (it doesnt trade at friday big news)
3. Its only trade pair eu and gu
4. His EA can makes 30% - 200 % per month (depend on equity, small equity get big profit but very risky, big equity get small profit but very safe)
5. still he need to check and control his ea everyday until target profit reach

this is just my analysis about his great martingale ea

sorry for my bad english
  • #168
  • Edited 2:03am Sep 22, 2015 1:45am | Edited 2:03am
Quoting johan4292
hey she1, my friend already solve the problem he have good martingale ea... but unfortunatelly he made it for sale.. here the difference between his ea and another martingale ea 1. good money management: % lot of equity and % profit target per day (if the profit target reach ea stop trade, and will trade again next day). 2. time to trade: ea not trading everytime, it just open at the right time and stop when target reach (it doesnt trade at friday big news) 3. Its only trade pair eu and gu 4. His EA can makes 30% - 200 % per month (depend on equity,...
there already are some EAs with those abilities, if you increase safety the profit will reduce very much and there still is an almost big stop loss !i have shared many good EAs here and probably most of them are better than your frien's EA, and of curse their free! so the problem is not solved my dude...
  • #169
  • Sep 22, 2015 2:55am Sep 22, 2015 2:55am
Quoting Mag357
There is more than one mathematical reason because martingale systems can not work in the long run. Eventually they will blow up account, sooner or later, its mathematic. Law of large numbers doesn't lie. Take a sufficient number of events and the probability > 0 no matter how tiny is will reveal itself. Think about the probability that random atoms combine themselves and make a living organism that can replicate himself. Pretty low huh? Well, we are here so it happened.
What happens if we simply remove our expectation of anything working or failing in the long haul? Martingale alone won´t determine if you win or lose in the long or even short term, but the actual system which is used shall determine that. If we can look at systems which don´t incur many losses in a row, and we try to find variations of said system to decrease the losses, then we can use martingale effectively.
  • #170
  • Sep 22, 2015 3:07am Sep 22, 2015 3:07am
Quoting AshR
{quote} Listening to that interview at the moment, thanks for sharing. Funny thing is, I've always thought in probabilities/expectancies for basic life stuff - without considering that most people don't think that way. As a statistics-lover, I was also (obviously) briefly interested in poker, so this is quite a fun interview for me.
It would seem rather outlandish to live life based on probabilities. As you have many out side influences which can throw a screwball into the calculation at any time. They say that it is more probable to fall in your bath tub compared to dieing in a plane crash, but do more people take a shower or travel via plane? Stats don´t work in the real world only because outside influences arent calculated in the expected result. Pocket Aces has a better chance of beating pocket 2s but if you are in a table of 10 and no one folds, then the odds are that those pocket 2s would lead to a triple, boat, or poker compared to if you only have say 3 players on the table, but of course that isnt calculated in your odds of winning. A real poker player would know this seeing that no one has folded and would should at least pay to see the flop compared to if their were only 3 people in the hand.
  • #171
  • Edited 3:50am Sep 22, 2015 3:39am | Edited 3:50am
Quoting WhyDrawdown
{quote} It would seem rather outlandish to live life based on probabilities. As you have many out side influences which can throw a screwball into the calculation at any time.
I will ignore your irrelevant/wrong examples and address your theoretical point.

Yes, there are very rarely unknown factors and probabilities, but most of the time you have a set number of possible outcomes and it's possible to derive your expected outcome based on the very simple E(x) = np formula. Your "out side influences" form part of the set of possible outcomes and should therefore have already been included in your calculation.

The probability of "many out side influences which can throw a screwball into the calculation at any time" existing, in itself, is usually quite low - unless you're referring to black swan events. Or, as I referred to above, Murphy's law. And it's impact on martingale-type strategies.
  • #172
  • Sep 22, 2015 3:52am Sep 22, 2015 3:52am
Quoting AshR
{quote} I will ignore your rather irrelevant/wrong examples and address your theoretical point. Yes, there are very rarely unknown factors and probabilities, but most of the time you have a set number of possible outcomes and it's possible to derive your expected outcome based on the very simple e = np formula. Your "out side influences" form part of the set of possible outcomes and should therefore have already been included in your calculation. The probability of "many out side influences which can throw a screwball into the calculation at any...
Black swan effects, for the simple fact that they COULD happen, makes the stats useless which is my overall point. The fact that a black swan effect can happen at the very next market tick leads one to assume that the longer you are exposed to the market, the higher your chances are of get cleaned out due to a ton of factors...
  • #173
  • Edited 5:27am Sep 22, 2015 5:12am | Edited 5:27am
Quoting WhyDrawdown
{quote} Black swan effects, for the simple fact that they COULD happen, makes the stats useless which is my overall point. The fact that a black swan effect can happen at the very next market tick leads one to assume that the longer you are exposed to the market, the higher your chances are of get cleaned out due to a ton of factors...
Applying a rigid principle of created certainty to deal with uncertainty is destined to fail. To round up 99% to 100% certainty are the reasons for the spectacular demises of our supposed cleverest creations that attempt to 'rig' unpredictability from the Titanic to a simple Martingale progression. It is the failure to appreciate the power of statistics in the form of risk uncertainty that creates these illusions.

It's the reason that casino's prosper, the reason why people hedge their bets with insurance and the reason that a whole industry such as the trend following CTA's obtain their spectacular performance results from market divergence also referred to as crisis Alpha events. I am yet to see demonstrated proof of a sizable segment of the fund management sector deriving their alpha from market convergence such as Martingale betting programs. It is not to say it can't occur as this is what uncertainty means, which also means a broken egg could reform back into a perfect egg but it is extremely unlikely, but expectancy or an edge IS a gross statistical measure that lends powerful weight to the reality of complex systems as much as we might want to deny it.

Simple Martingales are fine provided you recognise that your performance is in the total hands of chance..... but there are many variations of a Martingale approach, some of which can be played with positive expectancy and it is in those style of systems where at least you can 'cook' the books and call them trading systems such as limited Martingales or periodically applied Martingales that are MM techniques supeimposed upon a basic system offerring positive expectancy. This is where Martingales have their benefical application provided they are used judiciously.
  • #174
  • Sep 22, 2015 5:50am Sep 22, 2015 5:50am
Quoting She1
{quote} have you been success? i use tradersway, what broker do you use? and do you know about exness and their cent account?
i dont trust exness, they used to change leverage on friday which could be risky for your account. I would recommend FBS for cent account.
LUCKY golden trades, LUCKY gold investor trading style
  • #175
  • Sep 22, 2015 6:07am Sep 22, 2015 6:07am
Quoting Copernicus
{quote} Applying a rigid principle of created certainty to deal with uncertainty is destined to fail. To round up 99% to 100% certainty are the reasons for the spectacular demises of our supposed cleverest creations that attempt to 'rig' unpredictability from the Titanic to a simple Martingale progression. It is the failure to appreciate the power of statistics in the form of risk uncertainty that creates these illusions. It's the reason that casino's prosper, the reason why people hedge their bets with insurance and the reason that a whole industry...
+1 I am not sure how you feel about Casino vs Forex, but one should not compare the other. The reality is all casino games are bet on chance and random events occurring. The casino has the edge because they set limits on their tables, they have massive bank rolls and because the player doesn´t realize that the outcome was completely random. Here is a perfect example about playing ODDS or Probability.

Inserted Video


Imagine all the possible outcomes prior to the player getting on the river 4 9´s... Although we have the ability of seeing the cards, the reality is if you flop a boat, almost no one would fold it. The leaderrs form of wagering, allowed him to fish and bait the other guy into keep playing. That is what happens in forex. Our judgement gets so clouded by our bias, that we ignore the basic rules of price action. Picking tops and bottoms goes against the rules of price action which is why at times we win, and most times we lose.
I believe if we stick to price action patterns and trying to master the lower tf´s WHICH CREATES everything we see on the higher TF, then maybe martingale can stand a chance as it would only be your money management to be a complement to an accurate system.
  • #176
  • Sep 22, 2015 6:10am Sep 22, 2015 6:10am
Quoting fx4money
{quote} i dont trust exness, they used to change leverage on friday which could be risky for your account. I would recommend FBS for cent account.
Do you even know WHY exness LOWERS the leverage prior to market close on friday? They do that to avoid tilt monkeys to go all in prior to market close with 1000:1 leverage and if lucky the trader doesnt margin call prior to market close, and should the market gap against the trader, then exness won´t be holding the bag with a negative account balance. Remember... If you go all in (100% equity) with 1000:1 leverage then every 10 pips you earn or lose is 100% p/l So imagine you buy eu prior to market close for 100% equity and the market gaps against you 100 pips then the broker would assume the loss of your account....
  • #177
  • Sep 22, 2015 6:18am Sep 22, 2015 6:18am
Quoting WhyDrawdown
{quote} +1 I am not sure how you feel about Casino vs Forex, but one should not compare the other. The reality is all casino games are bet on chance and random events occurring. The casino has the edge because they set limits on their tables, they have massive bank rolls and because the player doesnt realize that the outcome was completely random. Here is a perfect example about playing ODDS or Probability. https://www.youtube.com/watch?v=Z6oqC9jCG2k Imagine all the possible outcomes prior to the player getting on the river 4 9s... Although...
Nice post WhyDrawdown, I can see your point of view. ..... I particularly liked "our judgement gets so clouded by our bias".....you have it in a nutshell. I must admit those Martingales are addictive and at least there are ways to employ them without merely blind application that avoids risking the house.....yet I am still suss about their efficiency even then.......but maybe that's my 'bias' talking.
  • #178
  • Sep 22, 2015 7:23am Sep 22, 2015 7:23am
thanks for comments about brokers..


Guys, do you think if it's possible to apply both martingale and reverse martingale in same strategy?
.
.
  • #179
  • Sep 22, 2015 7:59am Sep 22, 2015 7:59am
Quoting She1
thanks for comments about brokers.. Guys, do you think if it's possible to apply both martingale and reverse martingale in same strategy? . .
please explain reverse martingale with example. still unsure on this term.
LUCKY golden trades, LUCKY gold investor trading style
  • #180
  • Sep 22, 2015 8:11am Sep 22, 2015 8:11am
I love martingale, and even averaging down/into position strategies.

they work, and they work, and they work , and you make a ton of money. and just as you start thinking of retirement plans in exotic destinations...

... margin calls!

I think,. No, I strongly believe martingale is all about timing. before you start- make a goal
- and promise yourself, once met, you'll stop and withdraw all profits, that is a gift from God and nothing more. yes, the Devil will tempt you. such greed is intoxicating.
Start again by all means, what ever keeps your mind satisfied- but put those birds in your hand, and be grateful.

dose Forex trading have to be akin to gambling? I don't necessarily believe so anymore but martingale will always be gambling.
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