Obiously the main variable to control risk is lotsize and thus dollops... Anyway I think it is important to consider also TP and gridsize.
TP:
At first it seems that global risk/exposure is not dependant on TP. Smaller TP means frequent but smaller closures, higer TP means rarer but richer closures. Risk should remain the same ...
In reality, given how the EA is designed, higer TP means eventually more open trades so more exposure if things turn wrong. Think about the case where things fall just before you almost reached an ambitious TP....
Grid size/distances:
They directly influence the velocity to reach TP. The closer they are, the faster everything goes, the more exposure you have. If things go in the wrong direction, having a narrow grid can easily lead to lots of negative positions, because even smaller retracements would activate new trades and then bring them down again. With lighter grid this would be much more difficult.
To put it in perspective, taking the Hilavoku 500$ account case, it is true that if lotsize is the same, the “velocity” to reach a 30TP is the same for a 500 and a 5000 account. But it also true that to reach that TP, SPB would need to open the same number of multiple positions, thus actually its exposure would be 10 times higher. Unless he widens up the gridsize by a factor of 10... At that point risk would be the same, but everything would go slower... or reduce the TP at 3 to have same risk and velocity but less returns...
(then we obvioulsy dont desire/expect the same level of risk from a 500 and a 5000 account, it was just to elaborate with a concrete example)
So, starting from the assumption that that the logic behind SPB works and thus give us a basic edge (otherwise everything is useless), it will be crucial to find the optimum combination between these variables to maximize results and avoid wrong combinations that could even lead a pontentially winning EA into a losing one. Once again, coordinated tests are and will be gold. |
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