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| Grid strategy + multiple markets traded as one = lower risk? https://www.stevehopwoodforex.com/phpBB3/viewtopic.php?t=4847 |
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| Author: | jono [ Tue Aug 02, 2016 2:28 am ] |
| Post subject: | Grid strategy + multiple markets traded as one = lower risk? |
Hi all, Looking for your thoughts and advice on a trading strategy Idea I have. And if its even possible to put it into an EA or software. I'm new to trading and I have only been using a demo account just to get a taste. IDEA Create an EA/software that does the below: Monitors multiple Market at the same time E.g. forex stocks etc… Then trades the top X trending and/or ranging markets: - Trades the trending grid strategy for the trending markets - Trades the ranging grid strategy for the ranging markets Treats all trades/markets as one by having a global profit/loss. Closes all order across markets when in profit by X%, and starts all over again. EXAMPLE Out of 1,000 markets scanned it picks the to top 10 trending/ranging markets. Say 5 trending and 5 ranging. It then places trades in the 10 markets and the grid trading system takes over. Because the grid system is marginal there is a maximum % stop loss for each individual market. It increases the Lot size upon a loss across all trades (not just the one market/trade) plus 10%. Say it loses a trade and need to increase the lot by 1.0 so the next 10 trades will increase by 0.11 (0.11*10 trades = 1.1 total which is 1.0 lot plus 10%) the extra % can be 0%,20% etc… anything you want. Its just there to counter the expected losing trades. So if your average win rate is say 70% then maybe 30% extra increase in lot size would be good for you i.e means than you’ll profit if 70% or 7 out of 10 trades win. When the global profit is greater than than say 1% of total investment it closes all trades and then repeats the whole thing again. NOTES Based on my back tests, the grid strategy loses seems rare. I’ve back tested 10 years on some markets without a loss, but when it does lose (and it will on some markets) it will blow your account. So in the real world you can expect to mostly win on a daily basis. Buy adding a global profit/lose and increasing lots size across multiple markets/trades (instead of just 1 trade) what I’m saying is, what if say 3 out of 10 loses all the time (not every 1,5,10 etc.. months/years) it will not matter because the profits from the other 7 should be more than counter the losses. And more importantly if you have an unusually long losing streak in 1 market it would not wipe out your account. To get a global loss across all trades you would need to lose 4-10 trades all at the same time multiple time in a row which is possible but in my view very unlikely. Normal Grid strategy: 1 market loses too many times in a row = wiped out This multi market gird strategy Idea: say 3 markets loses multiple times in a row but the other 7 markets win = overall profit due the increase lot size in all trades. Conclusion I very much like the trending and ranging grid trading strategy because you can profit in both market conditions and all you really need to do is decide if the market is trending or ranging. Even when you’re wrong you can still win as it’s a marginal system hence the high win rate. Combine this with the idea of spreading the increase lot size across multiple markets (instead of just one) and maybe it might lower the risk of blowing your account or at least not have to worry about a long losing streak in 1 market. Also with the grid trading strategy you are always profiting from the constant market movements all the time. QUESTIONS 1.) What Do you think? 2.) Do you think that the strategy explained above (IDEA & EXAMPLE) lowers the risk of this very risky marginal strategy? 3.) Do you think It’s possible to create an EA/software that does this? 4.) I’m a noobie, does my idea even make sense, is this silly to a season trader? I’d be interested to know what your thoughts or comments are on this trading idea. Be as harsh as you want, if you think it’s good, bad, idiotic then say so. |
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| Author: | Finserv [ Sat Sep 17, 2016 4:43 pm ] |
| Post subject: | Grid strategy + multiple markets traded as one = lower risk? |
I am trading with a grid EA at the moment. You get variable versions of the grid EA. I made 480% in two months just to wipe my account in two weeks. The thing with a grid EA according to my knowledge is, that everything depends on the risk you take. As soon as you go high profit you get high risk. The grid EA I use should not be traded in News for that pair. The other thing is that the grid size on all currencies is different. One currency moves 130 pips per day, where another moves 50. I believe it is best to trade with the EA as it might need some human intervention. The Grid EA also helped my trading a lot as it taught me support and resistance levels. |
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| Author: | tomele [ Sat Sep 17, 2016 6:42 pm ] |
| Post subject: | Grid strategy + multiple markets traded as one = lower risk? |
Oh my god, two buzzwords in one post. Martingale and Craptesting. How about looking around a little bit here before posting? |
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| Author: | milanese [ Sat Sep 17, 2016 6:46 pm ] |
| Post subject: | Grid strategy + multiple markets traded as one = lower risk? |
that is why I locked this irritating topic, the OP should before posting again study all the usefull stuff we have here.. Cheers  Tommaso |
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