# Expected returns from a TA system



## Synergy (10 June 2007)

Just wondering what sort of returns i should be looking to achieve from a short term (say a 7 day hold avg) end of day based TA trading system.

What sort of returns are others getting? Is 50% PA a reasonable goal to set in current market conditions or should i be looking for higher?

I have a system that is starting to look promising, but I have nothing to compare to...


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## wayneL (10 June 2007)

Synergy said:


> Just wondering what sort of returns i should be looking to achieve from a short term (say a 7 day hold avg) end of day based TA trading system.
> 
> What sort of returns are others getting? Is 50% PA a reasonable goal to set in current market conditions or should i be looking for higher?
> 
> I have a system that is starting to look promising, but I have nothing to compare to...



Anywhere between -100% to +1000%


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## legs (10 June 2007)

wayneL said:


> Anywhere between -100% to +1000%




Gee thats a great response... accurate too.....


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## Synergy (10 June 2007)

fantastic! I'm within the expected range...

I know theres no answer but i'd like to get an idea of what other people are getting from their systems.

Cheers


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## tech/a (11 June 2007)

Waynes basically right.
But I'll see if I cant be a little more accurate.
So lets say we are not interested in those that make a loss.

Short term systems I have seen that produce profit,range from 
20% to 80% P/A

Long term generally fall in the 20-35% but have seen 45%.P/A.

Combine these returns with *COMPOUNDING OF PROFITS *into Capital 
*PYRAMIDING* into successful trades,and *LEVERAGE* and these figures relative to initial capital go through the roof.

With the system I have on the net Techtrader

http://www.thechartist.com.au/forum/ubbthreads.php?ubb=postlist&Board=53&page=1

Since inception 4.5 yrs ago the return on INITIAL Capital ($30,000) is around *1000%.*

So medioucre methodologies can return fabulous profit.Most attempt to design and trade a 1000% return method---*YOU DONT HAVE TOO.*

When return over 4.5 yrs could be 26% or 1000% you should quickly see that the REAL profits arent in the System OR the Analysis/Methodology used.

So where do most spend their efforts---YOU GUESSED IT at the 26% end!!


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## Nick Radge (11 June 2007)

I posted a real time record for an EOD system that holds a day here:


https://www.aussiestockforums.com/forums/showthread.php?p=167822&posted=1#post167822


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## Arturius (14 June 2007)

You haven't told us anything about the kind of drawdowns you'll be prepared to take, nor the kind of risk per trade, or anything. This is absolutely critical when designed a system.


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## tech/a (14 June 2007)

*Arturius*

I guess this is directed at Nick.
I'm sure he has the figures.
As I mentioned my published method above as well all is disclosed on the site.

I certainly agree with you.

With mine from memory
Initial drawdown was around 12%
Maximum Peak To Valley drawdown over the test period 22% ish.
Over the 4.5 yrs of trading all has performed within these boundaries.
Montecarlo analysis will of course give you a broad spectrum of expected D/D over as many portfolios you wish to test.
I used 50,000 for my design parameter.

Risk is 1% of total capital.
Maximum string of losses can also have a bearing.
From memory again I think mine was 12---in realtime trading I think the max string has been 5 or 6

R/Ratrio is also important.
Being a longterm method (techtrader) I look for 25-35% success rate and the R/R is around 8-12:1 (from Montecarlo results).
Shorter term methods are generally more successful with win rate but less R/R.


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## Arturius (14 June 2007)

Actually directed at the OP, heh. Novices think in terms of % gain only. Experts think about the spectrum; timeframes, drawdowns, capital risk, market change risk, diversification strategy.


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## Kauri (14 June 2007)

Arturius said:


> Actually directed at the *OP*, heh. *Novices* think in terms of % gain only. Experts think about the spectrum; timeframes, drawdowns, capital risk, market change risk, diversification strategy.




  :bonk:     OOOPs...I don't think you could consider Nick a novice... don't judge a book by its cover... unless it's Adaptive Analysis of course...


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## tech/a (14 June 2007)

http://www.thechartist.com.au/forum/ubbthreads.php

So this is what a "novice" website looks like!

Blooper 101---Arturius
Blooper 102---Expert??

Perception is everything (Robbed from another member!).


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## professor_frink (14 June 2007)

tech, kauri,

I'm pretty sure OP refers to original poster(or something like that), meaning Synergy, not Nick.


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## tech/a (14 June 2007)

Ahh

apologies.


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## nizar (14 June 2007)

tech/a said:


> Being a longterm method (techtrader) I look for 25-35% success rate and the R/R is around 8-12:1 (from Montecarlo results).
> Shorter term methods are generally more successful with win rate but less R/R.




R/R of 8-12:1 ??
Tech your a MACHINE.

Congrats on reaching this elite level.

Its unheard of for me. Iv seen nothing even close.

Your "the man"


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## professor_frink (14 June 2007)

nizar said:


> R/R of 8-12:1 ??
> Tech your a MACHINE.
> 
> Congrats on reaching this elite level.
> ...




Get off your knees Nizar, your embarrassing yourself.


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## tech/a (14 June 2007)

Agree Prof.

*Nizar.*
The point is that if this builder can do it---then anyone can do the same.
You dont have to be a Radge with 15 yrs industry experience.

Just the same passion you have.


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## It's Snake Pliskin (14 June 2007)

professor_frink said:


> Get off your knees Nizar, your embarrassing yourself.




I agree. Some sausage sucking going on.

..and your is you're.


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## It's Snake Pliskin (14 June 2007)

tech/a said:


> Agree Prof.
> 
> *Nizar.*
> The point is that if this builder can do it---then anyone can do the same.
> ...




Acually I hold the belief that 1 year with the right attitude, direction, help and specific texts, one can be profitable and move on to the professional aspect of trading.


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## nizar (14 June 2007)

Prof, Snake.
I give credit where credit is due 

And Snake -- as always, thanks for your constructive "wisdom"


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## Synergy (15 June 2007)

Arturius said:


> You haven't told us anything about the kind of drawdowns you'll be prepared to take, nor the kind of risk per trade, or anything. This is absolutely critical when designed a system.




Admittedly I'm a novice and I don't really have much much of an idea about TA. In short i've played around with some past data in excel and developped a system that looks ok. Havn't traded it yet, but I at least feel comfortable having a go with it.

As for risk, i'm planning on trading with 10% of total capital/trade and have an initial stop at a 10% loss. so 1%/trade. 

The system picks enough trades to be trading with 100% of capital 100% of the time. win/loss is around 50/50. avg hold time is 7 days and avg gain looks to be around 3% per trade. But on a big down note, I only have around 2.5 years test data, so i'm worried about that.

Knowing not very much about this, i'm pretty happy with what i have on paper, but didn't have anything to compare to.

Any help most welcome


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## happytrader (15 June 2007)

Synergy said:


> Admittedly I'm a novice and I don't really have much much of an idea about TA. In short i've played around with some past data in excel and developped a system that looks ok. Havn't traded it yet, but I at least feel comfortable having a go with it.
> 
> As for risk, i'm planning on trading with 10% of total capital/trade and have an initial stop at a 10% loss. so 1%/trade.
> 
> ...




Hi Synergy

Well done on gathering and testing 2.5 years of data for your short term system. While paper trading in real time is going to give you some idea of the systems performance, only live trading will reveal your own. This being the case, I suggest you don't trade 100% capital 100% of the time. The nature of short term trading is such that maintaining your self control and focus on decision making is your number one priority. So fight one battle at a time.

Cheers
Happytrader


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