Averaging Down for the win?

[artist]

There is no "hedge". The exchange has the worst tech of any large exchange in the world. When you get these really fast sweeps an order can take 5 - 10 seconds to get to market. By that time the damage was done. There was no volume to trade into as some smart ar$e hits it with a 1000 lot and instantly its 100 points lower.

Thanks for the explanation.

 

[boofis]

Though I have no idea how you would do that without a large backing.....

This!! Yesty was a prime example, alot of the trades I took my entries were slightly off either too soon and got pushed out or too late and got the shake out and I had to close them cause I can't afford the extra risk let alone adding to that risk by doubling down and yet if I had've been able to the trades would've yielded the target of ~100 ticks.
One day I do hope to be able to do it though!

 

[havaiana]

Here is a little live account I've been using to do a bit of a stress testing for the last 3 weeks. My other trading has been my main focus so haven't had that much time to spend on this. Usually after asia is finished I jump on it for a bit so I can test some stuff through some more extreme volatility than is typical of asia and find it a good way to blow off some steam. I'm usually just trying to get into a position rather than worry too much about decent entries.

On your real account you obviously wouldn't be wanting to experience these type of drawdowns. I fully expected this account to go bust and it definitely would if I kept doing it this way long term. the account has reached a point now that am not comfortable letting it go bust because I am poor, so will trade it more sensibly.

But you can see if position sizes were reduced and a daily stop implemented how it can create quite a nice equity curve.

Note that when the daily stop is implemented some of them down movements would stay down and not bounce straight back up so fast, but still...

 

[CanOz]

You seem like you obviously have some talent Hav, why not keep plugging away at this live account and take your stats to Propex in hopes of getting funded?

I just realized we now have Cav, Pav, and Hav...

 

[havaiana]

Last update. Finished exactly 5 weeks on this averaging exercise today



That spot around trade 210 was a lot dodgier than it looks on the equity curve and led me to think about things and make some changes

Now I add a lot less (more linear, less martingale!) and add less times before i call it quits
I have shifted my time frame out a little. Instead of going for moves on a 1-5 minute chart I'm using the 1 min chart to go for moves on the 5-15 minute charts, this has also spaced out a lot where I will add which reduces the risk, helps me let the good trades run a bit longer and allows me to look for an opportunity to average up as well as down

This exercise has improved my trading a lot, made me just concentrate on coming up with an idea and contingency plan and then just concentrate on buying and selling in the right places. Previously I was just coming up with a half hearted idea, the stop was the contingency plan so the trading ideas didn't need to be as well thought out

My trading has changed a lot from the start of the exercise to the end, in terms of my stats in the future I imagine my win percentage will come down a fair bit, winning trade amount will increase and my profit to risk should increase. I will not consider increasing my position size until my daily stop comes down to 2%

In case anyone is wondering, no I wouldn't have posted my equity curve if I had blown up instead!