If anyone is interested, I have written an article about the edge I have in my trading systems and how I measure it Measuring Your Trading Systems Edge
Basically, to measure the edge of an entry, I first decide what the entry is to be, Donchian Channel Breakout, SMA crossover etc, then I measure how many pips the price moves in favour and against the entry between the moment it is first entered and a fixed point in the future. The size of the favourable movement is divided by the size of the unfavourable movement and the result is the entry's 'Edge Ratio'.
An exit's edge is slightly more difficult to measure but I have done it as size of improvement over the time based exit.
So folks, if anyone wants to discuss it, what's your edge and how do you measure it?
My edge produced a system on the EUR/USD with a winning pips to losing pips ratio of 2.10 that was improved to 2.29 to 1 with the best exit. The details are in the article
Basically, to measure the edge of an entry, I first decide what the entry is to be, Donchian Channel Breakout, SMA crossover etc, then I measure how many pips the price moves in favour and against the entry between the moment it is first entered and a fixed point in the future. The size of the favourable movement is divided by the size of the unfavourable movement and the result is the entry's 'Edge Ratio'.
An exit's edge is slightly more difficult to measure but I have done it as size of improvement over the time based exit.
So folks, if anyone wants to discuss it, what's your edge and how do you measure it?
My edge produced a system on the EUR/USD with a winning pips to losing pips ratio of 2.10 that was improved to 2.29 to 1 with the best exit. The details are in the article
