Pipsology

Hi guys,

Would you say that the size of your pips does not matter ?

I was thinking about it recently that people who flashes the amount of pips they achieved were just to flatter their ego.

Why ?

The quantity of pips only determines the time frame of your strategy. It is your overall income/profit that defines how successful you are right ?

How ?

Take a look:

A risk and reward of 1:4.

A person who seeks large amount of pips are usually forced to be in a position for pretty long. They are essentially risking 100p to get a reward of 400p...

On the other hand, a person who seeks a smaller amount of pips usually catches pips really quickly say 40p risking 10p per trade...

But


They can both be equally successful in trading depending on their preferred lots. A larger lots on a smaller scale trade can give you the same amount of profit to somebody who’s trading larger scale with smaller lots.

So don’t get drifted away by people who shows off their pips.... because a trade with 10 pips can get you the same profit/result as a trade that gained 100 pips.

Comment below on your usual target pips and the time frame you use to capture it.

Happy trading.

Gerry.Rex said:

yes, i agree with you. We always have our own risk on every trade. For me, i'm using 1:1 risk and reward.

Click to expand...

Would you like to share the strategy you use ? and is it profitable ?

you are right, khongo,

the meaningful measure should be reward as a function of risk.
and the probable rate of wins.
this allows us to apply some means of quantifying the utility of a strategy.

for example for Gerry.Rex, a 1:1 reward:risk needs a 50:50 win ratio just to break even.
everything over that, results in a nett positieve outcome.
(notwithstnding spreads, fees, black swans, etc)

so, you're right, ignore the bravado, just look at the numbers.

Would you like to share your strategy too ?

Your perception of the market.

khongminhtn said:

Hi guys,

Would you say that the size of your pips does not matter ?

I was thinking about it recently that people who flashes the amount of pips they achieved were just to flatter their ego.

Why ?

The quantity of pips only determines the time frame of your strategy. It is your overall income/profit that defines how successful you are right ?

How ?

Take a look:

A risk and reward of 1:4.

A person who seeks large amount of pips are usually forced to be in a position for pretty long. They are essentially risking 100p to get a reward of 400p...

On the other hand, a person who seeks a smaller amount of pips usually catches pips really quickly say 40p risking 10p per trade...

But


They can both be equally successful in trading depending on their preferred lots. A larger lots on a smaller scale trade can give you the same amount of profit to somebody who’s trading larger scale with smaller lots.

So don’t get drifted away by people who shows off their pips.... because a trade with 10 pips can get you the same profit/result as a trade that gained 100 pips.

Comment below on your usual target pips and the time frame you use to capture it.

Happy trading.

Click to expand...

You won't be able to buy bread with pips. Trading performance is all about money that's it. Don't see the point discussing success through pips if for example the lot size was 0.01

From my point of view this comes down to the individual trader's context.

Of course, if one compares like to like then it's fairly easy to see who's doing what and how well but in T2W world and other forumses you've got an environment where there are some serious full-time professionals right through to guys trading nano accounts to pass the time of day. I don't see it particularly helpful to anybody to be showing off the enormous size of their oranges to someone else's more modestly proportioned apples.

If you want a true and accurate comparison then the inputs have to be normalised which, imho, is not going to happen on an open thread on this kind of forum. If you start a journal then of course, you can lay down the law but otherwise there doesn't seem much point in either stating your total pip gain or your monetary one either.

In my own case, I'm towards the bottom of the food chain and trade £1/L generally and also use a mouse account (mickey not minnie) for when I can't sit on my hands any longer. I try and get as good an RR ratio as I can starting at 1:1 but that varies wildly as things develop in real time and so any set figure only applies to my Set and Regret trades. I only post my per lot pip gain which I'll still express as an average if I've used my usual 3 or 4 lot position approach....and for the record my long-time absolute ceiling is an overall £10 p/p so I'm definitely with the minnows. For me I don't see it useful to say/read "I made £50/ £500/£5000 today/this week" unless I have all the other information as well. Trade duration, risk/reward ratio, lot value etc etc.

It is my experience that guys on different threads use different criteria and if you really want to know who is doing what, exactly, and they haven't already stated it then it's probably a pm job. Personally speaking , I'm not a professional trader and my miserable pip count only means something to people at my level of activity and sod all to anyone else.

ATB

trading key indicator is % return on capital invested by a rolling number of trades ...say 100 ...i would suggest retaining a fixed value for the capital to avoid distortions

so it’s ROCE .....just like any business ?

pips become irrelevant using this measure and it allows fair benchmarking between all traders if needed

N

NVP said:

trading key indicator is % return on capital invested by a rolling number of trades ...say 100 ...i would suggest retaining a fixed value for the capital to avoid distortions

so it’s ROCE .....just like any business ?

pips become irrelevant using this measure and it allows fair benchmarking between all traders if needed

N

Click to expand...

Well yeah for capital-intensive industries ROCE is a perfect measure of effectiveness. For trading where money is the only "production factor" should perfectly fit the bill.

khongminhtn said:

Would you like to share the strategy you use ? and is it profitable ?

Click to expand...

I would also like to know about that strategy

hatemypips said:

You won't be able to buy bread with pips. Trading performance is all about money that's it. Don't see the point discussing success through pips if for example the lot size was 0.01

Click to expand...

I agree on that.

LouisaM said:

I would also like to know about that strategy

Click to expand...

the success of any strategies depends on money management , without that there is no way to bring profit consistently. so we have to focus on there first of all.

Money management is very necessary to be successful in forex. Without it, it is difficult to main your success ratio in forex.

One of my biggest bug bears. Pip count isn't a flex without the context of risk reward.

khongminhtn said:

Hi guys,

Would you say that the size of your pips does not matter ?

I was thinking about it recently that people who flashes the amount of pips they achieved were just to flatter their ego.

Why ?

The quantity of pips only determines the time frame of your strategy. It is your overall income/profit that defines how successful you are right ?

How ?

Take a look:

A risk and reward of 1:4.

A person who seeks large amount of pips are usually forced to be in a position for pretty long. They are essentially risking 100p to get a reward of 400p...

On the other hand, a person who seeks a smaller amount of pips usually catches pips really quickly say 40p risking 10p per trade...

But


They can both be equally successful in trading depending on their preferred lots. A larger lots on a smaller scale trade can give you the same amount of profit to somebody who’s trading larger scale with smaller lots.

So don’t get drifted away by people who shows off their pips.... because a trade with 10 pips can get you the same profit/result as a trade that gained 100 pips.

Comment below on your usual target pips and the time frame you use to capture it.

Happy trading.

Click to expand...

FX is quite liquid so if I person can boast with stable pip gains, it's not a problem to convert it in money gains of the size you want.