51%

This is a discussion on 51% within the General Trading Chat forums, part of the Reception category; Originally Posted by Hotch I'd be quite impressed if he managed an 89% win rate in 1 trade. It's Mr ...

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Old Mar 30, 2011, 6:58pm   #31
 
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Re: 51%

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Originally Posted by Hotch View Post
I'd be quite impressed if he managed an 89% win rate in 1 trade.
It's Mr P's maths

(Luv ya really T_D! How's about giving me a tip for that gambling account, in enough time so I can trade it.... you pwomissed..... )
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Old Mar 30, 2011, 7:00pm   #32
 
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Re: 51%

shadowninja started this thread You want a gamble? Go long euro now, hold overnight, stop -100, target +100. Take partial at 1.4190 and stop to b/e.

Note: anyone who takes this trade without doing their own research is a pillock and deserves to lose 100 pips.
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Old Mar 30, 2011, 7:12pm   #33
 
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Re: 51%

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Originally Posted by arabianights View Post
My point is... you haven't said how many trades you've taken! If you've taken 1000 trades in that time with that record, it's stunning. If you've taken 1, not so much...
The actual number of trades in question is 45. (40 wins / 5 losses) and although I started out playing it with discretion, I now play it with none. It is totally systematic :-)

As a matter of interest: what is a statistically valid number of trades? I would have thought that over that time frame (November 2009 - March 2011) the number would be less than for, say, a scalper.
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Old Mar 30, 2011, 7:15pm   #34
 
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Re: 51%

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Originally Posted by shadowninja View Post
You want a gamble? Go long euro now, hold overnight, stop -100, target +100. Take partial at 1.4190 and stop to b/e.

Note: anyone who takes this trade without doing their own research is a pillock and deserves to lose 100 pips.
Just to mix it up a little bit, Shadow, would you say it is also a gamble to go short now with the same stop and target?
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Old Mar 30, 2011, 7:16pm   #35
 
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Re: 51%

shadowninja started this thread The time-frame is irrelevant. The number is all that matters. I would say 1000 trades is a good sample size. If I said 40 out of 45 people I asked thought Justin Beiber was the most talented singer ever, you'd tell me to ask another 955 people. And stop hanging outside girls' schools.
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Thanks! The following members like this post: trader_dante
Old Mar 30, 2011, 7:18pm   #36
 
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Re: 51%

shadowninja started this thread
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Originally Posted by trader_dante View Post
Just to mix it up a little bit, Shadow, would you say it is also a gamble to go short now with the same stop and target?
To answer that would hamper my recommendation!

But I see no reason technically to be short for that size of stop. You might, of course.
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Old Mar 30, 2011, 7:22pm   #37
 
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Re: 51%

I'm a newbie here on this forum, but I appreciate everyones thoughts and oppinions. Thank you in advance for any help, or suggerstions in the future.
Cheers
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Old Mar 30, 2011, 7:39pm   #38
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Re: 51%

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Originally Posted by trader_dante View Post
The actual number of trades in question is 45.
Thats less than the number of trades I take in a week and I constantly worry about my stats being based on an insufficient sample size !

How will you know when your methodology no longer works ? do you have a definate line in the sand that you wont cross ?
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Old Mar 30, 2011, 7:52pm   #39
 
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Re: 51%

If TD gives us the mean and Standard Deviation of his 45 trades, I think I can work out the likelihood of him achieving this by accident.

But don't quote me on that.
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Old Mar 30, 2011, 7:53pm   #40
 
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Re: 51%

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If TD gives us the mean and Standard Deviation of his 45 trades, I think I can work out the likelihood of him achieving this by accident.

But don't quote me on that.
.
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Old Mar 30, 2011, 7:54pm   #41
 
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Re: 51%

Anyway, having quoted you, no you can't unless he's been completely systemic which I substantially doubt.
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Old Mar 30, 2011, 7:56pm   #42
 
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Re: 51%

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Originally Posted by arabianights View Post
Anyway, having quoted you, no you can't unless he's been completely systemic which I substantially doubt.
I would be working on the premise he is a machine, and having met him I can confirm he is at least not human.
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Old Mar 30, 2011, 8:28pm   #43
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Re: 51%

>> That whole notion of having a system that's got a 51% chance of leaving you with profit (R:R 1:1)

I would presume, that having a 1:1 system, you would need to be more on par with a 60% strike rate to cover slippage, commissions and then enough to stay ahead of the game.

I use a 2:1 system. In Theory one would need a 33% strike rate to “break even”. I find over hundreds of trades that it hovers around 42%, enough to cover any slippage and commissions.

A few years back I used a 3:1, but found my strike rate to drop down to the 38% range. This meant statisically more losing trades and in reality it didn’t come out any better than 2:1. For me 2:1 suits me, but then everyone has their own thresholds that suits them.

>> I need a system that's much higher so that when I make mistakes or there's a power outage or I need the toilet or get a phone call

I found I was never really good a “discretionary” trading, and it caused more mental pain than it’s worth. I fell into systematic trading, of having a clear set of rules which had to be adherred to with no exceptions. Now when when trade you are more a robot to your rules, but as an emotional human executing them, I found I would bend the rules :-) Which leads to technology. If your rules are clear and can be written down, they most likely can be turned into computer code which can then execute the trades for you. I turned my systems into computer code which now execute my rules and thus now there is no need to “watch the market”. Also I can trade multiple systems over multiple financial instruments with ease. This leads you to having more time on your hands. If you do fun things outside the market and lead an active, fulfilled life, there is very little inclination to mess with it, but just let it do it’s thing.
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Old Mar 30, 2011, 8:28pm   #44
 
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Re: 51%

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Originally Posted by shadowninja View Post
The time-frame is irrelevant. The number is all that matters.
I'm not sure I agree with this.

I mean, I do in principle but time frame has to come into it!

For example, part of the criteria for a robust system is that it holds up under different market conditions.

So if you had 40 trades all taken on one day and 40 trades taken over 4 years, I would rather back the latter.

OK, it's still, perhaps, a statistically insignificant number but its at least been open to shifting market cycles. And I do think that gives it some weight.
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Old Mar 30, 2011, 8:35pm   #45
 
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Re: 51%

In a sense and for example, a day on a 1min trigger trigger is worth x days on say a 1hr or y months/years on a 1day trigger. If you take the dramatic 2.11.62 - 1.3505 fall in cable we see many such moves of this pro rata magnitude on the 1min chart.

G/L

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I'm not sure I agree with this.

I mean, I do in principle but time frame has to come into it!

For example, part of the criteria for a robust system is that it holds up under different market conditions.

So if you had 40 trades all taken on one day and 40 trades taken over 4 years, I would rather back the latter.

OK, it's still, perhaps, a statistically insignificant number but its at least been open to shifting market cycles. And I do think that gives it some weight.
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