simcom
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I remember seeing a conversation along these lines as part of another thread a few days ago, however despite much searching I couldn't find it again so decided to start a new thread.
My question is this: What are peoples' views on trading a system that has an unfavourable risk:reward ratio (terrible - something to the tune of, for instance, 6:1)?
The system in question does have a positive expectancy, with historical results being 66% winning trades and the average winner being 0.9 times the average loser. As you can imagine, the largest percentage drawdown is big (32%), but is this necessarily a problem provided that appropriate money management is used? Or is this system too difficult to trade on a practical/psychological level?
Thanks for your views.
My question is this: What are peoples' views on trading a system that has an unfavourable risk:reward ratio (terrible - something to the tune of, for instance, 6:1)?
The system in question does have a positive expectancy, with historical results being 66% winning trades and the average winner being 0.9 times the average loser. As you can imagine, the largest percentage drawdown is big (32%), but is this necessarily a problem provided that appropriate money management is used? Or is this system too difficult to trade on a practical/psychological level?
Thanks for your views.