In response to underperformance, I have made decisive changes to the Expert Advisors (EAs) managing my DARWINs GBN and BRX. Specifically, I have discontinued the use of previous EAs due to their unsatisfactory performance metrics.
Subsequently, I have deployed new Expert Advisors on these accounts: 4 instances on GBN and 3 on BRX. Each instance is programmed to trade a distinct set of high-growth stocks, targeting companies known for their robust growth potential such as Dick's Sporting Goods (DKS), Microsoft Corporation (MSFT), and Deckers Outdoor Corporation (DECK), among others.
The revised strategy marks a shift towards a more dynamic approach, encompassing both buying and selling activities to capitalize on market movements. To mitigate risk and optimize returns, I have instituted fixed stop-loss and take-profit parameters. Initially, these parameters are set to a 1:1 risk-reward ratio. However, leveraging automated logic based on comprehensive data analysis, these parameters are adjustable to a 1:n ratio. This adjustment is not based on a trailing mechanism but is fixed and fine-tuned according to identified patterns and historical performance insights, enabling the implementation of varied take-profit targets.
The decision to focus on growth stocks is based on their historical tendency to outperform the market over the long term, which reflects their potential to deliver substantial returns. Leveraging this behavior, the strategy is designed to maximize gains from the upward trajectory of these stocks. Therefore, BUY deals are aimed at capturing profits, while SELL deals are intended to hedge against risks in the event of market reversals.
I employ portfolios comprising several growth stocks because it's impossible to predict when a company might falter and cease growing. This diversification strategy helps mitigate the risk associated with the potential underperformance of any single stock, ensuring a more stable and resilient trading approach.