How to calculate win/loss %?

[paszkman]

Hi everyone, just wanted to get some help on how to calculate a win/loss ratio win using multiple lots/multiple profit targets..

For money management if I set 3 profit targets in this way:
1. Take off 50% at +1R
2. Take off 25% at +3R - and now move SL of remaining 25% to entry.
3. Take off final 25% at +5R

So possible outcomes from one trade could be: -1R, 0R, +1.25R or +2.5R

Of 26 trades, my results are:
-1 = 7 times (27%)
0 = 10 times (38%)
1.25 = 3 times (12%)
2.5 = 6 times (23%)

So what is my win/loss ratio? 35%?

 

[alexaherself]

So possible outcomes from one trade could be: -1R, 0R, +1.25R or +2.5R

Of 26 trades, my results are:
-1 = 7 times (27%)
0 = 10 times (38%)
1.25 = 3 times (12%)
2.5 = 6 times (23%)

So what is my win/loss ratio? 35%?

Your win/loss ratio is 1.29 (that's just 9/7, because you've had 9 winning trades and 7 losing trades).

Your profit factor is a rather impressive 2.68: that's the total of your wins divided by the total of your losses: [(3 x 1.25) + (6 x 2.5)]/7

And the average size of your wins is 2.083 times the average size of your losses.

And your net expectation per trade is +0.45R (that's total wins minus total losses, divided by the number of trades made: unlike the results above, your 10 breakeven trades are reflected/included in this calculation).

 

[paszkman]

Your win/loss ratio is 1.29 (that's just 9/7, because you've had 9 winning trades and 7 losing trades).

Your profit factor is a rather impressive 2.68: that's the total of your wins divided by the total of your losses: [(3 x 1.25) + (6 x 2.5)]/7

And the average size of your wins is 2.083 times the average size of your losses.

And your net expectation per trade is +0.45R (that's total wins minus total losses, divided by the number of trades made: unlike the results above, your 10 breakeven trades are reflected/included in this calculation).

Thanks alexa...got any recommended reading where I could learn more about this?

 

[alexaherself]

Thanks alexa...got any recommended reading where I could learn more about this?

Trade Your Way to Financial Freedom by Van K. Tharp (covers the subject in as much detail as you'll want, without being oppressively statistical to digest!).

 

[paszkman]

Trade Your Way to Financial Freedom by Van K. Tharp (covers the subject in as much detail as you'll want, without being oppressively statistical to digest!).

thanks - very much appreciated!

 

[NVP]

Your win/loss ratio is 1.29 (that's just 9/7, because you've had 9 winning trades and 7 losing trades).

Your profit factor is a rather impressive 2.68: that's the total of your wins divided by the total of your losses: [(3 x 1.25) + (6 x 2.5)]/7

And the average size of your wins is 2.083 times the average size of your losses.

And your net expectation per trade is +0.45R (that's total wins minus total losses, divided by the number of trades made: unlike the results above, your 10 breakeven trades are reflected/included in this calculation).

What happened to the break evens. You can't ignore them as they are part of sample size ?

N

 

[NVP]

Hi everyone, just wanted to get some help on how to calculate a win/loss ratio win using multiple lots/multiple profit targets..

For money management if I set 3 profit targets in this way:
1. Take off 50% at +1R
2. Take off 25% at +3R - and now move SL of remaining 25% to entry.
3. Take off final 25% at +5R

So possible outcomes from one trade could be: -1R, 0R, +1.25R or +2.5R

Of 26 trades, my results are:
-1 = 7 times (27%)
0 = 10 times (38%)
1.25 = 3 times (12%)
2.5 = 6 times (23%)

So what is my win/loss ratio? 35%?

So if the spread is in effect your losing trades of -1....you actually are not losing on any calls at all ???

That's ridiculously good dude ....we need you on forexperians live call thread ..

N

 

[barjon]

So if the spread is in effect your losing trades of -1....you actually are not losing on any calls at all ???

That's ridiculously good dude ....we need you on forexperians live call thread ..

N

Think that's 1R not 1 pip? So good but not ridiculously

 

[paszkman]

As Barjon said, 1R not 1 pip..

 

[NVP]

As Barjon said, 1R not 1 pip..

right.............sorry my medication hadn't cut in last night

 

[bansir]

As Barjon said, 1R not 1 pip..

Hi,
It's been a while since I read Tharpy but I believe he makes the point that by working with "R multiples" you can directly compare the performance of various systems. Sounds great.

I'm never sure though quite how to apply it as there is usually something in any system I try which doesn't quite fit.
For example, if your system includes two instruments each with a different R then which value do you take? The bigger one and treat the smaller one as a fraction or do you take the average of the two?

I better go and read the book again...

Best Regards,
Neil

 

[barjon]

bansir

you use both and work out each multiple separately.

 

[bansir]

bansir

you use both and work out each multiple separately.

Thanks Barjon,
Adjust position size so that you're risking just say, 1% of capital on each trade?
ie.
Share(a) price * no. of shares(a) = R = Share(b) price* no. of shares(b).
(Chapter 6 page 132.)

Or is there another path which leads to a more meaningful "R"?

Anyway, thanks again.
Thanks too to Paszkman for the interesting discussion.

Best Regards,
bansir

 

[paszkman]

I dug up this old thread which has some really interesting discussion that is related to this topic:
http://www.trade2win.com/boards/dis...tecarlosimulation-trading-moneymangement.html