Mathematical trading

[t.roland]

Hello,


I have a trading method that in 16 years of backtests has only 2 lost trades from a total of 53.
The trades are based on mathematics and the pattern which generates them is rare, but the trades are reliable and guaranteed.

This is the safest method I have and I only trade this one.

I will post here my last such trade and my future trades.

Feel free to test my trades.

 

[t.roland]

I have created a purely mathematical trading method with a extremely low chance of failure, I invite you to test the next trade I post.

It's not based on technical or fundamental analysis, it's purely mathematical and I have sacrificed a high number of trades per year in favor of a stable method that can allow me to not sit pointlessly in front of my computer the whole day.

 

[t.roland]

This is the second account, in which I will take a risk slightly higher than in the first, it being a smaller account as well.

I will post the trades and results here.

 

[t.roland]

back test results with 5%/trade - 16 years period

The 7% backtest has a total netprofit of 1,314,800 $ and a drawdown of 47,67%.

 

[tomorton]

A trade every 3 months takes real discipline. But surely also either a massive starting account or huge % risk per trade?

 

[t.roland]

A trade every 3 months takes real discipline. But surely also either a massive starting account or huge % risk per trade?

At the moment I have two accounts , one of 100k which has become 112k after the first trade, and one of 43k which is at 51k and in which I am taking a slightly higher risk than in the first. It has the same % of profit as the 100k one and it's only 40k.

The low number of trades does not bother me because I wanted something with a focus on stability in the first place and which can offer a sure profit from year-to-year, not monthly (like people are looking for).

I sacrificed the number of trades for stability and a high percent of winning trades.

I know what I've created and I'm convinced that it can generate a lot of profit, which is almost guaranteed if we consider the backtests and the first live trade taken.

I invite you to test the next trade which I will post, on your account or on a demo account.
I will post the trade in this thread when the mathematical pattern will be identified, with a clear image of it and the risk/money management which I'll be using.

 

[timsk]

. . .I invite you to test the next trade which I will post, on your account or on a demo account.
I will post the trade in this thread when the mathematical pattern will be identified, with a clear image of it and the risk/money management which I'll be using.

Hi t.roland,
Welcome to T2W.

You seem pretty confident that you have a methodology that will generate consistent profit, so I'm wondering what's your motivation to post here and get members to follow you?
Tim.

 

[t.roland]

Hello timsk,

Thank you.

My motivation is to provide people with trades that really work and to show that the old technical and fundamental analysis methods are deemed to fail. The few that make profit in this market, use mathematics. Technical and fundamnental analysis, which are based on the psychology of people and the market participants, do not work properly because psychology is constantly changing, but mathematics was the same 30 years ago and it will be the same in the future too. Some things do not change. The method and its trades are not for sale, since I will be posting the trades here, for free. I have accounts worth 150k USD total, I do not need money from such activities. In conclusion, my motivation as a mathematician and statistician is rather a scientific one, to prove and show that mathematics in trading is net superiour to any other type of analysis. Mathematics does not lie.

 

[counter_violent]

Correct me if I'm wrong.
Would it be fair to say that all trades have been on EURUSD?
If so and it is a mathematical method of trading, have you tested it on other instruments and does it produce similar results?

 

[EnlightenedJoe]

If you claim that mathematics can predict the behaviour of banks who operate the financial markets then the mathematics must be lying. The banks are run by people. So precisely what they will do is unknowable. There are no known branches of mathematics that can predict human behaviour with any amount of certainty.

What you have got yourself into there is a typical beginner's trap. You curved fitted the past data and believe it has predictive capabilities. All beginners start that way.

Markets exist for the profit of their operators. That means the market rarely go to places where their operators make a loss. Sometimes they do, but these are very rare exceptions. The rationale is very simple: what idiot would put in all the money and effort to run a market only to make a loss ? Banks have tall shiny buildings precisely because they are very profitable.

It's understandable you are feeling euphoric that the mathematics have made you a profitable first trade. But if you are blinded by that, you are going to say bye bye to your 150k pretty soon.

Mathematics is particularly bad for predicting the markets precisely because it doesn't change. Markets are operated by people motivated by profit. There is no reason why their behaviour should be magically controlled by your mechanical mathematics. If a profit can be made by not behaving mechanically, that is exactly what they will do. People will do anything to turn a profit, including defeating mathematics.

Mathematics is better suited to predict the roulette ball because it is mechanical and has no motivations. I reckon you will do better at the casino if your mathematics is really that good. Even casinos are run by people. So your mathematics will lose against the ball tampering. See, the human motivation is super natural in essence ?

 

[Lord Flasheart]

The 7% backtest has a total netprofit of 1,314,800 $ and a drawdown of 47,67%.

How can we trade with a dd of 47%. With leverage we are wiped out,or am I missing something?

 

[t.roland]

Correct me if I'm wrong.
Would it be fair to say that all trades have been on EURUSD?
If so and it is a mathematical method of trading, have you tested it on other instruments and does it produce similar results?

On other pairs the results are not acceptable, this is a mathematical pattern that is very effective only on EUR/USD.

 

[t.roland]

If you claim that mathematics can predict the behaviour of banks who operate the financial markets then the mathematics must be lying. The banks are run by people. So precisely what they will do is unknowable. There are no known branches of mathematics that can predict human behaviour with any amount of certainty.

What you have got yourself into there is a typical beginner's trap. You curved fitted the past data and believe it has predictive capabilities. All beginners start that way.

Markets exist for the profit of their operators. That means the market rarely go to places where their operators make a loss. Sometimes they do, but these are very rare exceptions. The rationale is very simple: what idiot would put in all the money and effort to run a market only to make a loss ? Banks have tall shiny buildings precisely because they are very profitable.

It's understandable you are feeling euphoric that the mathematics have made you a profitable first trade. But if you are blinded by that, you are going to say bye bye to your 150k pretty soon.

Mathematics is particularly bad for predicting the markets precisely because it doesn't change. Markets are operated by people motivated by profit. There is no reason why their behaviour should be magically controlled by your mechanical mathematics. If a profit can be made by not behaving mechanically, that is exactly what they will do. People will do anything to turn a profit, including defeating mathematics.

Mathematics is better suited to predict the roulette ball because it is mechanical and has no motivations. I reckon you will do better at the casino if your mathematics is really that good. Even casinos are run by people. So your mathematics will lose against the ball tampering. See, the human motivation is super natural in essence ?

When all investment firms are looking for mathematicians and people specialised in probabilities and statistics, you're saying that mathematics is zero.
It's not even worth the effort to reply to such a comment, because it would be a waste of time.
You should document yourself about how real trading is done.

 

[t.roland]

The 7% backtest has a total netprofit of 1,314,800 $ and a drawdown of 47,67%.

How can we trade with a dd of 47%. With leverage we are wiped out,or am I missing something?

The leverage is 1:100, I don't use more. And i'm not wiped out at 47% , I'm wiped out only at 100%.

 

[EnlightenedJoe]

There's no profitable retail trader, that's something I am convinced of. Technical analysis doesn't work, fundamental analysis doesn't work, let's not even begin to mention candlestick signals which are just fairy tales. All institutional traders use mathematics. If you say that mathematics is not suitable for the market, you don't know what you are talking about, and I invite you to ask around which people work in the big investment firms? People with a degree in mathematics, probabilities and statistics or a trader who draws support and resistance lines?

The results that are already present in live trading confirm the backtests. Since I will be posting the future trades here, you can feel free to follow them and I invite you to test them and afterwards we can compare who has the most profit at the end of the year. Mathematics or the technical and fundamental stories.

I bet you don't make profit, because usually the people with all kinds of super theories about the market psychology are left at the level of people who just talk online.

Which institutional traders are you talking about ? The banks operate the sell side business. They rent their wares for you to speculate on. The hedge funds operate on the buy side as you do. I presume you are talking about them using mathematics ? For most hedge funds, their results are nothing spectacular. I don't reckon it makes any difference what they use. They will get played by the banks as you would be.

 

[t.roland]

Which institutional traders are you talking about ? The banks operate the sell side business. They rent their wares for you to speculate on. The hedge funds operate on the buy side as you do. I presume you are talking about them using mathematics ? For most hedge funds, their results are nothing spectacular. I don't reckon it makes any difference what they use. They will get played by the banks as you would be.

I repeat. I invite you to test the trading method on a demo account this year. And next year, if you want, you can put the trades on real. I will post here all the trades I'm taking, in real time, even if there's only a few of them per year.

 

[barjon]

"..........You should document yourself about how real trading is done.........

If you want to see what "real trading" is about then have a look at this http://www.trade2win.com/articles/752-day-life-forex-spot-desk-trader-part-1-a and the part 2 follow up.

Be interested to learn how you model that mathematically

 

[EnlightenedJoe]

I repeat. I invite you to test the trading method on a demo account this year. And next year, if you want, you can put the trades on real. I will post here all the trades I'm taking, in real time, even if there's only a few of them per year.

Oh, ok, thanks. I don't do demo because the markets don't scare me. I find these banks are somewhat predictable, their greed is their weakness. If you call out a good trade, I will buy in for sure. But a 47% draw down is too high. I will do 1/100 normal size then. I will add more once it turns.

 

[t.roland]

If you want to see what "real trading" is about then have a look at this http://www.trade2win.com/articles/752-day-life-forex-spot-desk-trader-part-1-a and the part 2 follow up.

Be interest to learn how you model that mathematically

I had that life for about 10 years and I don't want it anymore. I wanted a system that is stable and can offer more time for myself, so I can go fishing and spend it with my family.

That's what I created, since I have a background in trading and mathematics. A stable system with a few trades per year which can bring me profit without me sitting in front of my PC and desk waiting pointlessly.

For example, on my last trade, on the 100k account I made 13k profit and on the 44k one I made 6k.
It's more than enough, I calmly wait the next trade, while still having a lot of free time for myself and my family.

The EA is functional 24/7, it does the trading for me.

 

[t.roland]

Oh, ok, thanks. I don't do demo because the markets don't scare me. I find these banks are somewhat predictable, their greed is their weakness. If you call out a good trade, I will buy in for sure. But a 47% draw down is too high. I will do 1/100 normal size then. I will add more once it turns.

I agree that 47% might be too stressing, though if you use a 5% per trade as risk, it's a acceptable risk and the winning trades are pretty big, so that they're covering the deficit in the number of trades. I sacrificed the number of trades for stability.

As soon as I'll have a new pattern I will put the image with the trade taken on each of my two accounts.