What it takes to have it

[FXforfun]

Hi,
I'm not an investor, I tried it but after some months seeing my portfolio investment performance much poorer than my own Darwins I let it go. If I lose, I'll do it by my own merits

I've been trading for years. Never successful I admit. But what is the definition of successful? Well, that would be another post, I'm not successful by my own standards though I put my skin on my strategies.
But what does it take for a Darwin to have the key? When you say. That's really good. Not about searching the holy grial but just genuin Good.

I have a scientific mind and translate it on everything I do. That's why I'm a quant trader. I need measures, facts to classify what's good, bad or better. So here, as investors, what do you look at? The D-Score, drawdawns, Return, profit,...?

I read the website of a Darwin provider UYZ. I think that's one of the bests, and looks like a humble guy, which is better yet! I saw something I didn't thought before. It was something like; He's been trading for a living for 7 years, entering now on his 8th. He's not 100% sure yet to be consistent because you'll be able to really measure the trader after his 8 years track.
So, in other words: After this year he'll be able to feel confident enough to know that he has what it takes to trade.

And now, in my quant mind. How do you measure it? Just beeing green? Not good enough beeing green/flat. Having a track record of 8 years? Would be the same as to say that you can't measure it enough because after 8 years is evident if you have it or not. Some kind of statistical significance? Based on what; trades, months, both?

I guess there are as many answers as investors, same as on trading; as many systems as traders. The right answer probably with those who win money, on both sides of the equation - traders & investors.

 

[DominionCuentas]

Hi,
I'm not an investor, I tried it but after some months seeing my portfolio investment performance much poorer than my own Darwins I let it go. If I lose, I'll do it by my own merits

I've been trading for years. Never successful I admit. But what is the definition of successful? Well, that would be another post, I'm not successful by my own standards though I put my skin on my strategies.
But what does it take for a Darwin to have the key? When you say. That's really good. Not about searching the holy grial but just genuin Good.

I have a scientific mind and translate it on everything I do. That's why I'm a quant trader. I need measures, facts to classify what's good, bad or better. So here, as investors, what do you look at? The D-Score, drawdawns, Return, profit,...?

I read the website of a Darwin provider UYZ. I think that's one of the bests, and looks like a humble guy, which is better yet! I saw something I didn't thought before. It was something like; He's been trading for a living for 7 years, entering now on his 8th. He's not 100% sure yet to be consistent because you'll be able to really measure the trader after his 8 years track.
So, in other words: After this year he'll be able to feel confident enough to know that he has what it takes to trade.

And now, in my quant mind. How do you measure it? Just beeing green? Not good enough beeing green/flat. Having a track record of 8 years? Would be the same as to say that you can't measure it enough because after 8 years is evident if you have it or not. Some kind of statistical significance? Based on what; trades, months, both?

I guess there are as many answers as investors, same as on trading; as many systems as traders. The right answer probably with those who win money, on both sides of the equation - traders & investors.

 

[CavaliereVerde]

The numbers tell only part of the story.
Numbers are calculated from a trackrecord.
We dont' know the significance of that trackrecord, it could come from a farm of many accounts.
Performance and discipline are the past, you have to understand if those results are produced by a honest and educated person.
As trader you know what you are doing, generally you don't cheat yourself.
Investing is much more difficult than trading, you don't know the genuinity of what is presented to you.

 

[Pure Pip Producer]

The numbers tell only part of the story.
Numbers are calculated from a trackrecord.
We dont' know the significance of that trackrecord

So, do you agree with me after all? 🤔

"It is not the length of the track-record that matters but the process."

An extrapolation of that would be to say : It is better to have the right mindset knowing how to process information rather than a long track-record that includes disqualifying negative quarters.

I'm glad to hear that you're finally on the right way....

Because those who think in the other way are those who keep going to buy the top and sell the bottom, again and again...



Really, if now, we would ask you :

Do you prefer to have a 10 years track-record with disqualifying negative quarters but not the right process to treat the information to be able to not have disqualifying negative quarters anymore?

Or do you prefer to have the right process to treat the information to be able to never have a disqualifying negative quarter anymore but not a 10 years track-record yet?

I already know... no need to answer 😉

 

[Pure Pip Producer]

The answer is not in the datas of the market. The answer is in our brain.

 

[FXforfun]

I should disagree with you guys. It's all about numbers and metrics.
At the end of the day "the process" is validated or not by the numbers.
Of course if they cheat you and give you false numbers you're fucked. But if the raw data is genuine that's all you need. Never mind if before a trade you offer a blood sacrifice to Zeus or you have a robot trading for you.

 

[CavaliereVerde]

I tried it but after some months seeing my portfolio investment performance

How many darwins and how many months?

my own Darwins

Which are your darwins?

 

[FXforfun]

Which are your darwins?

Hey! Sorry, I'm having some busy days I didn't see your direct question. My Darwins are DFO and EPG.
They are strugling on these past 2 months but here we are

 

[CavaliereVerde]

Darwins are DFO and EPG.

Nice!
Promising stuff and decent skin in the game.
Do you want me to start a thread about one of them?
Which do you consider you flagship?

 

[FXforfun]

Thanks for your nice words @CavaliereVerde . Appreciated

Do you want me to start a thread about one of them?

My Darwins haven't earned yet the right of the star lights. I mean, if I was a potential investor I wouldn't bet on them.

Of course I strongly believe in my method and results will come, otherwise I'd be a moroon to have my own money put on them. But currently I don't have a solid track record... and once I have it words won't be too necessary

 

[CavaliereVerde]

So I will answer here to your question in the title.
Initially I thought it was a question as investor but it was as trader, so what it takes to have confidence in a strategy or what investors are looking for.
You are a quant so it is just like backtests.
Would you trust a backtest of one year? I wouldn't.
Live results are more significant but we have thousands of darwins or trackrecords, it is like an optimization run, you have to pick a robust parameter set not the luckiest.
The longer the trackrecord the better but I would say at least 2 years.

 

[CavaliereVerde]

@FXforfun
Promising and robust growth on your EPG
Congrats for one year of trackrecord! 🎂
->https://www.darwinex.com/darwin/EPG
If you want a darwin topic just tell me.

 

[IlIlIlIlI]

@FXforfun

Good luck!

 

[FXforfun]

Just for the sake of crunching numbers. What chances would have a Darwin to make us rich? Or to make money for a living? Or just to make money enough to barely continuing trading?...

Well, I decided to make a break on my robots and crazy Forex ideas, and dive into the Darwin Universe to check for myself how is everyone struggling with the markets

First, Darwinex sample has 3.105 Darwins. Good enough for my taste. Let's move forward and play with some filters.
Simple exercice: I filtered the Darwins according its longevity - More than 1 year, 2, 3, >5 years.
After that, from those groups I checked their returns since the past 2 years. I would have preferred to measue the return since their origin but I didn't find the way. Anyway, I think the results would be more or less the same.

This is the table with some figures:

Could discuss my personal criteria. But I think that if in 2 years you don't get at least 10% return in total, the Darwin is worthless. I suppose that we could consider a Darwin that gives us between 10% to 20% return per year as the Darwin of our wet dreams. And those with more than 20% per year the Masters of the World.

On the table above:

• Chances to get a Darwin that will provide money enough for a Living: 7% to 10%
• Chances to get a Darwin that will make us rich and enjoy cocktails on a Caribean beach: 1%

Well, conclusions? I see a couple of obvious things:
i) Trading is fucking hard
ii) Numbers between Darwins with more than 1 year experience are quite similar to those who have a much longer longevity. In fact, after year 3, results are almost the same. So, from here: After 1 year your results should have confidence enough to predict the future, and after 3 years the results are pretty certain. I could be wrong but I see what I see...

On this business where everyone look like owning the definite truth but nobody look like knowing really nothing. Getting some conclusions and cold references I think is comforting.

And yes, I know. Of course there are exceptions and see a Darwin crushing after 3 or more successful years. We all have seen and discussed about some of those Darwins. But at the end of the day, statistically the numbers don't lie.

 

[Captain Currency]

Good post @FXforfun!

 

[IlIlIlIlI]

@FXforfun Great idea and IMO it confirms that the 2y period as longest period on filters is enough.

 

[Muiris]

Just for the sake of crunching numbers. What chances would have a Darwin to make us rich? Or to make money for a living? Or just to make money enough to barely continuing trading?...

Well, I decided to make a break on my robots and crazy Forex ideas, and dive into the Darwin Universe to check for myself how is everyone struggling with the markets

First, Darwinex sample has 3.105 Darwins. Good enough for my taste. Let's move forward and play with some filters.
Simple exercice: I filtered the Darwins according its longevity - More than 1 year, 2, 3, >5 years.
After that, from those groups I checked their returns since the past 2 years. I would have preferred to measue the return since their origin but I didn't find the way. Anyway, I think the results would be more or less the same.

This is the table with some figures:
View attachment 308627

Could discuss my personal criteria. But I think that if in 2 years you don't get at least 10% return in total, the Darwin is worthless. I suppose that we could consider a Darwin that gives us between 10% to 20% return per year as the Darwin of our wet dreams. And those with more than 20% per year the Masters of the World.

On the table above:

• Chances to get a Darwin that will provide money enough for a Living: 7% to 10%
• Chances to get a Darwin that will make us rich and enjoy cocktails on a Caribean beach: 1%

Well, conclusions? I see a couple of obvious things:
i) Trading is fucking hard
ii) Numbers between Darwins with more than 1 year experience are quite similar to those who have a much longer longevity. In fact, after year 3, results are almost the same. So, from here: After 1 year your results should have confidence enough to predict the future, and after 3 years the results are pretty certain. I could be wrong but I see what I see...

On this business where everyone look like owning the definite truth but nobody look like knowing really nothing. Getting some conclusions and cold references I think is comforting.

And yes, I know. Of course there are exceptions and see a Darwin crushing after 3 or more successful years. We all have seen and discussed about some of those Darwins. But at the end of the day, statistically the numbers don't lie.

7-10% chance of getting a darwin to provide a living. sorry this just doesn't jive with reality of last 5 years

 

[CavaliereVerde]

The point is that nobody knows who are this 7% of lucky survivors BEFORE they produce the positive return.

 

[IlIlIlIlI]

The point is that nobody knows who are this 7% of lucky survivors BEFORE they produce the positive return.

You need a process, a strategy to find the winners in time (and sell them in time if required).
And the winner have to compensate the ones which run into losses.

So you can try it with the 32 candidates of the "get rich" level of @FXforfun and look at the result in 1, 2 or 3 years.

 

[FXforfun]

7-10% chance of getting a darwin to provide a living. sorry this just doesn't jive with reality of last 5 years

In order to start a discussion here we should define first what do you consider necessary to provide a living. From my point of view, if you achieve an engine that may increase your wealth by more than 10% a year. You have it. It's feasible. Well, 7-10% chances to get it say so.
Of course if you don't have any capital. You may have the engine but not even a 50% a year could provide you a living. And 50% a year is not feasible.
As I said on my post it's my personal criteria and each of us will have a different one and probably none of us will match. However most estraordinary hedge funds wordwide barely can get a 20% a year. And none of them are on Darwinex, aren't they?

My exercice was made from a trader perspective instead of an investor perspective:
As an investor I would like to be able to filter those Darwins with a real hedge.
As a trader I want to know if my Darwin has a real hedge.
Subtle difference here, but as trader I can start anticipating behavior from a year of results to Project on the next 5 years.

As an investor I wouldn't bet on the first 25 Darwins on the Get Rich level because those are just a number on a statistic. Probably those 25 will be replaced by another ones on the next year and they are going to rotate year by year.
Only thing I can extract from the table I made is that 1% is on the Get Rich Level. And this 1% probably is just noise. So, in my opinion the Get Rich Level is just a chimera.