The way to go? Techniques for making profit

[Petko Aleksandrov]

Good point!

I would also suggest you keep it simple. In the past, I used to have dozens of Demo and Live accounts which I was using to test 1000s of EAs. And the daily check was obviously taking me a few hours. So I started checking the account 3 times a week, after that, just 1-2 times during the weekend was wrong.

As Samuel says, it is better to check daily but quickly (so you won’t lose a lot of time with that).

More, it depends on what time frame you are trading. If you use M1 and you have many trades daily, then you need to check often. But if you trade on H1, H4, or D1, you won’t have a lot to check.

So finding the golden middle would be best.

[Samuel Jackson]

That’s been my learning too Petko.

Aiming to keep things simple is always best and if what ever you are trying starts to feel too complex then take a big step back and do some thinking!

Also fallen victim to trying to manage far too many demo accounts. Finding the golden middle ground as you say with regards to simple systems and the amount of tests you are running at once is really important otherwise it can all get too messy and its easy to end up learning nothing because the lessons are all to jumbled. Less haste is more speed as they say 🙂

[Petko Aleksandrov]

Absolutely!

And everyone should be enjoying it, and not struggling with it.

Plus, the IDEA of algo trading is not spend a lot of time on the PC 🙂

[Matthew Roberts]

I’d like to update you.

It’s been 3 months since I shared my strategy that I was going to test on a demo.

Here’s an update with the profits and losses of the demo.

Starting Balance
$  10,000.00

3/24/2022 – 4/7/2022
$    6,582.10
4/7/2022 – 4/21/2022
$  (2,037.61)
Month 1 Total
$    4,544.49

4/21/2022 – 5/5/2022
$  (1,160.98)
5/5/2022 – 5/19/2022
$    4,132.21
Month 2 Total
$    2,971.23

5/19/2022 – 6/2/2022
$  (3,325.80)
6/2/2022 – 6/21/2022
$          83.52
Month 3 Total
$  (3,242.28)

Ending Balance
$  14,273.44

 

The contract size is 10 on my broker. I started with .10 lots.

At the end of every 2-week period, for every 2000 I gained or lost, I increased or decreased my lot size by 0.11.

 

I’m not happy enough with my results to trade live as month 3 was a total bust.
Any suggestions?
My demo is still in profit which is great!

[Petko Aleksandrov]

Hey Matthew,

Glad to see you shared your results.

Can you make it clearer how you decide to increase or decrease your lots? And why would you do that?

Also, did you make any changes to the parameters or just the trading amount?

Petko A

[Matthew Roberts]

Hi Petko,

I am making no changes to the strategies. No manual entries, exits or modifications are being performed.

 

As for why I change my lots it’s in attempt to compound my account with the profits. For example a person with $100,000 could trade larger lots than a person with $10,000.

See below for how I am scaling it.

 

Every time I run a new batch of bots I’ll input the below formula to decide which lots all of the robots in the portfolio will trade at for the 2 week period I run them.

I am essentially adding extra lots as my account size scales up or down.

The exact formula

initial lots = (Beginning Balance / 1000)/100

new lots used = initial lots + ((Current account balance – Beginning Balance)/2000)

 

So my beginning balance was $10,000 so the first 2 week period I ran .10 lots on the portfolio and gained $6500.

After that I made new bots and plugged in the new lots used formula.

.10+{[($16,582.10-$10,000)/2000]/100} =.1329105

I always round down so I used .13 lots on the second round and so on until I posted here.

 

Any other suggestions as to what might be causing some of these periods to not be profitable?

[Samuel Jackson]

Hi Mathew.

This seems like a big success really. Especially as you were just getting pure losses hen you entered this thread right?

Balance drawdowns are pretty inevitable. Have you been keeping an eye on your equity drawdown?

Also am I right in that you are moving EAs from demo to your mock live account monthly and still working with the same EAs on the original demo?

I would recommend keep doing what you are doing for another month or two but also maybe run a second system side by side using the EXACT same process.

It could be that this is just a natural drawdown and you may get another profitable overall three months OR perhaps the life cycle of your system starts to deteriorate after 2-3 months?

4+ grand profit on a 10k account over three months is a great result as far as I am concerned.

[Matthew Roberts]

My equity drawdown is fine.

In fact, my equity was so high at one point I would have passed a $100,000 proprietary trading firm challenge phase 1. But phase 2 I would have failed.

I do a brand new system every 2 weeks and get rid of the old bots not caring how they would have performed.

I read in other forums that Petko aims for about a 50% return every month.

I’m curious for any suggestions on how I might change it up to gain results similar to that.

Currently, I’m doing the same method I was using, however, I’m adding more assets to see how that works.

I’m interested in adding XAUUSD.

Any suggestions on SL and TP limits and how much backtest data should I be using to get to a minimum of 300 trades without getting the what I like to call “can’t generate enough strategies” message.

 

[Samuel Jackson]

yeah but your balance drawdown recently was ~18 % which as you say would fail a prop challenge. Likely your equity drawdown was greater but would be good to know what it’s been throughout the life of your account.

for example if it hit 20% and you knew that then reducing your lots size by just over half would have kept you in the challenge right?

Of course it reduces the profit you will get so that needs to be balanced.

Seems like you are going pretty good though, I’d keep doing what you are doing and if you wan to try anything different then do so on a separate account.

Okay so by brand new system you mean you just go straight to live without any demo. Seems to be working well, would be definitely interesting to see how doing same thing for a few more months. If overall it works well again for three months then that would certainly give much confidence  I’d say

[Matthew Roberts]

Hey Samuel, I should have been more clear. I was using risk settings meant for a 100,000 FTMO account. The max draw down I had for a day in the system was 4125.00 which passes the FTMO max draw down of 5% per day requirements. And the max draw down overall was never even close to the 10% allowed at FTMO.

I’m finding that my system seems stable enough to not lose money, but it’s not making enough money to pass a prop firm challenge.

I’m looking for that extra boost in profits. I’ve seen that Petko aims for 50% per month using eastudio… that’s absolutely amazing. I’d love to reach a point where I can gain even 15% consistently. This way I can be sure to beat a prop firm challenge and get going full time in my forex career freeing me up to pursue my music dreams.

Petko, any suggestions?

[Samuel Jackson]

Hey Matt,

Well that’s definitely looking great then. The prop challenges are definitely tricky to get through but it sounds like you are getting close with your stable results.

It’s definitely the daily drawdown that is the trickiest to pass while making profit target as you are finding.

How many EAs are you trading? Diversifying further could help you achieve a better reward to risk ratio.

 

[Matthew Roberts]

Hey Samuel, I tried diversifying and made a small amount of profit on month 4.

I added BTCUSD, GBPJPY, and NAS100. Using the top 10 strategies.

gbpjpy I found I had to increase the amount of time to years to generate enough strategies with 300 count trades 30% out of sample.

that’s said, all else equal it was my highest winning pair in fact the demo account made about 7500 in a month in just that pair alone.

BTCUSD has been the big loser this month almost losing all of that 7500 and nas100 was barely a winner. With that said, maybe I should venture into more forex pairs.

I like to follow the rule atleast 10 to 15 trades per month for a strategy and I couldn’t get eurusd to generate enough strategies at 300 count trades at 24 months, then I tried 30 months and still couldn’t. Anything past 30 months is less than 10 strategies per month and I’m really not interested in that pair any more.

Any thoughts on what forex pairs might be able to generate enough strategies with 300 count of trades in 24 months?

 

I think I’ve mentioned this before but just in case:

Profit factor required for acceptance is 1.2 in and out is sample 30%.

minimum count trades 300

[Samuel Jackson]

Hey Matthew, yeah now would not be a good time for EAs on crypto in my opinion. I tend to prefer to trade indexes differently and only in the long direction.

I mostly stick to diversifying within forex though.

What timeframes are you using? 300 trades in 24 months is quite a lot so I can understand why it’s hard to get lots of strategies passing this with a good profit factor.

Also btw your stop loss and take profit ranges can make it harder to find strategies if too tight so you could try increasing that. What are you currently using, if 10-100 then I suggest the following.

Open as many reactors as you can on your computer (my rule of thumb is a reactor for each processor core) each with the same settings on a different pair using your preferred timeframe (I am assuming M15?), make sure stop loss and take profit limit is set to 20-200. Run for 24hrs and then see what pairs have more strategies that meets your acceptance criteria.

You could do this several times with a few different batches of symbols and you can take note of the pairs that are working best for you.

[Matthew Roberts]

I’m doing H1 time frame.

10 to 100 TP and SL.

That’s a good idea to see which pairs will create more strategies.

Could you further explain why 20 – 200?

[Samuel Jackson]

Hey Alan,

Its will just give more range for EA studio to work with and find strategies. If you are getting plenty strategies for certain symbols then you could reduce the range a bit for those symbols and vice versa for the ones not getting many strategies.

Start with some general settings and tweak a few things for each pair. You could for example increase these ranges as suggested if not getting many strategies and if still at 200 and getting no strategies you can then start reducing the strictness of your acceptance criteria in stages, for example reducing your 300 trade requirement OOS to 200 trades and see the effect.

Take note of what works well for each symbol so you don’t have to repeat the process as it may take a week or two.

[Author]

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