Swing Trading %b System | Foreign Exchange EA Download- MT4/MT5 Resources
Dear colleagues,
This year has taught us many painful but important lessons. I started trading 3 systems this year
1. Arbitrage trading non-stop hedging system. The year is over -97%
2. The swing system is boring, slow and has no signal for long periods of time. End the year +35%
3. The ended position system +50%
I trade with 3 systems at 3 different brokers, but guess which system performed best mid-year? Guess which system I put the most money into? Guess which system provides the most emotional reward in day-to-day trading as your account balance grows steadily?
You guessed it; an arbitrage trading system. The system collapsed with heavy losses of capital. Boring stop system to be profitable by year-end
Personal Lessons (Of course, these fit my personality and may not apply to other personality types)
1. No matter how well the system works, never trade without a stop loss. Unpredictable, statistics-breaking black swan events will occur. It's better to bleed out slowly than to lose everything in just six weeks.
2. Don’t trade primarily for emotional pleasure. Be skeptical of systems that are emotionally appealing and provide short-term instant gratification. The slow turtle wins the trading marathon.
3. Money management and position sizing are truly the most important parts of trading. This means you will survive as a trader, or at least, exit the arena with your head down, but with some of your original capital left.
4. Take the long-term view when evaluating trading systems. 3 months is definitely too short, 6 months is a glimmer of hope, 1 year is more reliable, 3 years is to build confidence, and more than 5 years is guarantee and confidence (I haven’t arrived yet, I have only been trading for 3 years)
Anyway, as a way of giving back to the trading world, I've received a lot of help from other traders and I'm releasing my swing trading system. I started with the idea of an index trading system, but I developed my own formula for position sizing, stops, and exits so I felt like I could call it "my own."
It has a positive expectation and a winning probability of 55%. Average profit/average loss>1. (It will vary depending on which exit signal you take, but both are >1). The maximum drawdown this year is 17%.
The numbers are not eye-catching and may not work for some traders (win probability and drawdown), but I have been trading for the past two years and ended both years with profits that exceeded the performance of my professionally managed pension fund.
Hope that helps. I will answer any questions over the next few weeks if needed.
PS I'm always looking for other proven swing trading systems.
Cheers Terry
This year has taught us many painful but important lessons. I started trading 3 systems this year
1. Arbitrage trading non-stop hedging system. The year is over -97%
2. The swing system is boring, slow and has no signal for long periods of time. End the year +35%
3. The ended position system +50%
I trade with 3 systems at 3 different brokers, but guess which system performed best mid-year? Guess which system I put the most money into? Guess which system provides the most emotional reward in day-to-day trading as your account balance grows steadily?
You guessed it; an arbitrage trading system. The system collapsed with heavy losses of capital. Boring stop system to be profitable by year-end
Personal Lessons (Of course, these fit my personality and may not apply to other personality types)
1. No matter how well the system works, never trade without a stop loss. Unpredictable, statistics-breaking black swan events will occur. It's better to bleed out slowly than to lose everything in just six weeks.
2. Don’t trade primarily for emotional pleasure. Be skeptical of systems that are emotionally appealing and provide short-term instant gratification. The slow turtle wins the trading marathon.
3. Money management and position sizing are truly the most important parts of trading. This means you will survive as a trader, or at least, exit the arena with your head down, but with some of your original capital left.
4. Take the long-term view when evaluating trading systems. 3 months is definitely too short, 6 months is a glimmer of hope, 1 year is more reliable, 3 years is to build confidence, and more than 5 years is guarantee and confidence (I haven’t arrived yet, I have only been trading for 3 years)
Anyway, as a way of giving back to the trading world, I've received a lot of help from other traders and I'm releasing my swing trading system. I started with the idea of an index trading system, but I developed my own formula for position sizing, stops, and exits so I felt like I could call it "my own."
It has a positive expectation and a winning probability of 55%. Average profit/average loss>1. (It will vary depending on which exit signal you take, but both are >1). The maximum drawdown this year is 17%.
The numbers are not eye-catching and may not work for some traders (win probability and drawdown), but I have been trading for the past two years and ended both years with profits that exceeded the performance of my professionally managed pension fund.
Hope that helps. I will answer any questions over the next few weeks if needed.
PS I'm always looking for other proven swing trading systems.
Cheers Terry
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