Welcome back Forex fans and Meta-Traders.This past 5 days had to be one of wildest weeks in recent memory for the Forex and financial markets in general. EUR/USD tumbled 580 pips to a one year low on higher daily ranges than we've seen in over a year. US Equity Markets tumbled and nearly wiped out year to date gains.
So how did our forex robots make out?
God's Gift GBP/USD had a spectacular week, picking up 150 pips on single short GBP/USD trade. It would have made more except it has a 150 pip take-profit. In any case, this robot gained 11% on the week and is up about 18% year to date.
Megadroid Demo had a solid week and picked up its customary 10-pip take profit like clockwork on Tuesday, Wednesday and Thursday. Conditions were were good for Megadroid although the take profits seem kind of small in this type of market. Megadroid demo leads the pack up 20.1% for the year and is holding true to my 1% a week mantra.
Megadroid Live continued to recover from recent drawdown and picked up 10 pips which was doubled in terms of return because it remains in "Recovery Mode" trading 0.18 lots instead of the usual 0.09 lots.
God's Gift EUR/USD picked up a half percent on the week and is up about 3.7% on the year.
To conclude, the Forex robots, which are trading less than 1% of my real money are out-performing the equity markets which are trading the bulk of my funds. To put things in perspective, though, i've been trading equities for over 25 years, and i've only just found out about Meta-Trader in the last 6 months!
So for now my plan is to continue to learn and observe and get a whole year of Meta-Trader under my belt before I start to commit any more serious funds.
Check back later for some cool developments in the land of the Meta-Traders.
Sometimes I get the feeling God's gift is a type of turtle trader... I suppose Daniel can correct me if I am wrong. :)
ReplyDeleteThe wild week would have only landed me a good trade on the GBP/USD with Tiger Tail, however I got caught with the re-quote error, I think I mentioned this on you last post. I made a tweak to it to refresh quotes. However I may also do some additional tweaks in the future... I do some calculations before I make the trade, this requires some execution of X amount of time. If I can determine some of the calculations before the trade..., I can execute the trade with less code execution before the OrderSend.
Anyway, I am glad to see you are doing well. I did not know you were in commodities. Or I may have forgot you mentioned that. With such a large amount of years experience you must do pretty well :)
JT
Hello Everyone,
ReplyDeleteThank you for the update Chris :o). I am glad that the systems are performing so good, as a matter of fact this week was particularly profitable for most systems because of the very directional and volatile trading. The turtle trading system in fact entered some trades which managed to eventually get a profit higher than 2000 pips when the EUR/USD hit bottom.
However I would have to say that the God's Gift ATR and the Turtle Trading system are very different. . For example they are different because :
- Draw down / profit targets are very different
- Turtle Trading system targets month long movements while the God's Gift ATR targets movements that last only 12-24 hours in average.
- The God's Gift enters trades on retracements, the turtle trading system enters trades on breakouts
- The turtle trading system exits trades on breakouts, the God's Gift ATR exits trades on several indicator based mechanism.
-The Turtle trading system builds positions as the trend evolves, the God's Gift does not.
However they are similar in some ways. Both systems:
- adjust their positions in terms of the ATR
- attempt to follow trends
- are made to achieve long term profitability
- They are both likely to be long term profitable
So you could think of them being part of the "trend following" set of expert advisors but their strategies, movement targets and characteristics are completely different so calling them "very similar" would be misleading.
Now regarding what Chris said about stocks vs forex, I have found out that performance may actually be somewhat "hedged" between both. When stocks fail we tend to have huge directionality which benefits forex strategies while periods where stocks raise tend to have much milder movements which many times make the exploitation of inefficiencies in forex very hard. Automated systems which are indeed profitable tend to have draw downs which are also pretty strong and in line with the loses experienced by stocks in times like this. (of course this may sound too simple, and in fact I have done an over simplification to better explain the idea)
So, what I want to say is that a statistically significant period may be needed to evaluate long term profit/draw down targets and this period length (according to my mathematical analysis) needs to be of about 5-6 years. In the end profits and draw downs may be better than in stock trading but not by as much as most would love to think :o)
Anyway, it is always a good idea to do both as - like I said before - trading both markets may provide a "hedge" against different types of market conditions. Something which I think may be a reason why Chris is experimenting on this field. Again, thank you very much Chris for another interesting update :o)
Best Regards,
Daniel
Interesting what method do you use for trading equities.
ReplyDeleteHi guys and thanks for the comments.
ReplyDeleteJT - I haven't traded commodities, but had some experience with Options and Single Stock Futures (SSF's).
Also years of experience doens't necessarily translate into positive returns. I've had some spectacular years and some lousy years. The one thing I have learned is to be selective. 1 really good trade can overcome 10 lousy trades and most of the time the market is telling you nothing. So be patient and wait for the big move. I highly recommend you read "Reminiscences of a Stock Operator" by Edwin Levefre, its a classic.
Daniel-
Thanks for all the great insight on Turtle versus God's Gift. Since both are trend-followers I suspect they are more closely correlated with equity returns and global markets than scalper-type systems.
My working theory is that a good scalper can provide a smoother return with less drawdown than a trend-follower. As you know i'm still waiting for that to prove itself in reality.
The one thing I can say with certainty is that 3 of the 4 above accounts are outperforming the SP-500 year to date.
Lee-
I'm basically a trend follower plus fundamentals, plus news, plus underlying macro theme. My favorites stocks right now are AAPL, HMSY, SXCI, YUM and NFLX. I can't say its easy or always profitable, and to tell you the truth I would much rather just pull in a steady 1% per week a-la megadroid.
Thanks again for the great comments guys,
Chris
Hey Everybody,
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