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DIY Frequent Trader

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diyforexskills:
New signal service to start in 2021

In conjunction with Odysseia Capital, we will shortly be offering the DIY FrequentTrader signal service.

Great Performance with Performance-based Fees
Results from all the development and testing are highly encouraging with an expected monthly return of 5 to 10% per month trading at 0.01 lot per trade with a performance-based subscription fee of 20% above the high-water mark. So you only pay when you have made a profit for the month. The first image below shows the demo test account operating at twice the intended lot size. Hence expectation is for monthly return closer to 10%.  https://www.fxblue.com/users/diyfreqtrader

Flexibility and Options
With ASIC (Australia) joining FCA (UK) and ESMA (Europe) in limiting the leverage brokers can offer retail clients to 1:20 for the minor forex pairs by end March 2021, this signal service is being designed to enable trade copying of all nine pairs to a minimum $5K account set to 1:20 leverage.

Subscribers will have options depending on the account size and/or the leverage they wish to trade.

Subscribers who wish to operate larger accounts and/or operate with brokers offering higher leverage, will be able to adjust the lot size of the trades they receive and hence be able to achieve higher returns. For example, the demo test running since 9 November on a $5K account with double the lot size (0.02 lot) and 1:400 leverage has performed as shown with margin levels always well above 2000%. Maximum open drawdown has not exceeded $1000 during these two months of trading.

Subscribers who wish to operate smaller accounts have two options:
1.   Still trade at 1:20 with an ASIC, ESMA or FCA regulated broker but only trade a few (uncorrelated) pairs. Eg trade on a $2K account but only for USDJPY, GBPCHF and EURAUD
2.   Trade with a broker that still offers 1:400 leverage in which case $2000 would be sufficient.

Portfolio Characteristics
The strategies employed in this portfolio were developed on the FX Autotrader Elite and are all variations on a theme. We recognise that good entries are important but clever and realistic exits are even more important given how chaotic markets are. Consequently, most trades are closed as part of a basket of trades consisting of Initial, Re-entry and judiciously-placed scale-in trades. And we are happy to close at small profits, frequently, rather than agonisingly waiting to see if we can catch a trend. In order to avoid runaway losses, all trades have a maximum life span of 30 H4 bars or 500 M15 bars, roughly equivalent to 5 days of trading; long enough for price to be able to revert near to its mean and hence a close in profit or reduced loss; but not too long to accentuate the loss.

We will generally have an open drawdown (DD) varying anywhere from $50 to $500 on the Master account trading at 0.01 lots. But even as the open DD increases, we continue to close trades in profit building up our Account Balance. Open DDs can rise fast but also decline fast. By the end of the week of 22 December for example on the demo account, open DD fell by 70% from its high. Profit factor has been above 2 for most of the test period as shown in the second image below.

Subscription
The sign-up process is being finalised and will be available early in 2021. We assume that potential subscribers will want to see some period of trading on live before making a commitment. The Master account on live will commence trading on 4 January 2021.

On sign up there will be a quarterly Service fee of USD$5, ie USD$5 every three months billed automatically via PayPal, with Invoices sent on the second day of each month for the 20% of profit above high water mark on the subscriber’s account. This latter fee will need to be paid within two weeks to ensure continuity of signal.

Inquiries
Pls contact us at info@diyforexskills.com for any further clarification or to register interest.

diyforexskills:
A Timely Reminder

One of the issues with portfolios is to avoid excessive correlation or having too many strategies with the same symbol. By running the test of this portfolio through December, that issue has been brought into sharp focus. Far too many trades with EUR and to a lesser extent with CAD. We see that in the Sig where Equity is down a lot - open DD went up to $1600 last night. Of course this is while running at twice the intended lot size, but nevertheless...

So when we start live next week, we will remove the EURAUD strategies as well as the CADJPY, leaving us with seven pairs to trade.

When we filter the demo test account for that change we see a much improved Equity performance whilst still having an impressive return of $2000 in closed profit over the seven week period from 9 November and current open DD of around $200. And a more balanced trading portfolio.

diyforexskills:
A New Year

We have used the December market data to take a fresh look at all the strategies. And have re-optimised accordingly including the addition of a dynamic exit to all but two of the strategies. This has also enabled the removal of most of the scale-in trades and provides us with a balanced portfolio of eight symbols each with separate Buy and Sell strategies.

(Scale-ins were being placed as pending orders and we realised that pending orders are included in margin calculations; with leverage possibly at 1:20 (new ASIC rules) it pays to reduce the demand on margin. The Autotrader is also being modified to place scale-ins as market orders which will be good for use with the two strategies that are using scale-ins.)

At the same time we are also looking to fix a glitch with the automated Invoice procedure for performance fees. Hence we will start trading the live account by tomorrow but not offering the subscription link until that is fixed. In any case prospective subscribers will want to see some live performance data before considering signing up.

We will leave the current demo test myfxbook in the Sig for a while longer to see how it recovers from the December hammering. Note however that the new portfolio will be different with fewer symbols and less correlated. Back tests of strategies to run in 2021 do not exhibit the strong open DD of this demo test account.

The symbols now to be traded in 2021 are AUDNZD, CADJPY, EURAUD, EURNZD, GBPAUD, GBPCHF, USDCAD and USDJPY.

diyforexskills:
Demo Test Account in December

The last two weeks in December are normally regarded as not being good for trading. That is why it was important to keep the demo test of the DIY FrequentTrader portfolio running during that time.

So open DD did plummet to around $1600 but as the image below shows, we also closed out almost $1600 in profit in December. So zero net gain/loss for the month should all of the open DD be closed in loss. But it has not to date and open DD has receded.

Open DD is now around $800 and closed profit has not taken a hit - as yet. Some of the losing trades are due to be closed in a day or so, hence we should expect to take some losses. But hey, the portfolio is up 52% in just two months, so some loss will not be a worry.

Note however that this demo test account is running at 1:400 leverage and it would not have survived running on $5K at 1:20. Probably OK at 1:100 or even 1:50. Hence the changes we have made going forward as described in previous Post in order to play it safe and sensible.

diyforexskills:

--- Quote from: diyforexskills on January 05, 2021, 04:46:49 AM ---Demo Test Account in December

The last two weeks in December are normally regarded as not being good for trading. That is why it was important to keep the demo test of the DIY FrequentTrader portfolio running during that time.

So open DD did plummet to around $1600 but as the image below shows, we also closed out almost $1600 in profit in December. So zero net gain/loss for the month should all of the open DD be closed in loss. But it has not to date and open DD has receded.

Open DD is now around $800 and closed profit has not taken a hit - as yet. Some of the losing trades are due to be closed in a day or so, hence we should expect to take some losses. But hey, the portfolio is up 52% in just two months, so some loss will not be a worry.

Note however that this demo test account is running at 1:400 leverage and it would not have survived running on $5K at 1:20. Probably OK at 1:100 or even 1:50. Hence the changes we have made going forward as described in previous Post in order to play it safe and sensible.

--- End quote ---

Back to (more) Normal

On the demo test account the EURAUD losing trades have now all been closed, and the portfolio is now back to more normal levels. It made $1900 in December, and it has given back about $800 of that so still not a bad return for the month.

We have removed the three EURAUD strategies that were running in 2020 and have replaced it with just the one, but separate charts for Buys and Sells. Still scalping but now with an added dynamic exit to avoid what happened in December. We will keep this account running in parallel with the new live account so that we have ready alternatives should any of the revised strategies on the new live account require replacement.

Live Account activated

The live account with the revised strategies (refer Post from 4 Jan) is up and running, currently in small loss of 2%. More on that next week.

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