collapse

Author Topic: Outsidethebox HK Signals & PAMM funds  (Read 129401 times)

Online TR4DEX

  • Jr. Member
  • **
  • Posts: 8
    • TR4DEX
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1020 on: July 10, 2019, 07:13:23 PM »
aggressive low drawdown. Isn't that an oxymoron?

Online reinerh

  • DonbonsPrivateGroup
  • Hero Member
  • *
  • Posts: 2784
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1021 on: July 10, 2019, 07:21:25 PM »

Online alaali

  • DonbonsPrivateGroup
  • Full Member
  • *
  • Posts: 323
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1022 on: July 10, 2019, 09:32:19 PM »
Just look at the naming he uses. Aggressive low drawdown!

Can it be aggressive but low drawdown at the same time!

Online donbon2

  • Hero Member
  • *****
  • Posts: 2247
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1023 on: July 10, 2019, 10:28:25 PM »
I see the master is in 6% DD but these other accounts today -60 -70%

... really I am sick in the stomach just watching it/looking at it.
Broker - IC Markets   VPS - Amazon EC2 + CNS  

EA:
Powerflow NZDCAD
PZ Averaging EA
Autotrader Custom

News - Thomson Reuters Eikon
Trade Manager - Visual Trading Console for MT4
Trading Rebates - through CashBackFX
Trade Notification EA - TradeTalk from FX Blue - free
VPS - I recommend Amazon EC2 - if you qualify for a Broker Sponsored one get CNS
PZ Support/Resistance Indicator / Day Trading Indicator



Offline SJWkiller

  • Jr. Member
  • **
  • Posts: 99
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1024 on: July 10, 2019, 11:03:20 PM »

Online compujock

  • DonbonsPrivateGroup
  • Sr. Member
  • *
  • Posts: 1358
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1025 on: July 10, 2019, 11:04:09 PM »
https://www.myfxbook.com/members/OutsideTheBoxHK/mtcook-aggressive-low-drawdown/3319130

Another debacle... ;D

Awesome Trading OTB!  You know it's a serious Professional Trader doing the trading when they can lose 55% on one trade and 45% on another!


Offline NextGen4FX

  • Jr. Member
  • **
  • Posts: 19
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1026 on: July 11, 2019, 07:23:06 AM »
Just something else funny to look at...

Offline Nasdaq100

  • Full Member
  • ***
  • Posts: 426
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1027 on: July 11, 2019, 08:31:15 AM »
That's it, this guy for sure is mentally sick. He needs serious help!

Offline SJWkiller

  • Jr. Member
  • **
  • Posts: 99
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1028 on: July 11, 2019, 09:51:07 AM »
I am interested to see what will happen when DD gets to 12% again. Its now at about 10%...

Offline frescof

  • Jr. Member
  • **
  • Posts: 13
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1029 on: July 11, 2019, 11:27:39 AM »
Hi,

Here's an interesting read about Martingale, titled "MartinFail"

I can't seem (don't know how, more like) to add images in message using button provided, but you'll get the message.

<<BEGINS>>
Vladimir Kruglov, CTO of PsyQuation, PhD, invites you to become a mathematician for five minutes to explain why you cannot fool the market and why the strategy employed by every other trader will in the end, almost always lead to an account blowup.

This secret has been hidden from you for years! Win without fail A mathematical formula to provide you with a steady income! - This is how Martingale strategies are typically marketed.

We however know from our research database that this strategy only works when viewed in "favourable" conditions. When you trade real money, in the real market, it has an annoying habit of ending in financial ruin. Martingale strategies are seen by a huge number of traders as the Holy Grail, says Vladimir.

The principle rule of the strategy is very simple. Let us use the toss of a coin at a casino to illustrate the point. You place a bet, Heads you win a dollar. Tails the casino wins a dollar. If you lose, you double the bet. If you lose again you increase your bet to four dollars, and so on, until you win and start a new round of bets again with one dollar. In this way, at the end of each round if you win, you will always have exactly one dollar more than you had at the beginning. Let's do the math.

-1, -2, -4 (total loss 7) + (win) 8 = 1 (profit)
-1, -2, -4, -8, -16 (total loss 31) + (win) 32 = 1 (profit)

Such calculations, hidden in marketing language, befuddle the brain and seem more impressive than worrying. A common marketing trick is to say that rich people are hiding this simple mathematical truth: you can also earn as many of these plus-ones as you would like and buy the house of your dreams. "You cant lose" and in reality, you will not lose Vladimir grins "with one condition: that you have infinite capital".

In fact, the money will run out much faster than you imagine. In the course of normal market conditions a situation will soon arise where a successive number of bets will go against the trader resulting in a bet that could be in the millions or even billions of dollars. Important to note these runs of bad luck are the rule rather than the exception.

Here a simple example of a Martingale strategy:

In the table below we have assumed that you have an account with $1,000 and that you have a mean reverting strategy that enters a EURUSD trade when the market hits an overbought or oversold threshold by moving 0.2%. With an initial position of 0.01 (micro) lot, how many successive losing moves of just 0.2% will it take before you blow up your account?

Martingale Blowup Table:
   
As you can see after just 6 trades, i.e. a mere 1.2% (0.2% x 6) move, you will have run out of margin and blown up your account.

We then built a tool to analyze probabilities of failure based on the number of trades in a week and their max hold time (72hrs) in our example.

Human psychology is what keeps people coming back for more, with the mistaken belief that these strategies are profitable. You see the win rate, that is the number of times the strategy has winners is usually very high. People become accustomed to an ever growing equity curve. You then start to really believe in your superior talent. Unfortunately it only takes one reasonable size move to be wiped out and your dreams to turn into a nightmare.

In the chart below you can see a typical martingale equity curve. The deep drawdowns are typically recovered with incremental profit gains to produce a smooth (PsyQuation does not hide these drawdowns by displaying intraday data curves) upward sloping end of day equity curve.

Unfortunately the one who plays has to pay. Each new bid is far from free, but the trader whose thoughts are carefree with their fireproof strategy, tend to forget this uncomfortable truth with the inevitable drawdown blowup.

Typical Martingale Equity Curves
 
Think about it. To earn a dollar, you tend to do a lot of trades, which means commissions for these transactions can be quite high, as they increase in size with the length of the series before you close it with profits. Lets assume it goes -1, -2, -4, -8, -16, +32, which means that 63 dollars pass through the account before you get your single dollar of profit but the gain does not increase - it is still the same maximum of one dollar. As a result, the commission becomes another hurdle to overcome.

Martingale Commission Trap Calculator

We decided to do a commission sanity check with quite shocking results. We found that after factoring the spread and commission of each trade that after only 4 trades going against you the commission will be equal to your profit target. Let us think about what that really means.

Using our example with a take profit target of $2. After only 4 martingale trades you will have already spent more money in commission than you had anticipated making from the trade in the first place. Now you know why brokers love Martingale traders.

Martingale Account Lifetime Comparison

Using a random database sample of 6,255 accounts we created 2 groups: non-Martingale and Martingale. Martingale trades were classified Martingale if the trade size increased by more than 1.6 times with each successive sequence.

It can clearly be seen that in the long run, traders who trade using the Martingale strategy collapse far more rapidly, with a lifetime less than half non-Martingale traders. This is partly related to commission causing a constant outflow of funds and the enormous risk that grows exponentially with each successive trade.

The Final Word

In our study we looked at accounts with a position size growth of 1.6 times each new trade that have been put on less than 5hrs apart. We then look at average profit per trade up to a maximum of 210 trades. You can see that Martingale underperforms non-Martingalers. This is done on a per trade basis.

In this study we look at account profitability based on being categorized as Martingale or not. Here the results are more dramatic than looking at trades on a per trade basis. We see exactly what we would expect. The more trades a Martingaler does the worse they perform.

Conclusion

If you are offered a way of "always winning", think twice about it. Some people hooked on the Martingale strategy stop themselves out at a set limit of Martingale layers, say 4 layers. This can be a legitimate strategy if there is a genuine ability to identify market reversals. But after taking into account brokers commissions, it is clearly a losing strategy for almost all Martingale traders. The classic strategy of "double until you win" does not work in the real world of finance -  Now you know why!!!

Regards, Michael Berman, Ph.D. CEO & Co-founder PsyQuation
<<ENDS>>

Online primi

  • DonbonsPrivateGroup
  • Sr. Member
  • *
  • Posts: 948
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1030 on: July 11, 2019, 12:40:46 PM »
I am interested to see what will happen when DD gets to 12% again. Its now at about 10%...

Nothing will happen. Trades will remain, just like last time.

His trading does not work with 12% DD limit. He's at 12% again and he should really be showing a loss of about 20% for the month by now instead of profits.

Online user456

  • Sr. Member
  • ****
  • Posts: 1107
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1031 on: July 11, 2019, 12:52:29 PM »
would be nice if they somehow would implement that "wisdom" into their psyquation platform. Currently, they are not appropriately punishing traders using grid and/or martingale strategies with a lower score. Something at which Darwinex needs to get better as well. While a seasoned trader/investor could see from the start that the strategy has terrible risk management their algos ranked it pretty high for quite some time.

If I remember correctly, Greg was bragging about his high psyquation score for quite some time

Offline gpfwestie

  • Jr. Member
  • **
  • Posts: 58
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1032 on: July 11, 2019, 02:22:54 PM »
I got that email from PsyQuation too. The email seemed to come out at roughly the same time OTB blew up one of his accounts ... conspiracy ? maybe the PsyQuation guys were a bit embarrassed having consistently scored this system highly prior to the blowup.

As someone else said, these rating systems seem to fail at identifying risky trading. Seems to me, whenever they close a loophole  - another system is invented to beat it. Like an arms race.

Full marks for Darwinex for continually trying to weed risky systems out, but the goal may not be achievable.

Offline petersurrey

  • DonbonsPrivateGroup
  • Sr. Member
  • *
  • Posts: 965
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1033 on: July 11, 2019, 03:01:27 PM »
would be nice if they somehow would implement that "wisdom" into their psyquation platform. Currently, they are not appropriately punishing traders using grid and/or martingale strategies with a lower score. Something at which Darwinex needs to get better as well. While a seasoned trader/investor could see from the start that the strategy has terrible risk management their algos ranked it pretty high for quite some time.

If I remember correctly, Greg was bragging about his high psyquation score for quite some time

Agreed - still too easy to hide risky systems @ Darwinex - low RA and RS values ( 3.5 and less) usually mean it is a marti/gridder; and if you drill down through the 'underlying strategy' it shows how many open trades are used...and if they increase with each trade you should avoid...

Online vik2001

  • Jr. Member
  • **
  • Posts: 53
Re: Outsidethebox HK Signals & PAMM funds
« Reply #1034 on: July 11, 2019, 03:47:39 PM »
this guy is unbelivable.   he will exit shortly im sure and be back in a few months with a new identity like some others have done.
the only grid strategy over the years whos had a success has been Blackwave Pacific/California run by Gary.  hes still going strong and uses better risk management.

 

browse forum

* Recent Posts

Re: Z Trader FX EA by reinerh
[Today at 07:51:15 PM]


Re: Will cryptocurrencies like Bitcoin ever gain mass adoption? by Eliza Abrams
[Today at 04:35:38 PM]


Re: EUR/USD by Eliza Abrams
[Today at 04:30:33 PM]


Re: Z Trader FX EA by rsmereka
[Today at 03:05:01 PM]


Re: Good uk broker? by drunkfx
[Today at 02:25:41 PM]


Re: forex cyborg by ForexCyborg
[Today at 12:03:50 PM]


Re: Leverage query by vik2001
[Today at 11:12:31 AM]


Re: Leverage query by gpfwestie
[Today at 10:01:15 AM]


Re: Quitting my job to trade full time by drawdownrecovery
[Today at 07:55:57 AM]


Re: Which is the best trading platforms by drawdownrecovery
[Today at 07:50:22 AM]