But trader bulls-t aside, R is a very useful tool that should be part of our trading process regardless of what strategy we no com use repaint fxprosystems. It’s essentially a risk framework, that can quickly tell you how and why you make or lose money in the market.
But before we delve in further – allow me to digress. I stated above that we should stop fxprosystems com no repaint calling trades – “trades” and start thinking of them as bets. Because the word “trades” has a false connotation to it. Trades imply open-ended narrative structures that can turn into psychological crutches as we hang on to the story arc long past its ending because we are convinced that we are “right”. Bets, on the other fxprosystems no com repaint hand, are binary and final events- which is exactly how we should approach what we do. As traders, we don’t “invest” in stories, we make market bets and play the odds via R. (Yes, I have been reading a lot of Ray Dalio lately and regardless of whether fxprosystems com no repaint you think Bridgewater is a cult or not, his philosophy of radical transparency is the perfect way to view our role in the market) Lastly, stop thinking about daily, weekly, monthly, annual fxprosystems com no repaint returns.
Fxprosystems com no repaint Out.The question – how much can I make this year should never enter your mind again.
Annual returns are simply marketing bulls-t pumped out by Wall Street for civilians who have fxprosystems com no repaint no clue how markets work. The only way to honestly evaluate your performance is over a fxprosystems com no repaint number of bets and 100 is as good com repaint fxprosystems no a round number as any. So, if you can achieve some positive multiple of R over 100 bets. Now, in reality, 2R trades happen 25% of the time (did you really think the no markets com repaint fxprosystems would give you any more than that? ) Occasionally, certain strategies and certain pairs can give you 30%-32% win rates on 2R trades and fxprosystems com no repaint that is as good as it can get, fxprosystems com no repaint because just like a casino with 51%-49% advantage in roulette, you can make a lot of money out of a thin edge. The key, of course, is to mitigate risk as soon as possible. You can move the stop to automated trading online breakeven as soon as trade goes 1R in the money and then wait for 2R to fxprosystems com no repaint hit 31% of the time.
If the be stop happens 50% of the time you are well ahead on this strategy.
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Looking at markets through the prism of bets and R has really helped me spot my own weaknesses much quicker. About 4 hedging robot forex weeks ago after a very long period of focusing only on systems, I started doing weekly prop trades for BK (basically K beat fxprosystems com no repaint me into submission into doing it). I am fxprosystems com no repaint up more than +500 pips on the recs fxprosystems com no repaint despite Trump’s best efforts to disrupt the FX markets on a daily basis.
But taking a look closer at what I was doing I realized that I had a glaring flaw in fxprosystems com no repaint my approach. I’ve been using 100 pip stops 40 pip T1 targets and 100 forex duality system download pip T2 fxprosystems com no repaint targets for essentially a maximum. Generally, you want to keep your maximum R at 1 to 1. 5 so that you can be positive fxprosystems com no repaint on anything better than 50%.