The time frame shown in the initial ilustration belongs to a Bull Market. Are we focusing on the proper context for this issue? Those long retracements are within the context of a Bull market - what did you say Bulkousky theory is?
Legs are longer is just what I meant. Percentages do not mean much until after the fact, and they are a tricky mesuarement to use. You must keep variables at bay to measure something.
In trading the same amount ot shrs the longer legs obviously would be more profitable (each down leg contains a greater amount of dollars).
Also if you trade a safe % of your principal, that is a good idea, but it is detrimental when it comes to measurements. As your % changes dinamically with the size of your account, which in turns changes with the amount of opened or closed orders at any particular time frame.
If you really want to implement a constant 2% max lost in your account you must be constantly rearranging your orders. I hope you have automated software to do such a task.
Keeping all constant the down legs are obvioulsly more profitable, yet realize that this was in the context of a bull market therefore Bulkousky would be wrong in his theory.
If I am correct in mine, then he could be correct in his.
|
|
TRADER A
Profit/Loss: $14,322
Number of Trades: 42
Win %: 97%
Loss %: 3%
TRADER B
Profit/Loss: $9,100
Number of Trades: 18
Win %: 99%
Loss %: 1%
TRADER C
Profit/Loss: $11,421
Number of Trades: 32
Win %: 91%
Loss %: 9%
TRADER D
Profit/Loss: $16,867
Number of Trades: 48
Win %: 28%
Loss %: 72%
This is way unrealistic whatever the purpose. First of all any real, and professional trader knows that the losin % of trades is always far greater than the winning %. Only those who manage to keep those loses small and the winning trades big can survive in the market.
To give an example of 4 trader in which 3 out of 4 has greater % of winning trades is just unrealistic.
Much more information is needed to make any clear conclusion, but my initial review seems like a waste of time based on the information given.
To say that Joe got from A to B in 5 min doesn't say anything about how he did it, which path he took, what vehicle he drove, or what type of gear he packed, etc.
|