04-19-2018, 07:24 AM
The pros often say that keeping your trading strategy simple is of prime importance.
I understand that and agree, somewhat. But I'm a programmer at heart, so when I see a challenge I often want to create a solution.
Risk management is a huge part of being successful at trading. Huge. Having tried my hand at day trading in the past it means a lot to me. Here's an interesting article that makes this point and others in a useful fashion:
What It Takes to be A Successful Day Trader
http://www.crbtrader.com/trader/v09n01/v09n01a01.asp
We're not trying to become day traders. But we are trying to simulate them. So their observations can be instructive.
The author said good traders don't trade every day. Some days things aren't suitable, not enough trend or volatility, whatever. Too risky. Makes sense. You can see it on the chart.
That reminded me of some of the Gekko strategies I've looked at with strings of bad trades in an otherwise successful strategy. Made me wonder if there might be a way to leave the strategy mostly alone, but add a simple mechanism to identify bad days and avoid trading them. Volatility, trend, volume, something. Target those days and leave the rest alone.
Just a thought. There will always be bad trades. Finding ways to skip or minimize some of them seems worth strategizing about. No doubt a lot harder than it sounds.
I just read that 75% of trades in the traditional markets are done by bots. And I also read that more whales are targeting cryptos. So it makes sense we need to manage our risk well.
Richard
I understand that and agree, somewhat. But I'm a programmer at heart, so when I see a challenge I often want to create a solution.
Risk management is a huge part of being successful at trading. Huge. Having tried my hand at day trading in the past it means a lot to me. Here's an interesting article that makes this point and others in a useful fashion:
What It Takes to be A Successful Day Trader
http://www.crbtrader.com/trader/v09n01/v09n01a01.asp
We're not trying to become day traders. But we are trying to simulate them. So their observations can be instructive.
The author said good traders don't trade every day. Some days things aren't suitable, not enough trend or volatility, whatever. Too risky. Makes sense. You can see it on the chart.
That reminded me of some of the Gekko strategies I've looked at with strings of bad trades in an otherwise successful strategy. Made me wonder if there might be a way to leave the strategy mostly alone, but add a simple mechanism to identify bad days and avoid trading them. Volatility, trend, volume, something. Target those days and leave the rest alone.
Just a thought. There will always be bad trades. Finding ways to skip or minimize some of them seems worth strategizing about. No doubt a lot harder than it sounds.
I just read that 75% of trades in the traditional markets are done by bots. And I also read that more whales are targeting cryptos. So it makes sense we need to manage our risk well.
Richard
