Acting in my own best interests!

High volatility

Dave — Mon, 07 Jun 2010 03:07:22 +0000

As you may have noticed, my attempt at correlated trading to reduce draw down hasn't quite worked out as planned. The moves on the EURUSD have been very dramatic and sustained. Although the strategy is coping well, I would be reluctant to put real dollars on the line until things calm down.

The next couple of days will really test the strategy.

Additional analysis on Dodo Hedge

Dave — Sun, 30 May 2010 22:34:25 +0000

I have commenced a new method of tracking performance for the Dodo Hedge strategy.

The following chart is driven by a spreadsheet (I love Goggle Docs by the way), to track a weekly maximum unrealised P&L against the profit generated for that week.

My aim for this additional tracking and reporting is to be able to establish:

where to set the account equity protection stops
determine a pseudo risk & reward
understand how long would it take to set a new peak equity high, should a stop get hit

M5G Cyborg – Tests complete

Dave — Sat, 29 May 2010 12:34:09 +0000

Both these tests have been disappointing. Since I purchased this system 9 months ago, it has at best, broken even. I have decided to park these tests and I may dig it out at a later time.

The current market volatility looks set to stay for a while, and this system does not seem well suited to it.

Correlated Pairs…the new low draw-down frontier?

Dave — Tue, 25 May 2010 05:31:33 +0000

My next foray into hedge trading (and my continued attempt to evade discretionary trading!) I am focusing on hedge trading principles across correlated pairs. Be it positive or inverse correlation, I am not discriminating.

The tests that I am most excited about at the moment are the EURUSD & USDCHF, and on the 'Active Tests' page its called the Dodo Hedge. Look for more under the 'Dodo' pseudonym which will be variations on this theme. At the moment, I am using the inverse correlation and selling both waiting for them to de-correlate sufficiently to profit from the net profit across both positions. Hence, you will only see 'sells'.

This approach has been around for ages, my slight departure from the 'standard approach' is that I have a grid every 25 pips which can profit in it's own right. I just need to tweak the grid settings, but essentially I can make a profit by de-correlation or one side's grid meets it PT.

As my broader hedge trading strategy is having a rest due to volatile market conditions, I am focusing on approaches that will minimise draw-down. Lets see if this is possible. I think my equity growth ambitions are humbler which will no doubt help.

Hedge madness

Dave — Wed, 19 May 2010 11:37:32 +0000

This is clearly not the right market conditions for this EA. Stops are being hit all across my tests. I will ruminate and commence others tests in earnest.