danasa replies to: Risk Management

I did make a few more twist to this file, and oh, i want people to improve this file with multiple variations and realistic inventions. See I know you have been brainwashed enough by what you have been reading, universal wisdom, right, of 1-2% per trade. Here, let’s empty our cups of what we know and see if this works!

I have started implementing this in my demo trades, it seem to work, I am currently using 5% per trade of demo account of $3,000. About 4 trades running, the very first was a loss, these running 4 are all in profits, still far off targets, I love high xR trades, some of them here are 5R targets with trailing.

PLEASE I NEED CAPABLE PEOPLE TO COME AND TAKE THIS SPREADSHEET AND WORK ON IT, WITH REALISTIC IMPROVEMENTS. IF YOU KNOW SOMEONE THAT IS THAT GOOD INVITE HIM/HER HERE, YOU WILL BENEFIT. THIS MIGHT BE THE MISSING LINK TO YOUR ACCOUNT’S EXPONENTIAL GROWTH!

……STARTED A READ ME, FAR FROM COMPLETE….

README.TXT
RISK MANAGEMENT CALCULATOR SPREADSHEET
RRR – Risk Reward Ration, from now on, I will be using R for reward size, say RRR of Risk 1:2 Reward, i will say 2R.
RISK % PER TRADE – the percentage of capital you want to risk per trade
DEPOSIT CAPITAL – the initial amount of cash you deposited on opening account, we believe you will never have to deposit another, you are here to exponentially grow that amount.
RRR1- This is half the total of position RISK % PER TRADE amount. 0R or 2.2R – Either loss, 0R or half position hits target at 2.2R. This is to quickly get out of risk. At half position hitting target of 2.2R, the other half is risk-free ride. Preservation of capital is our priority. Why 2.2 not 2? 0.2R to take care of swap charges and/or commissions.
RRR2- 0R or xR to Yr; Trail Stop – hoping you ride with your trailing stop style till stop gets hit. Or modify the excel to fill a fixed Target R
TRADE RATE(ESTIMATED) – This depends on your time frame, I use multiple time frames for my trading, Long-term is W1, intermmediate or i prever to call mid-term is D1 and Short-term is H4. This has to do with your trading system not with this risk calculator.
RRR TP1 Mod; Enable? – YES or NO – For every 10 trades the x1 and x6 is set to zero(Loss) to greatly lower win rate and insert minimum of 2 loses per 10 trades. NOTE; Enabling it YES implicitly set/overrides ‘Maximum Allowable Straight Wins’ to maximum of 4 straight win trades

IMPROVEMENT/SUGGESTIONS:
1. Maximum Allowable Straight Wins – Do not allow more than x numbers of straight wins; if last previous win run is x number, then force loss on the current trade. if you do not want to control this, set the value to Zero – 0. Clue, i guess, is to use the “TP1 WIN COUNT” column and function – SUM(), hmm.
2. WITHDRAWALS; No one will be a full-time professional trader and live off free air, you need cash for your upkeep, so we should implement withdrawals
3. SIMULTANEOUS TRADE; We should take into account, of course randomly, between certain number of trades say 1 – 8 concurrent trades we may be in at a time due to some trades needs days, even weeks, or 2 months to score you that Target profit.

FORMULAE EXPLANATIONS
The Win/Loss Randoming:
CHOOSE(RANDBETWEEN(1,3),$C$5,RANDBETWEEN($D$5,$E$5-1),RANDBETWEEN($D$5,$E$5))
Breakdown:
CHOOSE(RANDBETWEEN(1,3)… – meaning pick 1 or the following 3 items per randomized session. But note this has upped the chances of wins since two of the three variables is a win. I believe you need atlease >=40% expectancy from your strategy to be in good shape.
$C$5 – fixed 0 aka loss as 1st variable to pick
RANDBETWEEN($D$5,$E$5-1) – 2nd variable, chance of win between the lower bound and upper bound reward, but less the upper bound by 1 so it never gets hit in this case, this will greatly reduce final Gain Amount from looking astronomically unrealistic
RANDBETWEEN($D$5,$E$5 – 3rd variable, same as above but this time give the upper bound value a chance
OBSERVATIONS;
1. I certainly think 5-10% risked per trade is very achieveable, now this will depend on your trading edge! Are you a machine gunner or a sniper! I am a swing trader, mostly on Daily Charts and have a particular setup only one that trades off Weekly chart, I rarely take setups of H4. I am a sniper trader, so i think to ramp risk up to 5-10% with decent RRR of greater than or equal to 3R is good for me!
2. TP1; I dropped the defensive TP1, TP2 template where you have two target profit, TP1 @ 1.25R, then Trail TP2. I worked the maths with observations, I realized the option of defence of TP1 is cutting the potential exponential growth of this Moneny Management on Steroids thing…Take that whole loss if you have to, but when you win say 3R, you are whole and golden! Try and tell me too.
3. I realized the more cash you have as startup capital the more your chances of not running aground. Sometimes, drawdown as bad as 60% means nothing when your trading edge start to shine consistently.
4. Emotions; you need nerves of steel to follow this thru you target trade count, I was looking at say 50 trades, then bank have of capital, then restart the madness!

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