Many seem to have misunderstood this.
If you have a well backtested system, chances are it will continue to work for a long time.
For beginners though, starting to trade your system when your system is in a drawdown helps maximise the probability of wins nearby.
If you have a well backtested system, chances are it will continue to work for a long time.
For beginners though, starting to trade your system when your system is in a drawdown helps maximise the probability of wins nearby.
https://twitter.com/theBuoyantMan/status/1373184581067677696
That said, you don't really have to WAIT for that drawdown to happen to start trading your system.
You can keep trading the system in forward testing phase where you are trading fixed lot size, very conservatively.
You can use drawdown period to start aggressive compounding.
You can keep trading the system in forward testing phase where you are trading fixed lot size, very conservatively.
You can use drawdown period to start aggressive compounding.
And that's also why I said that once you start trading a system, you can't stop taking trades.
That's where you can't time - once you start, you have to take all the trades, and shouldn't try and time the system's drawdowns and equity highs.
That's where you can't time - once you start, you have to take all the trades, and shouldn't try and time the system's drawdowns and equity highs.
This is to be tried only before you begin trading your system aggressively, to maximise the probability of a win once you start.
If you miss 5 winning trades, you'll feel like you have missed out, but it won't be that much since you'll still be trading conservatively.
If you miss 5 winning trades, you'll feel like you have missed out, but it won't be that much since you'll still be trading conservatively.
But remember one thing.
The pleasure of making 1 crore is nowhere relatively equal to the pain of losing 1 crore.
Replace 1 crore with 10k, 1L, 10L, 50L - anything. At your level, losses are more painful than profits are pleasurable.
The pleasure of making 1 crore is nowhere relatively equal to the pain of losing 1 crore.
Replace 1 crore with 10k, 1L, 10L, 50L - anything. At your level, losses are more painful than profits are pleasurable.
Doing this, ensures that you can best avoid that pain because such pain skews your behavior and many beginners make the mistake of deviating from the system or creeping discretion inside.
Seasoned pros can avoid this, but not beginners. So, keep that in mind.
Seasoned pros can avoid this, but not beginners. So, keep that in mind.
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