People are struggling in trading because of a combination of factors:
They want to win all the time, but every strategy will have its bad period, there will be a period where consecutive losses will happen, and if people are not familiar with the strategy - for example, if they don't develop it themselves, they just got it from someone else, never back-tested it properly - then when a bad period comes, 99% of the people will start losing faith and look for another strategy, another holy grail.
Whenever I have friends who are newbies, asking me for winning strategies, I always give them one strategy (just to test their EQ) with the following stats:
- winning percentage around 46-55%
- Each win is 2R (i.e. if you risk 1% of your account, you will gain +2% of your account on each win)
but...
- it may have have 15 maximum consecutive losses (from backtesting 10 years of data)
but
- it will also have 10-15 consecutive winners.
Over a one year period, it can return 100% easily on EURUSD and GBPUSD (just two pairs).
and NONE of these 'friends' are able to execute this strategy despite it's proven track-record. They all gave up after suffering 6 to 8 consecutive losses. I told them, if they risk 1% of their account, a drawdown of 6% to 8% is nothing to worry about. But this is human nature, losing demoralizes people.
QUOTE(cmk96 @ Oct 24 2020, 04:59 PM)
Dec 10 2020, 03:20 AM

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