Note: Of course I do not advocate this MM for all your capital. This is a extremely high risk, its nothing more than a side project. It's a bonus, for if you ending up being a better trader than you think you are, then this will work for you.
The reason I am posting this is because, there may be others out there who haven't thought of this either.
Take it or leave it. But winning 3 trades in a row with a 1:1 RR, is not particularly difficult
(in my opinion)
I think we've all heard the story of the trucker who rolled into Vegas with $100 and parlayed it on Blackjack hands until he had over $100,000.
The fact of the matter is, from a statistical standpoint, this is nearly impossible to do. Especially when the edge for a non card counting Blackjack player that plays each hand perfectly (to gain the best edge), he still ends up with only a 48% win ratio.
But with trading, it is a completely different story.
Trading is 0% luck, 20% skill, 40% psychology, and 40% patience.
Gambling via casino games is 95% luck, 5% skill, 0% everything else.
This is the difference.
Take whatever you would normally risk on 1 trade, (for me that is 0.5%), just so you don't feel like this is some big deal. Because its really not.
Say that risk is $100.
Here's how it goes.
The reason I am posting this is because, there may be others out there who haven't thought of this either.
Take it or leave it. But winning 3 trades in a row with a 1:1 RR, is not particularly difficult
(in my opinion)
I think we've all heard the story of the trucker who rolled into Vegas with $100 and parlayed it on Blackjack hands until he had over $100,000.
The fact of the matter is, from a statistical standpoint, this is nearly impossible to do. Especially when the edge for a non card counting Blackjack player that plays each hand perfectly (to gain the best edge), he still ends up with only a 48% win ratio.
But with trading, it is a completely different story.
Trading is 0% luck, 20% skill, 40% psychology, and 40% patience.
Gambling via casino games is 95% luck, 5% skill, 0% everything else.
This is the difference.
Take whatever you would normally risk on 1 trade, (for me that is 0.5%), just so you don't feel like this is some big deal. Because its really not.
Say that risk is $100.
Here's how it goes.
- Start balance $100
- You win trade 1 = $200 balance
- You win trade 2 = $400 balance
- You win trade 3 = $800 balance
- Now if you continued this to 6 wins in a row, you would be up to $6400, 7 in a row is $12800... etc
- As you win more in a row, your chance of losing is increased. Psychologically it is hard to risk all profits on one trade.
- So here is the mindblowing variation I added to it that.
- After 3 winners in a row, pull out half the balance.
- 3 wins in a row, really is not difficult to do.
- After a loss, withdraw $100 or 10% of profits whichever happens to be greater (if $2000 is in savings, then we start with $200 this time, if $1500 in savings we start with $150..) By doing this you guarantee yourself many chances to keep trying, to get that big winning streak (5+ gives you very nice profits considering what you started with)
Example scenario:
Start balance = $100
Trade 1 = $200
Trade 2 = $400
Trade 3 = $800
Deposit to savings = $400
Savings total = $400
Trade 4 = LOSS of $400 -- streak over
Withdraw from savings = $100
Savings total = $300
New trade streak, start bal = $100
Trade 1 = $200
Trade 2 = $400
Trade 3 = $800
Deposit to savings = $400
Savings total = $700
Trade 4 = $800
Trade 5 = $1600
Trade 6 = $3200
Deposit to savings = $1600
Savings total = $2300
Trade 7 = $3200
Trade 8 = $6400
Trade 9 = $12800
Deposit to savings = $6400
Savings total = $8000
- I am a firm believer that most professional traders do this as a side project (what other reason would there need be for offering such high leverage, other than a trader not wanting to keep much capital in the broker bank, which is smart) There is absolutely no downside to doing it. The risk/reward is phenomenal.
- This my friends, is the true reason the CFTC does not allow U.S. retail brokers to offer leverage of greater than 50:1 (okay im kidding but it probably doesnt help). If you insist on trading with a U.S. broker even though there is no law forcing you to do so, then if you want to risk 100% of account you will need a 200 pip stop loss and 200 pip TP. However if you risk just 50% of the account, with a stop loss of 100 and take profit of 200, you can still double your account every trade.
Variation
- With 1:2 RR and risking 50% to make 100% (instead of risking 100% to make 100%), after 1 winner, you have immediate peace of mind. You know a loss will only move you back to BE.
Be hopeful in a winning position, and fearful in a losing position.