Lifespan of a Strategy

[Simon]

Hi Traders,

Just curious..

My understanding is that strategies can be fairly “disposable”, as we have the tools to generate new ones relatively easily. If one is performing poorly, we just replace it.

However, I wonder if many of you have any strategies that you’ve had for a long time, say six months or a year, or longer, that keep performing well?

Are that any particular attributes to these strategies? Any particular criteria?

Cheers!

[Petko Aleksandrov]

Hey Simon,

That is quite an interesting topic here from your side.

There are indeed strategies that last for longer, and it is a good point if we can point out something in common between them.

I remember I had a 1:1 class with one of our traders, I think it was Roman, and he shared that one of the Bitcoin EAs that I shared last September 2018, was still profitable. It would be great if he shares what happened with that EA 🙂

 

[Thapelo]

Hello Simon,

I had a look at my EAs that are a long time on the live account, but to be honest with you, I can not find anything in common. But it is something to look for. Good point!

[dkoh]

Hi Simon, thank you for asking, I have the same question as well.

In fact, with the EAs, I made around 10% from April-July’19, and from Aug-Nov, it went -15%.

I have removed strategies with low profit factor and swapped with newly generated strategies (timeline 2014-2019).

Still doesn’t seem to be improving.

Wondering if anyone has had a bumpy Aug-Nov (likely Dec)?

How did you manage to get out of it?

[Petko Aleksandrov]

Hello Dkoh,

which currency pairs did you trade, on what time frame?

Give us a little bit more details.

Cheers,

[dkoh]

Hi Petko,

I am doing the following:

AUDCHF
EURAUD
NZDUSD
EURUSD
CHFJPY
USDCHF
AUDUSD
EURJPY
USDCAD
AUDJPY

M15 and M30 for all the above pairs.

Was doing GBPUSD and EURGBP but realised that it is too dependent on brexit-related news.

Can you advise what currencies is more suitable for short timeframe?
Perhaps the more volatile ones like EURUSD, USDJPY and such?

[Roman]

Good afternoon Petco,

Sorry for the delayed response. Have been super busy trying to get ready for 2020! But yes I have one of your strategies from the “Forex Trading Course: 12 Forex Robots every month”. Your EA magic number is 82478347 for EURUSD. It’s been on my account since September 2018. Has made 106 trades, and maintains a 1.5 profit factor with 44% win rate (depending on market cycle). I call it “the studmuffin” and have used this strategy as the building block for mine since 🙂

@Simon- I’ve spent a lot of time trying to determine “shelf life” this year because the point you made is very important. What I’ve found is that mine are lasting about 1 full year on H1 time frame. I was using 20% out of sample with a total of 14 years worth of data, and incubating for around 3-6 months before putting live to let the stats stabilize. This has given me between 6-9 months milking them live. Right now i’m experimenting with walk forward to see how long i can get out of them. Just started using it about 2 months ago so don’t really have enough data to make a recommendation.

What i will suggest is that you figure out a tap out point of your own. I’m pretty patient and willing to give a strategy time to work itself out or show me that it’s truly expired. I think Jacpin throws them out if they’ve lost their 70% win rate if i remember correct. From my research this means bigger stop loses than i’m personally not comfortable with. Only you can decide when its time to trash it. Another thing i’ve noticed over this past year, is that when you place the algo on demo/live plays a huge part in it’s performance at that time. I created a strat towards the end of 2018 and put it live, it failed miserably. When i bought my new PC in March i found that strat and gave it another go, it’s now one of my top performers in EURUSD. It wasn’t in tune with the market not because of it’s parameters, but due to the time i placed it on the accounts.

Hope this helps! Happy Holidays Familia!!

[Petko Aleksandrov]

Hello Roman,

Glad to hear back from you. I am super glad that my strategy brought to you positive results and that it helped you build your own strategies.

It is a hard way to go, and the thing is that many people give up easily. Keep up the good work, and keep in touch.

Happy holidays ahead!

[Roman]

Good morning Petko,

Thank you my good sir! Appreciate all we’ve been able to learn from you. Yes people give up because of no instant results. I remember when i joined you at the beginning of 2018, and I gave up for months before getting back to work around September of 2018. Again when you place the EA’s on the account makes a difference, flooding the asset is key to finding the strategies that are in tune with current market circumstances. It’s taken me this past year of consistent trial and error to figure out the kind of strategies i like and to see roughly how long they’ll last me. Most important thing is to figure out your own parameters for finding and retaining profitable strategies.

Keep up YOUR good work Petko, Warm Regards and Happy Holidays!

[dkoh]

Hi Roman,

Just wondering what do you mean by flooding the asset?

Are you still having good returns these past few months?

My sentiments is similar that the right timing of placing the EA live is important. Those that I placed in Apr/May are still +ve returns but those in Sep/Oct is doing very badly.

What assets are you trading by the way?

[Roman]

Good afternoon Dkoh,

By flooding i mean generating a lot of strategies for the assets you trade in order to have more opportunity for good strategies to float up to the top. I’ve been very lazy since August when I blew my account over leveraging for a partnership i was shooting for. So right now i’m mainly focused on getting back into GBPJPY EURUSD USDJPY EURGBP and AUDUSD. Just took Petko’s gold coarse so i’m trying to get a good feel for my style of strategies for Gold, would like to trade WTI and Indexes as well but right now i’m strictly forex as my go to. But yes the last round of strategies i put into incubation in October will be ready for 2020 trading 🙂

[Petko Aleksandrov]

Hey Roman,

It makes me very happy to hear that my work helped you during the time, and it sounds like you made the most important conclusions.

I tell those in most of my courses but the important is to go through it by yourself.

For example, it is important to find out your own parameters, ranges for the generator, acceptance criteria and all that will form your usage of the generator.

After that is the moment of managing the account. And that is why I do not give exact rules to follow the account, but again it should be own method that makes one comfortable trading the EAs.

Happy holidays to you as well and keep me updated with your trading!

Kind regards,

Petko A

[Roman]

Merry Christmas Petko and my Fellow Traders,

Yes best advise is the one you give to yourself after falling flat on your face trying something. Managing the account after going live is certainly the most stressful part of the learning curve. Very easy to get excited about strategies just to watch them fall from the sky. But you give a lot of good suggestions for us to experiment with to find our style. Will definitely keep you up to date. I’m definitely trying to be more consistent and active. Appreciate you as always!

[Petko Aleksandrov]

Thanks, Roman! I appreciate your words!

Happy Holidays, and keep up the good work during 2020!

Kind regards,

Petko A

[Author]

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