1 Lac turns into 22 lac in 1 yr 2 mths 6 days

[techdude]

Hi Niludeepak,
This is an excellent thread and kudos to you for sharing your time and effort with the group.

I am basically an investor and recently got interested in the trading aspect. When I started with investing, I used really complex rules and lot of analysis on the fundamental side. I have never used technical analysis. Over the years I found that very simple rules work just as well (if not much better) than complicated rules. I made the rules so simple that I could decide within 2 minutes whether I would be interested in buying a stock or not (with no inputs of TA). I can definitely understand and appreciate the power of simplicity. My experience is that simple rules capture the essence behind a valid concept.

I would just like to point out that using 10% margin might be too much. I think that is WAY too much to risk in a position. I definitely would not be able to sleep at night with this kind of leverage. Black swan events might wipe one out. While a 10% fall in nifty in a single day is unlikely, it is far from improbable.

In fact it has happened more than once in the past. Take a look at nifty movement in Jan 2008. Specifically Jan 21 and Jan 22. Overnight nifty fell from 5700+ to below 5000. Nifty went from 6000 to 4500 in just three trading sessions. I remember that gazillion traders were wiped out that month.

I think any leverage of more than 3x is asking for trouble (unless it is hedged in some form). Trouble might not come for many many years, but eventually markets do something really really crazy. Why am I saying this? I am devising a nifty futures trading strategy for myself and my primary concern is about how to withstand such a fall and still be solvent and trading.

Thanks again for this thread.

Regards,
TechDude

 

[niludeepak]

i live (rather work) at a remote place in gujarat and i had telephone exchange failing my phone and net, so to my luck (i believe, and all sud believe that there's nothing like bad luck) i was away from the market today, and thus cud not communicate during market hours, posting after returning home

since i m a human being and full of mistakes, i sud not prescribe or rather publish what i m doing, because it disturbs people's mind in following a marvelous system

so i ll only post what the method signals and not what i do



our SL got triggered at open today 5238 spot - 5270 nifty fut, 5288 minifty

today's sell signal at 5230 spot, practically somewhere near 5250 in fut

 

[niludeepak]

Hi Niludeepak,
This is an excellent thread and kudos to you for sharing your time and effort with the group.

I am basically an investor and recently got interested in the trading aspect. When I started with investing, I used really complex rules and lot of analysis on the fundamental side. I have never used technical analysis. Over the years I found that very simple rules work just as well (if not much better) than complicated rules. I made the rules so simple that I could decide within 2 minutes whether I would be interested in buying a stock or not (with no inputs of TA). I can definitely understand and appreciate the power of simplicity. My experience is that simple rules capture the essence behind a valid concept.

I would just like to point out that using 10% margin might be too much. I think that is WAY too much to risk in a position. I definitely would not be able to sleep at night with this kind of leverage. Black swan events might wipe one out. While a 10% fall in nifty in a single day is unlikely, it is far from improbable.

In fact it has happened more than once in the past. Take a look at nifty movement in Jan 2008. Specifically Jan 21 and Jan 22. Overnight nifty fell from 5700+ to below 5000. Nifty went from 6000 to 4500 in just three trading sessions. I remember that gazillion traders were wiped out that month.

I think any leverage of more than 3x is asking for trouble (unless it is hedged in some form). Trouble might not come for many many years, but eventually markets do something really really crazy. Why am I saying this? I am devising a nifty futures trading strategy for myself and my primary concern is about how to withstand such a fall and still be solvent and trading.

Thanks again for this thread.

Regards,
TechDude

thanx, thanx, thanx !!!
this was the kind of comments/ suggestions i was expecting !!

 

[niludeepak]

Re: 1 Lac turns into 22 lac in 1 yr 2 mths 6 days!!!?!!!

-----------
Reply,

To, niludeepak,

My earlier post was to help you, not to criticizing you. U misunderstand!
I wanted to say that, in real life everything is changed depending upon the amount Risk attached with it, so making 1L to 28L in 14 months is impossible. :lol:

Your System has success rate of 59.5466 % (back tested) & So only 1 out of 6 trading condition (see the following) was satisfied. Rest still depends on your mind.


According to me (hc9001):-

Successful Trading consists of all of the followings:-

1. A back tested (with enough data) Technical System of 60%-70% Success Rate & confidence in that system.
2. Sound Fundamental Knowledge.
3. Money Management & Risk Management.
4. Trade Management including i) Partial Profit Booking, ii) Taking minimum loss, iii) Averaging loss in some cases.
5. Position size management (variable position according to Risk).
6. Psychology against emotion (greed & fear).

--------------

According to Famous Trading Psychologist Brett Steenbarger:-

Trading the financial markets is among the most challenging of human endeavors. At its best, trading is a celebration of the human mind's capacity to master complexity. Rarely does any single activity so reward individual initiative and the exercise of the reasoning mind. And yet, financial rewards are only part of the allure of trading. In mastering the
markets, we are called upon to exercise extraordinary self-mastery. Like any noble undertaking, such as art, science, or athletics, trading is a means of self-development, fostering the ability to act intentionally, in the service of one's training and ideals.

Source:-
http://brettsteenbarger.com/

From the above quote, it is easy to understand that, 'Successful Traders' have something more than a back tested indicator of 60-70% success rate.. That is their 'Mind'. :thumb:

Best Wishes to U [& those who would follow Ur Live Trading Calls here] Again. Cheers.

thank u for every thing u have given,
i have no complain whatsoever.

 

[niludeepak]

Many ppl told here that your strategy will not work,i taught atleast you should put a honest effort, and then what ever the results come so be it, but you already started taking arbitrary decisions deviating from strategy. This strategy could still work reasonably in a disciplined traders hands but in your hands it wont work.

i'll take care.
pl. find time in future also to shower ur suggestions/comments
thanx

 

[THETRADER]

Pretty good work. Some interesting results :

There are 9 consecutive loss trades, that also twice. With 3 points / trade as commissions, the equity drops to Rs.12,79,401.

Entry at the beginning of consecutive loss trades checked, still remains in profit!

Profit Trades 34
Loss Trades 77
Total Trades 111
Strike Rate 31%

In Points
Profit Points 5,684.85
Loss Points -3,031.75

Av Pr Points 167.20
Av Loss Points -39.37
Reward/Risk 4.25

Entry at the beginning of consecutive loss trades checked, still remains in profit! It is basically that the Reward/Risk ratio of 4.25 (unbelievably high!) with money management more than compensates for a poor strike rate of just 31% profit trades.

Just for info, for the purpose of the strike rate, reward/risk ratio, etc., commissions have not been taken into account.

Wish you all the best!

 

[niludeepak]

Pretty good work. Some interesting results :

There are 9 consecutive loss trades, that also twice. With 3 points / trade as commissions, the equity drops to Rs.12,79,401.

Entry at the beginning of consecutive loss trades checked, still remains in profit!

Profit Trades 34
Loss Trades 77
Total Trades 111
Strike Rate 31%

In Points
Profit Points 5,684.85
Loss Points -3,031.75

Av Pr Points 167.20
Av Loss Points -39.37
Reward/Risk 4.25

Entry at the beginning of consecutive loss trades checked, still remains in profit! It is basically that the Reward/Risk ratio of 4.25 (unbelievably high!) with money management more than compensates for a poor strike rate of just 31% profit trades.

Just for info, for the purpose of the strike rate, reward/risk ratio, etc., commissions have not been taken into account.

Wish you all the best!

--------------------------------------------------------
यूनान-ओ-मिस्र-ओ-रोमा सब मिट गए जहाँ से
अब तक मगर है बाक़ी नाम-ओ-निशान हमारा

कुछ बात है कि हस्ती मिटती नहीं हमारी
सदियों रहा है दुश्मन दौर-ए-ज़माँ हमारा

THIS IS A PRAISE FOR OUR COUNTRY
----------------------------------------------------
main to nahak hi maje loot raha hun

aap jaise kuch mil jate hame, main to abhi baccha hun

bas abhi abhi chalna seekha hai.

thanx buddy, pahli baar kisi ne test kar ke bataya hai

sir( if u don't mind calling u sir ), i have very less of data with me and haven't tested it as throughly as cud be , pl. take out some time to grind the system thoroughly, also look into my other system.pl. sirji.

 

[niludeepak]

yesterday at close sold at 5230 spot, 35 points sl = 5265 spot
our SL goes

will have a buy signal at eod if it closes above 8ema
will have a sell signal at eod if it closes below 8ema (5275 spot),
y'day's 8ema works well so we will follow that

 

[gkpc]

Hi Niludeepak, Please take what I am posting in a positive way!! I dont wish to undrmine your efforts or your strategy!! Writing this after having discussed with a few others here on the forum.

The most attractive part of your Thread is its "title" that attracts most os us here!!
I tried to use the same logic with a few other Strategies here on the Forum and quiet a few beat your Profit figure hands down "if the profits are ploughed back" to enhance the exposure'!

These strategies look excellent on paper when we see the outcome on paper but really difficult to trade even for the most expirienced trader.

I am sure the diligence with which you have compiled the data shows your confidence on the strategy!! What would you suggest to make it easier to trade!
Without looking at the detailed result a few things come to mind :
01. Would it be prudent to exit positions gradually.. more so when the traded quantity has gone beyond a per determined threshhold! Say 20% at 35 points another 20% at 70 and 20% more at 100 points and balance we carry till 200 or reversal!!
02. Maybe we add positions partly only... instead of ploughing in entire profits, say we add only 50% of the profits to increase trade size and remove 50% from table.
Only an analysis may say how this will work out... but would surely make the strategy more tradeable... the profit that you got in 1 year maybe we get it in 18 or 24 months.. but would probably be more gettable!!

 

[gkpc]

Hi Niludeepak, Please take what I am posting in a positive way!! I dont wish to undrmine your efforts or your strategy!! Writing this after having discussed with a few others here on the forum.

The most attractive part of your Thread is its "title" that attracts most os us here!!
I tried to use the same logic with a few other Strategies here on the Forum and quiet a few beat your Profit figure hands down "if the profits are ploughed back" to enhance the exposure'!

These strategies look excellent on paper when we see the outcome on paper but really difficult to trade even for the most expirienced trader.

I am sure the diligence with which you have compiled the data shows your confidence on the strategy!! What would you suggest to make it easier to trade!
Without looking at the detailed result a few things come to mind :
01. Would it be prudent to exit positions gradually.. more so when the traded quantity has gone beyond a per determined threshhold! Say 20% at 35 points another 20% at 70 and 20% more at 100 points and balance we carry till 200 or reversal!!
02. Maybe we add positions partly only... instead of ploughing in entire profits, say we add only 50% of the profits to increase trade size and remove 50% from table.
Only an analysis may say how this will work out... but would surely make the strategy more tradeable... the profit that you got in 1 year maybe we get it in 18 or 24 months.. but would probably be more gettable!!

I posted an excel sheet here :
http://www.traderji.com/advanced-tr...e-identify-duplicate-strategy.html#post702030
I tired to find the results if we ploughed back the profits to add positions and found that 1 lakh became 5+ lakh from 1st June to June end 2012!
Add was done gradually and not after every profit.
I dont know the strategy, not mine, but I am trying to focus on the BIG profits we may perceive if we calculate them on adding more and more positions!! So it all boils down to RR and money managemen with discipline!!
All the very best!
-Gautam