How can I choose the best Futures trading strategies?
There are many successful Futures trading strategies. Among them, no strategy is demonstrably best. There are also strong mathematical reasons why they prefer several Futures trading strategies at the same time. Although the merchant's bank role is not large enough to trade from 12 to 20 different futures using two or three systems on each, it can find that different Futures classes need different Futures trading strategies. If the trader has a small share, such as $ 25,000, success can be problematic at the end of the day. The use of a mechanical system can further reduce its chances. If the trader has enough money to support his household for one year, when trading, daily trading with $ 25,000 can be developed.
The trader must consider his own personality. If he needs to know how to decide on trading, the Off-the-Shalf system is unlikely to work for him. Typiccalls are what knows like systems “BLACK BOX ", which means that algorithms of decision-making are unpublished. If he has attention or decision-making problems, access with the recognition of the pattern with the judgment-discretion system-is probably not in combination with the daily trade.
If the preference of the Futures business strategies is the first thing to do is to use back testing strategies to ensure that the system is profitable. The disciple trader must hire someone to train or train him. While backward testing is not something that the discretion system can do, get a lot of practice is something the trader can and should do.
When evaluating Futures trading strategies, the trader will have to look at the marginalized trader and how much the biggest loss is. The data that the merchant must generate is: Percentage victory (%W), average victory (AVGW), average loss (AVGL) and the largestloss. The "Edge" trader equals %w*avgw- (1- %w)*avgl. This equation is known as "mathematical expectations".
If the trader's edge is negative or very small, trading will not work in this way. The average monthly income of the trader will be the number of trades per month multiplied by its edge. Again, the amount of business capital will be important again: a daily trader of $ 10 per trade in three stores per day will be only 600 USD 600 per month if trading with one contract. If he can afford to trade 10 contracts, his average profit is $ 6,000 per month, in many cities to support him.
When choosing the best Futures trading strategies, the trader must consider his bankroll and his personality, as well as whether the system earns money. There is no point in buying a system that would achieve a huge profit if someone lacks capital for its implementation. Few people can change their personality so that the system system; A trading system that requiresQuick decisions will not work for a trader whose decision -making process is very methodical and thorough. The systems are cheap; Business capital is expensive. If the system does not work, throw it away and start fresh.