Initial Results Are Promising!


Finally a new post…I know right?

So in our last episode, I had just come up with a new set of entry criteria for my FOREX trading account. Since that time, I’ve taken a total of 12 trades, nine of which are closed, one of which is open but with a locked-in profit of at least 1R (that’s one times initial risk), and two of which are still open with a risk of loss.

Here’s the summary of those trades, with profit or loss in terms of initial risk:

Position Pair Profit (xR)
Long USD/CAD 1.57
Short AUD/NZD -0.22
Short GBP/AUD 0.89
Short EUR/JPY 1.14
Short USD/ZAR -0.37
Short GBP/NZD -0.93
Short USD/INR -0.18
Long USD/CHF OPEN >= 1.00
Short AUD/CAD 0.18
Long EUR/JPY -0.29

Using just the nine closed trades and the trade with a locked in profit (assuming it ends with just 1R profit), let’s calculate the expectancy of this. ¬†Yes, yes, I know this is much too small a dataset, and that’s why I’m just calling these the initial results. So anyway, what have we?

We have five wins and five losses for a win percentage of 50%. The average win is 0.95R and the average loss is 0.40R. So our expectancy is:

0.5(0.95)-0.5(0.40) = 27.5%


In fact, I struggled a bit with position sizing (I’ll discuss that in a future post), and luckily the open long USD/CHF trade had a very high initial risk, as did several of the other trades. The upshot of this was that the account had an actual open profit of 60% for the first seven weeks of the year.

Wow again!

Unfortunately, I’m not making much at my actual job, so I’ve had to take about half the profits out thus far for living expenses. Boo!

So I’ll post more in future about the entry criteria and the research I did, as well as the nuts and bolts details of the trading method. Until then, stay tuned, and keep pipping up!

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