February 1, 2019 at 18:17 #8980
I’m still generating strategies but was wondering how I can manage risk in my live trade account when I finally start trading.
How many experts and lot sizes do we all trade?
I plan to trade 6 currency pairs, on 2 time frames with a starting balance of 2500GBP. Max leverage is 1:30.
I know that lot size depends on both the account risk and trade risk. But I’m not sure how the lots sizes of individual EAs will add up. Especially if I have 10 strategies trading on each time frame for each currency pair.
I’m careful not to risk too much at the same time.February 1, 2019 at 21:39 #8984jacpin2002Participant
@Ossaio-Hi there! I think I saw a post from Petko on the forum with a suggestion on lot size for trading with a bunch of EAs. Numbers are based on a 1000USD account (Forex only):
Number of EAs: 1-10
Trading Lot size: 0.1
Number of EAs: 10+
Trading lot size: 0.01
Now because I trade more than just forex, my lot size changes depending on the asset. Here is what I have in my live account, when I started at 1000USD 1:100 account leverage:
Forex EAs: 0.1 lot size
Cryptocurrency EAs: 1 standard lot size (Bitcoing and Ethereum) 10 lots for Ripple
Commodities EAs: 0.01 lot size
I’m going to keep my lot sizes like this until I see a need to change. Also, I’m a US trader and we have to abide by FIFO rules. I trade 2 EAs for ever asset on 2 timeframes. Each EA has to have a different lot size in order for me to stay in compliance with FIFO. So for Forex, one EA is trading at 0.1 and the other is trading at 0.11.
Hope this helps.February 1, 2019 at 22:03 #8985
Thanks for the detailed answer Jacpin.
Using the example you gave, assuming you trade EURUSD and USDCAD on 2 time frames with the 2 EAs.
Let’s assume all EAs open a trade on each time frame at the same time for both pairs. Does it mean you have 0.1+0.11 lots opened for EURUSD and 0.1+0.11 lots opened for USDCAD. This will give a total of 0.42 lots opened for all Forex EAs at that particular time.
Am I correct with my reasoning? Thanks.February 2, 2019 at 0:14 #8989jacpin2002Participant
@Ossaio-Yes, that’s correct. Another example is this: I am trading EURUSD and USDCAD on both the M15 and H1 charts. I have 2 EAs for each chart for a total possible amount of 8 trades happening at the same time. Here is how my lot size is setup:
I would then repeat this same setup for USDCAD. I tend to have the best performing EA with the highest lot size.February 2, 2019 at 0:28 #8990
Thank you Jacpin. You’ve cleared this up for me. From what I understood, if I have a leverage of 1:30 with a £2500 balance, it means that the maximum lot size I can trade at any given time is 0.75 lots. So, I need distribute this (0.75) among all my EAs, time frames and currency pairs.February 2, 2019 at 10:21 #8995
the examples of Jacpin are great and clear, but one more time this is because she is from US. If you are not from US, you can keep it same lots as 0.1 or 0.01 which will make it easier for you.February 2, 2019 at 13:45 #9002
Good point. Thanks Petko.February 2, 2019 at 19:38 #9039
And regarding the money management, it is important to keep strict rules, so this way you will avoid emotions as trading with higher lots after successful period.February 2, 2019 at 22:02 #9045
I agree. I’ll start with conservative lot size and increase it only after I’ve had much experience.February 4, 2019 at 11:00 #9065
if you are really fully beginner, I would suggest you to start with Demo account. But the best way to practice trading is on live account with 0.01 lot.
But take your time, and do not hurry. Practice, and you will feel when you are ready to trade real money. With everyone is different, it could take you a month, it could take you a year. Depends on many things – how much time you spend on it, how strict you are with your rules, and most of all how much you really want to do it 🙂February 4, 2019 at 14:31 #9082
You are absolutely correct. I’m really taking my time. I want to make sure I get it right as much as posible. I have purchased a VPS where I’m collecting data on both MT4 and MT5 live accounts for about 1 month now. I noticed that MT5 accounts have more historical data than MT4 accounts. So, I now have more than enough broker MT5 data for strategy generation.
I’m using two approaches for strategy generation. 1) Allow FSB to automatically generate strategies. 2) Supply FSB with some fixed manual trading opening logic and then allow it to suggest exit conditions.
I’m looking at currency correlation also. I want to make sure the currency pairs I trade are either non-correlated or negatively correlated. I’m also looking at pairs which trend most of the time.
With my data analysis background, I’m trying to segment the historical data into different combinations of market conditions to see if the results will be improved. I currently spend 8 to 10 hours per day on this, outside my full time job hours.
I also have a 32GB RAM workstation which will be generating strategies while I’m at work. I’m committed to making this work and hope it does. I really appreciate your great efforts and also the help of all the members of this forum who have been selflessly sharing their experiences.February 5, 2019 at 10:52 #9222
Glad to hear you are so dedicated to the algorithmic trading. I am sure you will find your exact style and path in algorithmic trading.
Normally the Historical data on the broker is from the broker itself not from being on MT4 or MT5. Keep in mind as well that most of the brokers do not allow hedging with MT5. That is why I normally teach and demonstrate MT4.
It is great you have a powerful workstation. You will be able to generate strategies quickly which will make the whole process fast with you.
And take it easy with the hours you spend 🙂 It took me years to find the maximum I can stand in front of the monitors. Normally if you do it as much as possible, you will exhaust yourself, and after a few days, you would be able to work effectively.
So just spend a lot of time, but find enough time to rest. It is quite important.February 5, 2019 at 22:37 #9261
Thanks for the kind words Petko. Fortunately, Pepperstone allows hedging on MT5. I agree I need to take more rest. From few strategies I generated so far, I can see this is more of a marathon rather than sprint. So, I’ll go easy, keep learning and gradually work towards becoming a better trader.February 6, 2019 at 18:05 #9386
Good to hear that, Ossaio! Wish you safe trading! Do not hesitate to drop any more questions.
Cheers,February 6, 2019 at 20:48 #9402
How do you modify the lot sizes of the EAs after strategy generation? Let’s assume you generated a strategy using 0.02 entry lot, 0.04 max lot, add 0.01 lot and reverse 0.04 lot. If the EAs are doing well in demo or live trading, what do you do? Increase the lot size in MT4 or FSB?
I’m asking this because I generated some strategies with good equity lines using a particular set of lot sizes. Then I started experimenting with different lot sizes after generation to see if the net balance will increase with increasing lot size. However, I was surprised to discover that increasing the entry, max, add and reverse lot sizes made the strategy become unprofitable.
Have you experienced something like this?
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