I started building my strategy, over a 100 trades I would only win between 30-40 of them, with loosing streaks of about 7-10. At the end of the 100 trades, I was making a profit of about 30% of my account size. I was completly perplexed, how could it be? Risk management and position sizing... I still couldn't believe it, but this video reasured me I'm on the right path! Thank you so much.
Basically what he means is when you win, win big and when you lose, you should lose less. I always thought I was a decent trader but my trading r:r was 1:2 which later I realized was not good at all. I learned the hard way is that I’d rather have 1 trade that’s 5:1 than have 20 trades that’s 1:1 or 1:2. Always risk less and have huge returns so even when you’re wrong you can cover all your losses :)
This video hits home. I'm a relatively new trader (about 6 months) and for about 5 months I was overly stressing my win rate. Recently I have come to realize that my win rate does not matter as much if my strategy minimizes loses while having a high reward to risk ratio
@@Duomoinitiative The truth is that you learn more from your own experiences than any experience someone else tells you about. So yes, traders need to go through the many mistakes past and future traders have gone through and will go through in order to get to the next level
Regarding Winrate, it's irrelevant unless coupled with your avg. win % and avg. loss %. I have an 87.5% winrate, which by itself is meaningless; my avg. win is 83%, avg. loss 45%. Combined with win/loss amounts Winrate is very informative.
What was your experience this week? I've had plenty of lessons learned the hard way. As long as we learn from them, they can only make us better in the long run!
@@Duomoinitiative I have been the trader who won't accept losses for a long time now. Over 12 months of testing my strategy on a demo then went live in February this year. My balance was huge and I was keeping my equity above my starting point for the whole time just waiting for that big reversal in the market but in my own panic I placed some stupid hedging trades in the opposite direction again only to find myself feeling trapped. Man, I had balls of steel to having no balls at all. I panicked, not knowing what to do. All buy orders, no sell orders when gold was at the bottom a few days ago and not wanting to be caught with more sell orders at the bottom I decided enough is enough, too much risk and stressing about what would happen when I went to sleep I closed everything before I chewed up my capital. Well, the last few days proved to make that a stupid move because the market turned back to the upside! Oh bugger, I'd be back in the black again but who was to know... Certainly not me! Fortunately, despite taking a 25% hit to my initial capital and a loss of 9 months work and profit I'm still here and listening to a great mate (Phil) who also follows your channel and people like yourself I finally feel that I am arming myself with the tools to be able to sleep at night and refine a more relaxed strategy. Reality is my tested strategy was and would work but there is just too much risk to live with. Thanks Nicholas for the great videos. You are a really smart, funny guy and people like yourself prove to me there are better ways than mine to do this. I'm just lucky I got out alive and to be able to trade another day.
Best trading channel in my opinion, just fully understanding the concepts and exploring the genuine strategies this channel provides I have become a profitable trader
I remember braging about my accuracy so much I held on to a winning trade until it turns into a loss. The trade eventually worked out. However, i knew I should have cut the trade in profit and reenter on the next Oppertunity.
🔹 Get FREE access to the Duomo Trader Development Program: duomotrading.com/FreeDuomoTraining 🔹 Add us on Instagram: instagram.com/duomoinitiative/ 🔹 Our second channel for financial news and analysis: th-cam.com/users/MarketMoversFinancialNewsandAnalysis
WOW ... we never need to meet, you already know me. Over trading, hi winning trade percentage above the 85% mark - what loss aversion, I have only blown up my account "a lot". Gotta say, really happy to have watched this video to know I'm not alone, even more happy to have completed the free online course and am halfway through the paid course. NO MORE LISTENING TO THIEVING BROKERS AND BURING MY MONEY... Thanks Nicholas
This is true. Being a trader here in PH and a forever student of the markets, proper risk management despite my 45% winrate I managed to hit my annual quota in the 1st half of the yr. Be patient with winning trades and impatiently ruthless with losing once. Its quite helpful in a market without short sell.
But have you encountered a situation were there seems like a portfolio level to which your account seems to be returning to a specific level? We call it portfolio resistance, it is a case of breaking out of a certain level in your portfolio amount then suddenly you return back to the level unconciously. By the way, I like how you inserted a tony robbins video, in our trading community here we always use some of his motivational videos to jumpstart our mornings. It has been part of our routine.
This video just opened up trading for me, wow I really needed it, I have been taking major losses while making minor profits. keep them coming. From South Africa.
Sounds like a textbook case of loss aversion. Many traders go through that but it's something you can work at and improve. At least you have identified the issue!
Two quick questions please: 1) if trade ends up break even, do you count it as loss in your i.e. ~60% rate? 2) do you calculate all the scale in's and scale'outs during few days into one Net trade outcome (win or loss)?
I personally exclude break-even trades from my win ratio, I just keep track of what % of my total trades turn out to be break-even. A break-even trade isn't really a winner or a loser, but it's important to know how much they cost you in commissions and how often they occur. Just my two cents on that question :)
Spot on Nick. As a new learning trader, I understood these concepts already but couldn't get my head around why people focus so much on pips. Thanks for helping reinforce and trust in this concept. 😀
What do you think about taking on a position with your whole account balance but only risking say 1 percent of it per trade or .20 per en of of per trade while picking up profits at say 2-4 percent of the position.is that too big of a position or it dosent matter since I'm only risking a small amount?
My win rate is very low, around 20%, risk per trade 1%, however, my risk to reward ratio is 1:14 which makes my winning trades huge. My trade sample is pretty big, around 90 trades month, but the profits are worth that. Also it is worth to mention that I have automated this system, otherwise taking 10 loses in a row would be psychologically very hard.
How to calculate win rate if i only TP 50% of shares and let the other 50% run. Ex, i bought 10K shares of ABC company and then when my TP is hit, i only sold 5k of shares and then let the remaining 5k run (now 78% and on the 10th week). I dont plan to exit the remaining 5k unless there is a reason on hte stock will start to change trend. In this case, how do i measure my win rate? I am doing this for all my stocks and for the past 3 months, i have only 3 completed trades, 2 SL losses and 1 completed win. though my P&L on unrealized gain is already at 30%. Thanks for your help.
hey, have you considered creating a discord server for your audience, being a beginner trader there isn't really anyone that I can ask for any small pieces of advice
my problem is that you said my win ratio is , give or take , 8 percent per month, if you are a professional trader, and you want to make 5000 a month, if taxes come in it is half in Belgium, you have to have in forex , a gigantic amount of money to do that, am i right on this or am i missing something ?
Lets says i have $1000. I risk 0.2%=$2 and lost 10 times. So to get a 4% profit, on each trade i need to take a reward of $40? So my risk to reward is 1:20 on each trader? not making sense to me
The fallacy of this whole multiple R wins is that you actually need a system that can achieve those 2-x ratios. if you a are a scalper If you have a system that wins 70% of time , but is a 1:1 you are still a winner
Think about how often you have to take a trade at a 1 to 1 it can become mentally draining knowing you have to be on point and watching your charts. As Paul Tudor Jones once said "I can be a complete imbecile and lose 80% of the time and win 20% of the time and still not lose" I aim for 1 to 5 and I can be less stressed worrying if I can sustain a losing streak
tnx for the video Nicholas, i would like to ask one simple question..what happens if you are a consistent trader and keep increasing lot size proportionally as you trade year in year out.. i mean, at what point would a trader "move" a market? .. 1 billion USD account and leverage 500:1? ..or 10 bn, 100 bn? .. i'm saying is at what point does the increase of account size stop..and why? pyschological issue, barriers, of just not accepting it can be done..or? true limitations as in stock trading where you hit the commission and stock availability-float? .. i would be insanely glad if you could respond to this, and be grateful to the end)) Thank you for your work and inspiration..
Most brokers have a tiered margin system, so you have less leverage available the larger the position size. So you wouldn't be looking at 500:1 leverage on an account size that big. There are many things that limit the growth on an account, but it's extremely unlikely to happen to individual traders trading just their own money. Amongst all the many reasons, you have to also consider that in the market you can only trade if there is someone to take the other side of your trade. If you have a huge position you want to open or dump in the market, you're not going to be able to do that all at once. That means you also can't be as agile with new opportunities.
So you shouldn't be investing the same lot size on a single strategy ? I understood the pip count and why it happens but I didn't quite understand why you should be doing that ? Unless you calculate the lot size depending on the risk reward ratio
Your position size should vary depending on the opportunity, you need to also consider things like the size of your stop loss etc. For example, if one trade has a 30 pip stop loss and the other has a 50 pip stop loss, if you use the same lot size on both trades you are automatically risking more on the 50 pip stop loss trade. But what if it isn't actually the better opportunity?
I've been trading for around a year and a half and am in small profit however I've got a brick wall and can't seem to get to the next level of profit. I'm roughly 80% lose 20% win but my wins are quite big. How would you combat this? Great videos.
@@fxcg2 slow but steady. Ive been trading a.i with an embedded strategy for the past 2 years with a 60% win rate, 80% annual return and a 6% drawdown on average. Still plodding along
@@lonetobefree5722 I am live trading for a few months now. Eith fulltime job, i may miss a few trades here and there, but so far, the journey is very nice and i enjoy it. wish you all the best in the future.
Sorry may be a dumb question but I just need to clarify. Does he mean in 1 trade like find a trade that you could win 5k and put a stop loss on for 1k?
That isn’t a strategy, it’s just asymmetric risk:return ratio. You’ll find that all profitable traders take this approach. However, it sounds like your stop loss may have been too tight and position size too big. You shouldn’t be risking more than 2% per trade and don’t trade with real money until you know what you’re doing, have a system that works and have months of performance to show you are consistent.
@@Duomoinitiative what do you mean by position size too big and stop loss too tight? By position size are you referring to how much money invested? And when you say you shouldn't risk more then 2% do you mean of your overall account balance or of your position ? He said he had a small stop loss isnt that what you're duppose to do if you're risking low percentages I'm confused. And if risk to reward rstio arent strategies then what are examples of strategies?
@@Duomoinitiative I still dont understand how that risk ratio you mentioned in the video works when having 10 positions open at once . It says risk only upto 2% of the account but risk only .2% per trade and take profits at 4% is that correct? Say I have $50000 overall in my account and I want to have 10 open trades at same time. Wouldn't that mean that I have to divide the 2% of my account I am risking which is 1000$, into 10 trades which would equal to 100$per position. if I am risking .2% per trade wouldn't that mean that in order to get back 4% of overall account for one of the trades (100$ position) wouldn't it need to go up 2000%?? To make 2000$ which is 4% of the 50000 account? Or did you mean to say 10 trades overall each done separately with a position size of your whole account balance risking only .2% percent of it while taking profit at 4% 10 times? Because that would make more sense then having 10 position open at same time then you'd have go divide the position size making it harder to achieve 4% return on overall account since the position is so small. It would literally be almost impossible it would have go up by the 1000s percentage wise. Lmk where I'm getting this wrong plz
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I started building my strategy, over a 100 trades I would only win between 30-40 of them, with loosing streaks of about 7-10. At the end of the 100 trades, I was making a profit of about 30% of my account size. I was completly perplexed, how could it be? Risk management and position sizing... I still couldn't believe it, but this video reasured me I'm on the right path! Thank you so much.
what was your risk to reward cause am 1:2 and dont see much profits as of yet, I have to tweak a bit
Basically what he means is when you win, win big and when you lose, you should lose less. I always thought I was a decent trader but my trading r:r was 1:2 which later I realized was not good at all. I learned the hard way is that I’d rather have 1 trade that’s 5:1 than have 20 trades that’s 1:1 or 1:2. Always risk less and have huge returns so even when you’re wrong you can cover all your losses :)
Are you a swing trader what time frame do you use?
nandi naufaldi yes swing and daily timeframe
You can do any kind of trading on any kind of time frame.
This video hits home. I'm a relatively new trader (about 6 months) and for about 5 months I was overly stressing my win rate. Recently I have come to realize that my win rate does not matter as much if my strategy minimizes loses while having a high reward to risk ratio
Exactly! But I think many new traders have to go through that period of feeling like they need to win win win at all costs
@@Duomoinitiative The truth is that you learn more from your own experiences than any experience someone else tells you about. So yes, traders need to go through the many mistakes past and future traders have gone through and will go through in order to get to the next level
My SR is 74% and profit factor is sub 1%....and profitable.
Regarding Winrate, it's irrelevant unless coupled with your avg. win % and avg. loss %. I have an 87.5% winrate, which by itself is meaningless; my avg. win is 83%, avg. loss 45%. Combined with win/loss amounts Winrate is very informative.
Man, this video spoke loads to me. After my experience this week it was like you made this video just for me. Thanks Nicholas! You are spot on!
What was your experience this week? I've had plenty of lessons learned the hard way. As long as we learn from them, they can only make us better in the long run!
@@Duomoinitiative I have been the trader who won't accept losses for a long time now. Over 12 months of testing my strategy on a demo then went live in February this year. My balance was huge and I was keeping my equity above my starting point for the whole time just waiting for that big reversal in the market but in my own panic I placed some stupid hedging trades in the opposite direction again only to find myself feeling trapped. Man, I had balls of steel to having no balls at all. I panicked, not knowing what to do. All buy orders, no sell orders when gold was at the bottom a few days ago and not wanting to be caught with more sell orders at the bottom I decided enough is enough, too much risk and stressing about what would happen when I went to sleep I closed everything before I chewed up my capital. Well, the last few days proved to make that a stupid move because the market turned back to the upside! Oh bugger, I'd be back in the black again but who was to know... Certainly not me! Fortunately, despite taking a 25% hit to my initial capital and a loss of 9 months work and profit I'm still here and listening to a great mate (Phil) who also follows your channel and people like yourself I finally feel that I am arming myself with the tools to be able to sleep at night and refine a more relaxed strategy. Reality is my tested strategy was and would work but there is just too much risk to live with.
Thanks Nicholas for the great videos. You are a really smart, funny guy and people like yourself prove to me there are better ways than mine to do this. I'm just lucky I got out alive and to be able to trade another day.
I needed this today perfect timing another great video. Thanks man!
You're welcome Drew. Thanks for watching
Best trading channel in my opinion, just fully understanding the concepts and exploring the genuine strategies this channel provides I have become a profitable trader
I remember braging about my accuracy so much I held on to a winning trade until it turns into a loss. The trade eventually worked out. However, i knew I should have cut the trade in profit and reenter on the next Oppertunity.
At some point could you make a video on your trading station? Computer, monitor, etc.. Thank you!
I'm the least techy person around, so I'm not the best person to talk about that stuff. I will maybe give it a go at some point.
Thanks man really appreciate 🙏
🔹 Get FREE access to the Duomo Trader Development Program: duomotrading.com/FreeDuomoTraining
🔹 Add us on Instagram: instagram.com/duomoinitiative/
🔹 Our second channel for financial news and analysis: th-cam.com/users/MarketMoversFinancialNewsandAnalysis
WOW ... we never need to meet, you already know me. Over trading, hi winning trade percentage above the 85% mark - what loss aversion, I have only blown up my account "a lot". Gotta say, really happy to have watched this video to know I'm not alone, even more happy to have completed the free online course and am halfway through the paid course. NO MORE LISTENING TO THIEVING BROKERS AND BURING MY MONEY... Thanks Nicholas
Very very good advice sir. My eyes are open now about win rate! thank you
This is true. Being a trader here in PH and a forever student of the markets, proper risk management despite my 45% winrate I managed to hit my annual quota in the 1st half of the yr. Be patient with winning trades and impatiently ruthless with losing once. Its quite helpful in a market without short sell.
Great job exceeding your own targets! You're absolutely right.
But have you encountered a situation were there seems like a portfolio level to which your account seems to be returning to a specific level? We call it portfolio resistance, it is a case of breaking out of a certain level in your portfolio amount then suddenly you return back to the level unconciously. By the way, I like how you inserted a tony robbins video, in our trading community here we always use some of his motivational videos to jumpstart our mornings. It has been part of our routine.
This video just opened up trading for me, wow I really needed it, I have been taking major losses while making minor profits. keep them coming. From South Africa.
Sounds like a textbook case of loss aversion. Many traders go through that but it's something you can work at and improve. At least you have identified the issue!
Two quick questions please:
1) if trade ends up break even, do you count it as loss in your i.e. ~60% rate?
2) do you calculate all the scale in's and scale'outs during few days into one Net trade outcome (win or loss)?
I personally exclude break-even trades from my win ratio, I just keep track of what % of my total trades turn out to be break-even. A break-even trade isn't really a winner or a loser, but it's important to know how much they cost you in commissions and how often they occur. Just my two cents on that question :)
I like the new setting with the books in the back and stuff
Appreciate the feedback!
Spot on Nick. As a new learning trader, I understood these concepts already but couldn't get my head around why people focus so much on pips. Thanks for helping reinforce and trust in this concept. 😀
No problem Nick! Thanks for watching, glad it helped!
Wow! On point. This is how money is being made in trading. Perfect video at a perfect time. Just confirmed what I was looking at.🙏
What do you think about taking on a position with your whole account balance but only risking say 1 percent of it per trade or .20 per en of of per trade while picking up profits at say 2-4 percent of the position.is that too big of a position or it dosent matter since I'm only risking a small amount?
Can you please explain importance of Average Win and Average Loss and it's impact in long run ?
My win rate is very low, around 20%, risk per trade 1%, however, my risk to reward ratio is 1:14 which makes my winning trades huge. My trade sample is pretty big, around 90 trades month, but the profits are worth that. Also it is worth to mention that I have automated this system, otherwise taking 10 loses in a row would be psychologically very hard.
How did you automate the system please. Did you write code?
What if you reverse engineer the strategy?
@@elclis1549 Nah man, it worked until it didn't. Eventually, this strategy is not a long term solution.
How to calculate win rate if i only TP 50% of shares and let the other 50% run. Ex, i bought 10K shares of ABC company and then when my TP is hit, i only sold 5k of shares and then let the remaining 5k run (now 78% and on the 10th week). I dont plan to exit the remaining 5k unless there is a reason on hte stock will start to change trend. In this case, how do i measure my win rate? I am doing this for all my stocks and for the past 3 months, i have only 3 completed trades, 2 SL losses and 1 completed win. though my P&L on unrealized gain is already at 30%. Thanks for your help.
hey, have you considered creating a discord server for your audience, being a beginner trader there isn't really anyone that I can ask for any small pieces of advice
Yes, we've considered it but it's not something we're likely to do any time soon.
gold nuggets of info here!! thanks Nic
So true. I've come to realise not to compare apples to oranges.
So essentially it’s your indicators that you use to get in a trade, backed by proper risk management?
great video mate
Thanks for the info !! : )
What platform do you trade on? Loved the video btw
Guys! Uk paper trading! How? What do you use? Thanks
Tradingview
my problem is that you said my win ratio is , give or take , 8 percent per month, if you are a professional trader, and you want to make 5000 a month, if taxes come in it is half in Belgium, you have to have in forex , a gigantic amount of money to do that, am i right on this or am i missing something ?
Lets says i have $1000. I risk 0.2%=$2 and lost 10 times. So to get a 4% profit, on each trade i need to take a reward of $40? So my risk to reward is 1:20 on each trader? not making sense to me
The fallacy of this whole multiple R wins is that you actually need a system that can achieve those 2-x ratios.
if you a are a scalper If you have a system that wins 70% of time , but is a 1:1 you are still a winner
Think about how often you have to take a trade at a 1 to 1 it can become mentally draining knowing you have to be on point and watching your charts. As Paul Tudor Jones once said "I can be a complete imbecile and lose 80% of the time and win 20% of the time and still not lose" I aim for 1 to 5 and I can be less stressed worrying if I can sustain a losing streak
Thank you bro 👍👍👍
tnx for the video Nicholas, i would like to ask one simple question..what happens if you are a consistent trader and keep increasing lot size proportionally as you trade year in year out.. i mean, at what point would a trader "move" a market? ..
1 billion USD account and leverage 500:1? ..or 10 bn, 100 bn? ..
i'm saying is at what point does the increase of account size stop..and why? pyschological issue, barriers, of just not accepting it can be done..or? true limitations as in stock trading where you hit the commission and stock availability-float? ..
i would be insanely glad if you could respond to this, and be grateful to the end))
Thank you for your work and inspiration..
Most brokers have a tiered margin system, so you have less leverage available the larger the position size. So you wouldn't be looking at 500:1 leverage on an account size that big.
There are many things that limit the growth on an account, but it's extremely unlikely to happen to individual traders trading just their own money.
Amongst all the many reasons, you have to also consider that in the market you can only trade if there is someone to take the other side of your trade. If you have a huge position you want to open or dump in the market, you're not going to be able to do that all at once. That means you also can't be as agile with new opportunities.
So you shouldn't be investing the same lot size on a single strategy ?
I understood the pip count and why it happens but I didn't quite understand why you should be doing that ?
Unless you calculate the lot size depending on the risk reward ratio
Your position size should vary depending on the opportunity, you need to also consider things like the size of your stop loss etc. For example, if one trade has a 30 pip stop loss and the other has a 50 pip stop loss, if you use the same lot size on both trades you are automatically risking more on the 50 pip stop loss trade. But what if it isn't actually the better opportunity?
trading a strategy i created and improved vs following someone else's strategy that works, which is better
Great video bro for explaining how Forex trading works.
I'm a new and want to start Forex trading. You're 100% correct 💯👍
I've been trading for around a year and a half and am in small profit however I've got a brick wall and can't seem to get to the next level of profit. I'm roughly 80% lose 20% win but my wins are quite big. How would you combat this?
Great videos.
Hey man, hows you trading going now
@@fxcg2 slow but steady. Ive been trading a.i with an embedded strategy for the past 2 years with a 60% win rate, 80% annual return and a 6% drawdown on average. Still plodding along
@@lonetobefree5722 thats very nice. thanks for replying
@@lonetobefree5722 I am live trading for a few months now. Eith fulltime job, i may miss a few trades here and there, but so far, the journey is very nice and i enjoy it. wish you all the best in the future.
Sorry may be a dumb question but I just need to clarify. Does he mean in 1 trade like find a trade that you could win 5k and put a stop loss on for 1k?
cheers mate!
Do you have any epic movies to recommend that are about trading?
The Big Short
Rogue Trader th-cam.com/video/vgqSVVLFmds/w-d-xo.html
Great video 👍👍👍
Thanks Jake!
Try to formulate a strategies that can avoid loses , make average of 30% profits monthly....
nice nicholos
95/5
Are you talking about doubling your lot size each time u lose to recover your previous loss and so on?
No, that's a martingale approach which I'd advise you NOT to do. I'm talking about where you take a profit or a loss.
~ Nicholas
golden
🙌
tight stop loss are bad
That's what I'm saying
.2% is really tight you'll basically be assuring you lose all the time
risk 6 sen for 1 dollar, really?
Madaz Money reckons he had a 95% winning month and up a million lol
Its easier to say than doing.... Your strategy didn't work and i lost $200 today by trying all this stuff
Sorry to hear you lost money. What strategy are you referring to exactly?
@@Duomoinitiative small sl and large tp... Stop hunt by market maker blown my account
That isn’t a strategy, it’s just asymmetric risk:return ratio. You’ll find that all profitable traders take this approach. However, it sounds like your stop loss may have been too tight and position size too big. You shouldn’t be risking more than 2% per trade and don’t trade with real money until you know what you’re doing, have a system that works and have months of performance to show you are consistent.
@@Duomoinitiative what do you mean by position size too big and stop loss too tight? By position size are you referring to how much money invested? And when you say you shouldn't risk more then 2% do you mean of your overall account balance or of your position ? He said he had a small stop loss isnt that what you're duppose to do if you're risking low percentages I'm confused. And if risk to reward rstio arent strategies then what are examples of strategies?
@@Duomoinitiative I still dont understand how that risk ratio you mentioned in the video works when having 10 positions open at once . It says risk only upto 2% of the account but risk only .2% per trade and take profits at 4% is that correct? Say I have $50000 overall in my account and I want to have 10 open trades at same time. Wouldn't that mean that I have to divide the 2% of my account I am risking which is 1000$, into 10 trades which would equal to 100$per position. if I am risking .2% per trade wouldn't that mean that in order to get back 4% of overall account for one of the trades (100$ position) wouldn't it need to go up 2000%?? To make 2000$ which is 4% of the 50000 account? Or did you mean to say 10 trades overall each done separately with a position size of your whole account balance risking only .2% percent of it while taking profit at 4% 10 times? Because that would make more sense then having 10 position open at same time then you'd have go divide the position size making it harder to achieve 4% return on overall account since the position is so small. It would literally be almost impossible it would have go up by the 1000s percentage wise. Lmk where I'm getting this wrong plz