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Phil Lane <logical@xxxxxxxxxxxxx> wrote:
>
> Does this work for any of you? The idea seems to be that the trades
drawing
> down beyond a certain point will generally turn out to be unsuccessful.
But
> I find the trades with the most drawdown have about the same probability
of
> working as do the smaller ones, and many times they lead to the biggest
> gains. MAE - A pipe dream? Probably depends on your system or something.
>
When testing systems I start with no stops, and plot frequency
distributions of both Maximum Adverse Excursions and Maximum Profitable
Excursions.
Eyeballing these gives me a good starting point for defining initial and
breakeven stops, and profit targets.
Hugh.
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