Nomoretoxics Money Management -
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thread: Nomoretoxics Money Management

  1. #11
    Junior Member RittraderRS's Avatar
    17
    Hi nomo:
    Thank you for the great document. I was thinking about opening up a daily chart and using ATR to ascertain the daily range of a currency like you indicate. Any ideas on if this is a fantastic concept, and if it's, how many days to be contained in the indior. Thanks

    Jim
    I find this one useful. Based on ADR(13).
    https://www.cliqforex.com/attachment...1879834669.mq4

  2. #12
    Straightforward and to the point.
    Thanks

  3. #13
    Please, read carefully the record above. Might take time to digest. Don't go fast n' over reading. Take your time and be certain that you get it.

    Cheers.
    Hello Nomo

    Please help to see if I understand your MM correctly. I am putting dollar amount into it to allow it to be clear.

    Let states we start the account with USD10,000.

    Daily capitol risk 2% = 2% * 10,000 = USD200

    For the very first trade, the risk will be 1 percent = USD100

    Suppose, there is a commerce opportunity in EURUSD and the stoploss is 20pips. Each pips moves is USD10 (for standard account). So that the Lot amount ought to be (Risk Amount / Stoploss / pip value) = USD100 / 20 / 10 = 0.5 lot. So I shall only trade 0.5 lot.

    So for the aforementioned trade, my goal profit will be 40pips = USD200 and I am risking USD100.

    If this trade is powerful, I make USD200 and cease trading daily.

    If this trade fails, I will look for another opportunity. And assume the same opportunity as above is taken and it's effective, then I shall make USD100 for the day.

    If it fails , I dropped USD200 for the day.

    So for a month (assume 21 trading days), assume I have 50% success rate (1/3 of each situation ), therefore 7 days I make USD200, 7 days I make USD100 and 7 days I dropped USD200. I will make USD700 for the very first month.

    If for someone to live on trading, with states USD2000 monthly, then he need to have USD30,000 capitol in his account. Is this correct? Or unless the success rate is better.

    Is my understanding correct?


    Thanks
    Jeff Ng

  4. #14
    Hi Nomo

    Please help to see if I understand your MM properly. I'm putting dollar number into it to allow it to be clear.

    Let states we start the account with USD10,000.

    Daily capitol risk 2% = 2% * 10,000 = USD200

    For the very first trade, the risk will be 1 percent = USD100

    Suppose, there's a trade chance in EURUSD and also the stoploss is 20pips. Each pips moves is USD10 (for standard account). Hence the Lot amount ought to be (Risk Amount / Stoploss / pip value) = USD100 / 20 / 10 = 0.5 lot. So I shall only trade 0.5 lot.

    So for the above trade, my goal profit will be 40pips = USD200 and I am risking USD100.

    If this trade is powerful, I make USD200 and stop trading daily.

    In case this trade fails, I'll search for a different opportunity. And suppose the identical chance as above is taken and it is successful, I shall make USD100 for the day.

    If it fails , I lost USD200 for the afternoon.

    So for a month (assume 21 trading days), suppose I have 50% success rate (1/3 of every scenario), so 7 days I make USD200, 7 days I earn USD100 and 7 days I lost USD200. I'll make USD700 for the month.

    If for someone to live on trading, with states USD2000 monthly, then he need to have USD30,000 capitol in his account. Is this correct? Or unless the success rate is better.

    Is my perception correct?


    Thanks
    Jeff Ng
    Wouldn't percentage dollar-wise change daily though? Say you lose $200 the first day, another day two% your account will be $196 not $200 anymore.

  5. #15
    Wouldn't percentage dollar-wise alter every day though? Say you lose $200 the first day, the next day 2% your account will be $196 not $200 anymore.
    Yes. . .it will change.

  6. #16
    Hi Nomo

    Please help to find out if I understand your MM correctly. I'm putting dollar amount into it to allow it to be clear.

    Let says we start the account with USD10,000.

    Daily capitol risk 2% = 2% * 10,000 = USD200

    For the first transaction, the risk is going to be 1% = USD100

    Suppose, there's a trade chance in EURUSD and the stoploss is 20pips. Each pips moves is USD10 (for regular account). So the Lot amount should be (Risk Amount / Stoploss / / pip value) = USD100 / / 20 / 10 = 0.5 lot. So I will only trade 0.5 lot.

    So for the above trade, my target profit will be 40pips = USD200 and I am risking USD100.

    When this transaction is powerful, I make USD200 and cease trading daily.

    If this transaction fails, I will look for another opportunity. And suppose the identical chance as above is taken and it's effective, then I will make USD100 for the day.

    When it fails again, I lost USD200 for the day.

    So for a month (suppose 21 trading days), suppose I have 50% success rate (1/3 of each situation ), therefore 7 days I make USD200, 7 days I make USD100 and 7 days I lost USD200. I will make USD700 for the first month.

    When for somebody to live on trading, with says USD2000 monthly, he then need to have USD30,000 capitol in his account. Is this correct? Or unless the success rate is better.

    Is my perception correct?


    Due
    Jeff Ng
    in case you've 30k readily available for trading, you are going to be able to manage $600.00/2% risk a day.

    I personally don't receive any focus in my profits. I get focused more in my risk. Some people ask me a bout% of winnings, averages etc.. It is a waste of time and will only set you in your feet.

    Take this as a business. . .some months will be better and some will be fine. But in my book, I have not obtained a losing month since I use this code on money management. .

    My balance sheet is 1 month . I trade everyday but with a 1 month goal. A single day of trading is simply a 9 to 5 job, together with the benefit of never having a boss breathing on my neck. . .and I get to see T.V while my trade grows LOL.

    You're correct in your observations.

    My trading faith (if we could call it that way) is this money management I simply laid out.

    Cheers

  7. #17
    I find this one useful. Based on ADR(13).
    Thank you for the indior, you rockJim

  8. #18
    Hi nomo:
    Thanks for the Fantastic document. I was thinking about opening a daily chart and using ATR to ascertain the daily range of a currency just like you suggest. Any thoughts on if it's, how many occasions to be included in the indior, and if this is a good idea. Thanks

    Jim
    Jim

    I'm so sorry did not respond to your post.

    You could try ATR. I do it by ear, to be frank.

    Let us know your findings, please.

    Cheers.

  9. #19
    I think you need to reevaluate what MM signifies....Phorex Phreak






    My money managements principles







    Not in any particular order



    Daily capital risk = 2% - never to be confused with 2 percent risk per transaction. A huge mistake.

    Will divide trades in two 1%(risk) trades. This way, You#8217;ll have two opportunities for trading.

    Optimum risk/reward #8211; 2:1.


    If you make 2:1 #8211; please stop trading.

    If you lose 2% - only discontinue trading, there#8217;s nothing more for you.

    Here#8217;s most probable outcome(s) should you follow these rules.

    A: You put a trade, searching for 2:1 using a 1% risk. 2:I'm achievable, market moves onto your side. Your target will be hit, You close the charts and go do anything.

    B: You put a commerce searching to get a 2:1 using a 1% risk. 2:1 is achievable, market moves against you(stopped outside ).
    You look for the next opportunity (nevertheless have 1% more to perform )

    C: You put a commerce searching to get a 2:1 using a 1% risk. 2:1 is achievable, market moves against you. AGAIN!! You close the charts and go do whatever#8230;2 percent daily risk limit has been reached.



    OR



    A: You put a commerce looking to get a 2:1 using a 1% risk. 2:1 is achievable, market moves against you.
    You look for the next opportunity (nevertheless have 1% more to perform )

    B: You put a trade, searching for 2:1 using a 1% risk. 2:I'm achievable, market moves onto your side. Your target will be hit, You close the charts and go do whatever

    Why don#8217;t go for a third round???

    Inside my screw-ups, I did this third round many times. I don#8217;t understand, maybe is attached to the regulation of probabilities or some thing. But trust me on this one. If you did the math, then you've got 1% in your pocket. Do yourself a favor and don#8217;t even go for longer.

    If you lose one trip (1%) and it#8217;s like 2-5 PM and nothing else occurs, don#8217;t even feel guilty. Just feel that you place at risk 1% of your capital (which can be 1/2 of your allowed daily risk) in order to receive double. Please wrap it up. The market will be there tomorrow, trust me. If it#8217;s Friday, unless a holiday on Monday, the market will be there next week.





    OR





    Any of those outcomes laid out before with the addition of moving stops/targets.





    In this one, be prepared to be screwed over the long run.




    1:1 Risk/Reward

    Simply as: If you buy a 1:1#8230;proceed for the next round. If nothing happens afterwards,
    close the charts. Be happy.

    Same daily two% guidelines apply.


    Okay, here8217;s the question many are searching for:

    How do I know if 2:1 is achievable??

    Keep reading.




    Common Sense



    It#8217;s important to know the daily range average of the pair you#8217;re prepared to exchange.

    On EUR/USD for example, a ballpark figure could be anywhere for 60-100 pips.

    When you've got a stop-loss around 80-100 pips space, you understand already that#8217;s not a standard situation on this pair. Imagine 80 pips on a 2:1 - I#8217;ll be 160 pips.

    If your stop is something easy like 20 pips, well you understand 2:1 is quite possible.

    I truly don#8217;t even have a hard and fast rule on this one. Making one is a waste of precious time. You need to consider how far this specific pair could stretch out on the time period you8217;re trading. Like in case you#8217;re investing London/NY session, then you are aware that the pair will normally run the average mile. If you#8217;re on Asia session trading some USD pairs, the range will be less.





    Load modification



    The load (# of lots) must be adjusted so that you risk the identical amount of% capital no matter how far-distant your stop is. You#8217;ll have more flexibility with mini-lots.

    If you#8217;re planning to go off-balance, be warned that you8217;ll earn less money than 1:1 or better transaction. My proposal would be to take these trades off the 2% rule and lower your load to the point you won#8217;t even feel sorry if you lose.

    In this specific case above(off balance), rather than measuring the transaction by% capital risk, use dollar amounts. Personally, I go like #8220;nicely I'm gonna risk 50 bucks on this one#8221; If you lose, take it off the 2% daily risk. Either if you win or lose, nevertheless you are able to shoot for longer, in case it#8217;s possible. My mentor called that trades #8220;Pizza Party#8221; trades.

    These rules is exactly what keeps my head above the water. They8217;re me very similar to a code and I won#8217;t even change it . I prefer not to trade should I feel temped to tweak this rules for any reason.


    I've reviewed this document and I hope haven#8217;t overlook anything, like I play these rules by memory after several decades. When I did, I#8217;ll make an #8220;Change #8221; LOL.

    I'm profitable because I combine both my system(s) along with also my Money Management Rules. If you get started adding/taking stuff off the rules, I promise you with all my heart, you#8217;ll get screwed in the long run.

    I sincerely hope you all can benefit from it.

    Good Karma.

  10. #20
    Member lcoco's Avatar
    38
    Enrolling.

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