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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: elf who wrote (12356)	1/11/1999 9:04:00 AM
From: Tom Trader	Respond to of 44573

Elf, thanks for your comments and you've hit the nail on the head both in terms of the salient points in my posts and those made by Chip. I am trying to find a way to build in the draw-down factor into the formulation. The win/loss ratio is mainly relevant in terms of the varying ratios in the different markets that I trade. While I am confident that the win/loss ratios are valid over a period of time there is always the potential for a sudden draw-down to occur. For example, if I had started using Chip's formulation with the spoo two trades ago, I'd be almost wiped out because I just had one of the largest draw-downs that I have had in quite a while. On the other hand if I'd commenced to use the formulation with the bonds with my last trade, I'd be sitting on a massive profit. So the challenge is how best to blend in the the various components.