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Old 11-29-2006, 02:37 PM
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When your EA fails many times consecutively, it means you need to optimize the settings for the new cycle. If you can't optimize, you need to implement the MM suitable for your system to survive the bad cycle.

I'm interested in Elder's 2% and 6% MM. He rules that you should risk only 2% of equity at any given time. Anytime your account loses 6% of equity from the end of last month, stop trading for the whole month. After that, you start with lowest lot, increase bit by bit. Until your account equity increases by 6% should you run it at full throttle. With this MM, you should minimize the loss during bad cycle and maximize the winning during good one.

The strategy seems awkward in forex, because 2% risk is too boring to trade. With 100:1 leverage and $10,000 equity, you can risk only 20 pips at any given time. When your account down 60 pips in November, you'd stop trading immediately and start again with 0.1 lot on December 1. With $1,000 equity, you should go with mini-lot. You then lose only 2% of equity for 20 pips, rather than 2 pips.

I'm going to test this strategy with my systems. If it works [in backtesting and forward testing], i'll publish my finding. And of course, integrate this MM in the new ZeroCode.
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Last edited by scorpion : 11-29-2006 at 02:42 PM.
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