Hi! I am a new trader at Collective2:
Gold and Silver
Any feedback greatly appreciated!
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Good work Orest, your system is obviously riding the fantastic uptrend created by Gold and Silver, that’s why all your long positions are winners.
Keep it up and good luck.
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A drawdown greater than 5% on a single trade can be risky. If you’re risking more than 5% on any given trade, it might be a sign of excessive risk for that position. For many traders, keeping drawdown below 2-3% per trade is generally seen as a safer approach to preserve capital and avoid large swings in equity.
True, in GENERAL, because a trader can keep his losses small (on a trade by trade basis) and STILL lose a chunk of money at the end of the trading day or week.
Take your February 2, 2025 trading session for example, you kept your losses small but still lost almost 12% of your trading capital that day.
(Absolutely nothing personal against you or your system, I wish you all the best).
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Thank you for your feedback on my strategy!
You are quite welcome, happy trading.
So I trade 10 Micro’s. Would you suggest 5 Micros instead?
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Hard to say, because reducing the size of the positions also reduces the profits.
The size of the position depends on the logic of your system, the location of your stop and your risk tolerance.
Some traders prefer to make $100k per year trading 10 micros, even if that produces, say, a 45% maximum drawdown, while others prefer to earn $50k/year “only” (trading 5 micros) with a 25% maximum drawdown.
Yes its a tradeoff, can’t please everyone lol.
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Absolutely, but one thing is certain, each system has its own optimal position sizing, assuming it has clearly defined trading rules.
So if that’s the case (the system is 100% backtestable) you can experiment with different stops (1%, 2%, 3%, …, 15%…etc…) and find the optimal percentage of trading capital to risk on each trade.
As you probably already know, when that percentage reaches a certain level, the risk of ruin becomes certain, no matter how profitable the trading system is.
If the trader risks 100% of his capital on each trade for instance, the first losing trade will wipe him out, by definition.
More greed always backfires!
Nice call on that long 10 micros gold.
What is puzzling is that the S&P 500 and gold are negatively correlated (most of the time), and yet gold and the US equity index are both on fire and trending up like crazy!
Anyway, who cares, we traders trade what moves, the “why” this market is moving this way or that way is not important.
Thank you! The positive correlation might be because of the recent election.
Yes it’s possible.
I think gold/silver won’t make any significant move until the FOMC meeting (February 19, 2025) is over. The market is also waiting for Trump’s speech ( due this Tuesday), not to mention the US Initial Jobless Claim (Thursday) so these events could create a lot of sudden moves and unexpected reversals this week.
No volatile week yet, but I might of just jinxed it.
I put your system on my watch list, you are doing great and your system is obviously following the huge uptrend on gold and silver on the higher time frames, best of luck my friend.
Thank you! What are your thoughts on limiting the amount of Micro’s so the DD would be less?
its like a ying and a yang. Thank you.
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Oh yes.
Less risk = less reward, but the opposite is also true: more risk = higher profits AND higher probability of ruin.
The trick is to find the optimal “sweet spot”, and that requires testing and research.
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