Matthew, I’m not a math expert, but tell me this: How does Avg Win:$6,025/Avg Loss:$2,500 compute to a W:L ratio of 47.0:01 for Bris.
Before anyone responds, I would first suggest that you take a look at Bris’s W:L record, that is the percentage of wins to losses. I think you may find your answer there Mr. Reid.
Ewart since you are system vendor, I am surprise you don’t understand what W:L means.
W:L is Total Wins/Total Losses.
To only use Average Win to Average Loss would not be accurate at all. A system’s Average win can be $1000 and Average loss can be $500 and if you use that for calculating W:L, you would get:
W:L = 1000/500 = 2.0, which look pretty good.
BUT if the system is only correct 10% of time and wrong 90%, then after 10 trades you will have total profits of:
1 x $1000 = $1000
and total losses of:
9 $500 = $4500
and if you use this for W:L calculation, you will get:
W:L = $1000/$4500 = 0.22
which is completely different than above and more accurate picture of profitability of the system.
Chris
The W:L ratio at C2 was originally the ratio of Average Win/Average Loss.
I reasoned for the Profit Factor and Expectancy to be included as part of the key statistics.
Later, MK changed the calculation of this W:L ratio to match the Profit Factor, so for the techies, it is called the Profit Factor and for others, it is the W:L Ratio.
Mr Harris, I did not intend to raise a discussion about the Bris system. Bris numbers speak for the system, except that 47.0:01 which seems to be a calculation error. My interest in this has to do only with the math that was used to arrive at that number.
Happy trading.
Percentage win/loss does not tell the whole story.
Consider this:
Of 10 trades placed 5 trades are losers, and 5 trades are winners. That’s 50% winning trades. But when the results show that the 5 winning trades total $10,000.00 in profit and the 5 losing trades, due to using a tight stop loss, total only $2,000.00 in losses, that’s a W:L dollar ratio of 5:1. A 5:1 W:L dollar ratio means that you make 5 times more on your winners than what you lose on your stop loss trades. A 5:1 W:L dollar ratio is highly profitable trading, yet only 50% of those trades are winners.
I wrote:Matthew, I’m not a math expert, but tell me this: How does Avg Win:$6,025/Avg Loss:$2,500 compute to a W:L ratio of 47.0:01 for Bris.
I reply: O.K. I now see how the 47.0:1 came about. I was’nt figuring in the 95.1% win.
