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Equity Curve Silmulator - The Big Picture of Trading

Equity Curve Silmulator - The Big Picture of Trading

FromB The Trader


Equity Curve Silmulator - The Big Picture of Trading

FromB The Trader

ratings:
Length:
12 minutes
Released:
Dec 6, 2019
Format:
Podcast episode

Description

In our recent conversation, Brian Lee shared an equity curve simulator tool, and that was a complete game-changer for me.   In the simulator, you enter your win percentage, your risk/reward ratio and a time period, and you really get to see your projected results over time.   When you are trading, when you are “in the moment”, you only see each individual trade, each loss, and each win. In one day you may lose 6 trades and you may only win 2 trades, leaving you with a pretty bad win/loss ratio. But as long as you stick to the 3:1 rule, all you lose is 6R. At the same time, by winning twice you get the same 6R, so you are actually OK at the end. However, you only get to see it this way if you’re looking at the big picture, as you do in the equity curve simulator. In the moment, 6 losses in a row might seriously hurt your confidence and destroy your mindset.   The lesson here is to pay less attention to the win percentage and each loss individually. Instead, focus more on following your profit plan long-term. I’m planning to give my 3:1 Reward to Risk trading strategy at least 3 months to let my wins and losses accumulate before drawing any conclusions.   Subscribe to my newsletter to see my trading tips and follow me on social media to see the latest updates.
Released:
Dec 6, 2019
Format:
Podcast episode

Titles in the series (100)

Sharing my trading journey and interviewing successful traders along the way to help you learn and become a more profitable trader!