The year 2022 is a year full of excesses due to the change in the market paradigm (war, inflation, rising policy rates, etc.).
Trend-following robots can get caught in market excesses and lose more often than they would win. The idea of this strategy is to take bounces in hourly zones to catch reversals in statistically winning markets.
Here is the backtest of the robot on 200k units with a spread of 1.4 and at 0.8€/pt with a soft reinvestment of the gains.
Starting in my live account (0.8€ /pt)
—> Note to read before going further <—
I have received a few messages from clients whose comments have alerted me to 3 topics that come up in particular:
- Money management
- Under the pretext of seeing a backtest in line with the market considered, some customers increase the leverage in the hope of winning quickly. If at the time of your subscription you fall into a market context not already seen by the robot during its design, you will wipe out your capital and you will not be there during the profitable market phases of the year.
- Lack of knowledge of the financial markets
- In talking to my clients, I have seen different classes of people, professional traders, amateurs, and neophytes. It is easy to talk to traders who understand the cycles, phases, and trends of the markets for example. Others, have very short-term reasoning and do not understand why they do not win all the time.
- Why do robots win? Why do robots lose? Most people don’t ask this question except to say that it is not normal for robots to lose and therefore cry scam!
- The trading robot class
- When you make a strategy you have choices, the trend or the market range. I chose the trend, if the market is in range, then my robots will work less well and vice versa.
- I have chosen a discretionary strategy which means that the robot will enter and exit positions according to strict rules that cannot be changed over time. If for 2 years a stop of 150 points allowed trade in a secure way and war broke out increasing the volatility of the markets. A person who does not understand that SLs are going to be hit more often than before and that it is, therefore, necessary to review his money management, is doomed to failure in his investments.
- I remind you that a robot as I conceive it repeats a discretionary strategy and that statistically, this strategy is winning in time.
- I have chosen a stop of 1.1% max for my robots. Some may design robots based on long only because an index is only designed to go up and enlarge the SL to allow for range phases when in position. However, when SL is hit, it can have a big impact on capital. This is not my choice because some clients abuse the leverage and put themselves at risk.
In conclusion, if you have not understood that :
- – Investing in the stock market involves proven risks
- – You are the only one responsible for your actions
- – I am not selling you a dream
- – You take a trading robot in any case and you understand the associated risks
- – A robot cannot predict the future of the financial markets
- – A robot is not designed to make you win every day in the markets
- – A robot only reproduces a discretionary pattern to enter or exit a position
- – I use my robots and like you, I win and lose. I’ve been keeping track every week for 2 years on my website
- – Without strict money management you can’t take advantage of profitable trends
- – To have a judgment on the strategy of a robot on 1 month of use during an episodic period like a war or other
I prefer that you go your way and not take any of my robots, please. There are more talented people than me who can help you in your adventure of investing in the marketplace.