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  • Answer Upon - How To Trade A 50 Day Moving Average Strategy

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    Did you know that most traders overtrade, they put on far too many trades. They jump in and out or allow a small loss to become a large loss that wipes out a large proportion of their trading equity. From my own backtesting research I found the above strategy to be highly effective if you limit your downside to a fixed stop loss level. This allows you to limit losses and calculate your maximum drawdown, both of which are the most important aspects of stock market trading. So for example if your largest loss is $300 and the strategy has a maximum of 4 losses in a row when backtested, you know you need $1500 minimum to fund your account.

    Trading this strategy is very profitable.

    Here are the results from 16/12/2005 to 21/08/2006 for the FTSE100

    Total net profit ?9940

    Gross Profit ?12930
    Gross Loss ?2990

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    ion of their trading equity. From my own backtesting research I found the above strategy to be highly effective if you limit your downside to a fixed stop loss level. This allows you to limit losses and calculate your maximum drawdown, both of which are the most important aspects of stock market trading. So for example if your largest loss is $300 and the strategy has a maximum of 4 losses in a row when backtested, you know you need $1500 minimum to fund your account.

    Trading this strategy is very profitable.

    Here are the results from 16/12/2005 to 21/08/2006 for the FTSE100

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    Gross Profit ?12930
    Gross Loss ?2990
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    Trading this strategy is very profitable.

    Here are the results from 16/12/2005 to 21/08/2006 for the FTSE100

    Total net profit ?9940

    Gross Profit ?12930
    Gross Loss ?2990
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    Trading this strategy is very profitable.

    Here are the results from 16/12/2005 to 21/08/2006 for the FTSE100

    Total net profit ?9940

    Gross Profit ?12930
    Gross Loss ?2990
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    Here are the results from 16/12/2005 to 21/08/2006 for the FTSE100

    Total net profit ?9940

    Gross Profit ?12930
    Gross Loss ?2990

    Total no of trades 19
    Percent Profitable 47%

    No of winning trade 8
    No of losing trades 11

    Largest winning trade ?4160
    Largest losing trade ?300

    Max consecutive winners 4
    Max consecutive losers 4

    Max closed out drawdown ?1200

    Account size required ?1500
    Return on Account 662%

    I think that most traders would be satisfied with a return of 600% plus.

    This is achieved by limiting the MAX LOSING TRADE TO ?300 AND NO MORE!

    What is even more encouraging is the fact that spread betting insiders often say that the real money makers are those who trad

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