Thanks brian_z, You openned my mind!!!
Best regards & good trade --- In [email protected], "brian_z111" <brian_z...@...> wrote: > > > As you said, with AB we can only use stop loss feature. > > A stop loss is one example of a way to control losses, perhaps the > most fundamental .... there are others. > > > However, Can we trade -off between loss and profit??? > > ex: if we invest into A (it's price may go up 80% and may go down > >20%, > > otherwise, if we invest into B (it's price may go up 30% and may go > > down 70%) Should we should choose A, ect > > Yes.... there is always a trade off between risk and reward. > This is called the payoff ratio == ave win/ave loss (aW/aL). > > As I mentioned, it is also necessary to consider the number of > wins/number of losses == Wins/Losses (W/L) > > Mathematically combining the quantity and quality of our wins > produces a useful metric that summarises the relative performance of > our system (the series of trades we have made using a set trading > rules). > > ProfitFactor == W/L * aW/aL > > IF you look in AB >> AutomaticAnalysis >> report you can see the > Profit Factor for your latest backtest. > > There are a lot of other metrics there that can be used to compare > the relative merits of your trading system. > > > >(Can AB helps us to follow > > this kind of matters???) > > Yes, AB is a specialist program for testing and comparing trading > systems .... since a system is based on a trading concept it follows > that it also tests the concept. > > If you are new to trading you will need to combine some reading and > thinking to come up with trading ideas and then test your ideas in AB > to see if they would have performed will in the past. > > There is quite a bit of reasonable free material on the net and the > forum can also recommend some books as you go along. > > brian_z > > > > --- In [email protected], "lyhungvpsc" <lyhungvpsc@> wrote: > > > > Thanks brian_z, > > > > Thanks for your deep and details answers! > > > > As you said, with AB we can only use stop loss feature. > > > > However, Can we trade -off between loss and profit??? > > ex: if we invest into A (it's price may go up 80% and may go down > 20%, > > otherwise, if we invest into B (it's price may go up 30% and may go > > down 70%) Should we should choose A, ect (Can AB helps us to follow > > this kind of matters???) > > > > I'am newbie so my thinking may be silly :D but it may help others. > > > > (I'm not nature English speaker also :D So my writing maybe > difficult > > to understand) > > > > Thanks again > > > > > > --- In [email protected], "brian_z111" <brian_z111@> wrote: > > > > > > Hello lyhung, > > > > > > Well that is a very deep philosophical question ... are you a > > > philosopher by nature ... if not a complete answer would be > wasted? > > > > > > In trading, everything that can cause financial loss is a risk to > be > > > considered: > > > > > > - data delay or errors > > > - broker slippage > > > - insider manipulation > > > - events (earnings change, company news etc) > > > - computer/internet 'error' > > > - incorrect strategy > > > - anlytical error > > > - correlation > > > - psychological error > > > - portfolio diversification > > > - and many more > > > > > > All need to be considered and emlinated or contained. > > > > > > Your capacity to identify and control risk is a measure of your > > > trading stature. > > > > > > Much of that has to be done outside of AB. > > > > > > However you probably would like a simple definition. > > > > > > It is your ave loss per trade (based on your stop loss) * the > > > probability of losing per trade i.e. if you have a guaranteed > stop > > > loss of 2% then that is your risk per trade AND the risk to your > > > portfolio is based on the probality that you will experience a > run of > > > losses. > > > > > > brian_z > > > > > > > > > > > > > > > --- In [email protected], "lyhungvpsc" <lyhungvpsc@> > wrote: > > > > > > > > How should we use AB to consider the risk??? (RISK and DECISION > > > > ANALYSIS @RISK) > > > > > > > > > >
