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Bird watching in lion country （BWILC）炒汇法的发明人 Dirk du Toit
曾获2007某炒汇竞赛冠军。Xaron 是他的学生之一。Xaron 今年十一月开始不断公布他的
交易账户细节，他十一月的回报为 57.52%。下面是 Xaron 对 BWILC 方法的简介。
Xaron：
I'm a fundamental trader with some technical background. But the only technical
stuff I use are support and resistance zones (not lines!). Personally I don't
know how the news come out like any other trader out there. But a single news
don't change a long term fundamental trend!
Leverage
I think the most important thing from the book is to use low leverage and that
gearing up can break your neck even though you might be right in the long run. Personally I use a leverage of 0.5:1 up to 5:1 depending on the near to a support/resistance and the position within the grid.
Entries
Second is that the entry itself is not that important. It becomes more and more
important the higher the leverage is you use. The same is true for spreads and
slippage. I don't care at all about that stuff. Using low leverage allows you
to optimize your entry price by using cost averaging. But isn't that adding to
a losing position you might ask? Well, actually no because you should differ
between an entry and your trade.
If trader A enters with one single position of, let's say, 1 lot, he's already
very limited and obviously has to know exactly where to set his stop in terms
of his risk management. That's the way most traders do it and most of the systems
here work. Let me say that there is nothing wrong doing it that way at least if you
can handle it. Personally I couldn't.
Trader B (yes, that's me) split this position size of one lot into several entries,
let's say 0.1 lot each. So I start with 0.1 lot and hey, usually the first entry isn't the best and you always get better prices later so I add to that position and might end finally as well with one lot but a much better entry price. I know, if it goes into my direction immediately, Trader A will have more benefit from its single position but for me cost averaging is a very important thing. Just don't see it as adding to a loser but as building up a position where another trader would enter with one single entry.
Another way of doing this would be the heavy usage of limit orders. That's one thing
I'd like to use more in the future as I sometimes miss some nice entries around
supports and resistances being just too lazy to add a simple limit order,
but that's another story.
Median Grid / Comfort Zone
Right, you already know that we have our median grid (I call it my comfort zone),
within trades are placed. The nice thing about this approach is that it both works
in ranging and trending markets as long as your directional bias is correct. Let's
say our grid is really big with a size of 800 pips. We divide this grid into 4
quadrants: Q1, Q2, Q3, Q4. Let's take the EUR/USD currently with a grid of 1.42-1.50
Q1 would go from 1.42-1.44
Q2 would go from 1.44-1.46
Q3 would go from 1.46-1.48
Q4 would go from 1.48-1.50
The size of the grid is just defined by the volatility and usually sized 3-6% of
the currency pair. You just want to have a size which is within possible move sizes
within the following weeks/months without the need to adjust is permanently.
Of course you have to use less leverage with a wider grid. As long as you're within
your boundaries it should not be necessary to close any trades with a loss!
That's a thing I sometimes not do but it's the way it should be.
So in the lower quadrants it's ok to enter with bigger positions,
let's say 2:1 - 4:1. It doesn't make any sense to enter more than 2 positions
within one quadrant. You don't want to end up with 4 positions in Q4 and 6
positions in Q3 only to see a drop to low Q1 levels. That's not a good feeling,
believe me.
In Q4 I would only add one position at all with 0.5:1 up to 1:1. You might
even enter shorts there even though your bias is up, that's just an additional
part to play the range game.
If you add let's say two positions in Q1 then ride at least one of them to Q3 or Q4.
No need to hurry, we've plenty of time. The other positions are for shorter profit
targets like 30-60 pips (by just exploiting the randomness) where you can try to
reenter at better prices again. Just have always one "long runner" in your list.
If you get into Q3/Q4 it becomes trickier. Again, just avoid to have too many
positions there. I almost always have a small 0.5:1 position at the top to benefit
from a possible strong break to the upside. If it goes down again it doesn't hurt
so much due to the low leverage. You can use cost averaging then effectively.
Grid Adjustments
So as long as we're inside the boundaries, everything should be fine. Use low leverage,
don't enter too many position and go even short in Q4 if you see an opportunity.
But what is to do if our boundaries are broken? Let me say first that for a break
it's necessary that the price stays at least all 3 sessions beyond the boundaries
so a simple break doesn't count!
The easy part is when the grid is left into our directional bias. In that case we
lift it up using a half grid size to give it some room to the upper side (remember,
we don't want to make adjustments that often!). So in our example (1.42-1.50)
we would make an upmove of 400 pips to 1.46-1.54.
The more difficult part comes when our grid is left against our direction. In that case
we have to shift it down, usually a half grid size as well, so down to 1.38-1.46
in that case. The more important thing is what to do with the open positions?
We have two options: Close some or hedge them. If you hedge you get some time to
rethink everything without watching your losses become bigger and bigger. Sometimes
it's just necessary to close positions with a loss. Due to that approach your losses
might be bigger than your winners (that's why it's important to have some long run
positions from Q1/Q2 with higher leverage!). But losses are part of the game, so if
you have to close some positions, always close those positions which are most out of
the money, because those positions have the most less chance to become profitable again.
Usually you will close those 0.5:1/1:1 trades (from the formerly Q3/Q4) but can
benefit from your formerly Q1/Q2 trades which might be higher geared. As long
this is a single event and not a trend change (with further grid adjustments),
everything should be under control.
Those grid adjustment in the "wrong" direction shouldn't happen that often.
If so, your directional bias is obviously not correct.
Managing the drawdown
You should know in advance how big your acceptable drawdown is.
It doesn't make sense to allow let's say 30% and start actions if it gets there.
If your acceptable DD is 30% you have to start counter measures around 15% to be able
to handle your positions if it continues to go deeper (by closing or hedging). There
is no need to feel pain by watching your positions going into the red deeper and deeper.
If you can't sleep at night your leverage is obviously too high!!!
Summary
That's basically all. I have a directional bias, buy the dips and use multiple
entries and cost averaging, so it sounds more like investing that trading, mhh?
That directional bias comes from the underlying fundamentals and a break of a
neckline of a H&S pattern isn't a change in the direction of the trend. I enter
slightly bigger positions in the low of my comfort zone and I'm more careful to
enter one at the top of that zone (I often just stick in a very small
one (0.25:1-0.5:1) to keep in touch if there is a ralley).
So actually I don't look at charts that often, I enter here and there around
supports with low leverage and don't use stops. If it goes against me, well,
cheaper levels to buy (all in my comfort zone!!!). So my risk/reward ratio is
undeniable scary regarding the TP:SL ratio but how often did you get stopped
out only to see it continue in your direction? Again, that doesn't mean to let
loser trades run forever against you! It's just all about probabilities. If you
use a tight stop you just get stopped out due to the noise in the markets.
I tried to trade 5m charts in the past but I didn't really get it. Now I'm much
more relaxed and don't have to glue to the screen the whole day... |
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狗仔卡
发表于 2009-11-27 07:56 PM
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发表于 2009-11-27 09:39 PM
