First of all a big compliment for this forum, i am lurking a couple days now and i have read a lot of good topics and reactions !
A small introduction before my questions (as it might be relevant). I am a system programmer with a lot of programming experience and a lot of interest in the currency market. I am developing and testing a lot of trading systems, most of them are based on books i have read. and idea's of other people.
All the testing (backtesting and forward also) is done on my own programs.
I am doing this for 6 months now and it seems that i have a nice system that gives me an average of 14 pips per trade (without commissions, slippage etc).
I have tested this over 10 currency pairs over 3 years. on average i have 30 trades a week. (without piramiding etc, just 1 position per currency pair open).
I am planning to test this via an API in the following month on a couple demo accounts for brokers that allow API access. to see what to expect for slippage etc, the system does not trade news etc active.
Please understand that i am not here to shout how good the system is or how good i am.
OK, here are a few questions i have :
1. If i take for example the EURUSD pair and i substract 2 or 4 pips (roundtrip) per trade, i still have a lot of profit. On average 3 trades a week with 12 pip profit. With a margin of 100:1 it seems that i could make 36% per week for the price/amount of lots i buy.
However if i see all kind of funds and statistics it seams that a lot of funds have a performance of 20% a year or lower.
if i believe the numbers it seams like my calculations must be incorrect, i dont believe i am some sort of genius or that i can outsmart the market, therefore i am really interested in some feedback, is it really true that 20% or more a year is outstanding ? or are my calculation incorrect and for example the EURUSD pair has a (lot) higher spread or more slippage etc.
Another question is what amount moves the market (very rough) I saw some threads about this and googled sometimes, however almost all the answers state that a daily turnover of the forex market is around 3-4 trillion a day. This is offcourse (i think) spreaded over a lot of different currency pairs. So for the eurusd pair does 10Million or 100Million a fair amount to move markets a little ? I do not expect to trade this myself but it was more a question to understand the forex market better.
Thanks a lot for the input !
A small introduction before my questions (as it might be relevant). I am a system programmer with a lot of programming experience and a lot of interest in the currency market. I am developing and testing a lot of trading systems, most of them are based on books i have read. and idea's of other people.
All the testing (backtesting and forward also) is done on my own programs.
I am doing this for 6 months now and it seems that i have a nice system that gives me an average of 14 pips per trade (without commissions, slippage etc).
I have tested this over 10 currency pairs over 3 years. on average i have 30 trades a week. (without piramiding etc, just 1 position per currency pair open).
I am planning to test this via an API in the following month on a couple demo accounts for brokers that allow API access. to see what to expect for slippage etc, the system does not trade news etc active.
Please understand that i am not here to shout how good the system is or how good i am.
OK, here are a few questions i have :
1. If i take for example the EURUSD pair and i substract 2 or 4 pips (roundtrip) per trade, i still have a lot of profit. On average 3 trades a week with 12 pip profit. With a margin of 100:1 it seems that i could make 36% per week for the price/amount of lots i buy.
However if i see all kind of funds and statistics it seams that a lot of funds have a performance of 20% a year or lower.
if i believe the numbers it seams like my calculations must be incorrect, i dont believe i am some sort of genius or that i can outsmart the market, therefore i am really interested in some feedback, is it really true that 20% or more a year is outstanding ? or are my calculation incorrect and for example the EURUSD pair has a (lot) higher spread or more slippage etc.
Another question is what amount moves the market (very rough) I saw some threads about this and googled sometimes, however almost all the answers state that a daily turnover of the forex market is around 3-4 trillion a day. This is offcourse (i think) spreaded over a lot of different currency pairs. So for the eurusd pair does 10Million or 100Million a fair amount to move markets a little ? I do not expect to trade this myself but it was more a question to understand the forex market better.
Thanks a lot for the input !