Martingale principles
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I can also add that the martingale system:
in an average market situation, makes money which would not be the case not betting.
in a good market situation, makes less money than without betting, because you need to enter positions with little money due to the fact that the betting series must begin with very little bets.
in a bad market situation, makes you loose more money than without betting because it evolves exponentially.
There is then 2 worse situations an 1 better, just that the 1 situation(average) is applicable 2 times more often, on a random market. -
@seb-0 It's exactly like that:
If you have a good reversal/momentum entry/exit logic you are wasting it by using martingale because the bad positions always get a fat leverage/size and the best positions get a small one. It's not smart at all.
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@AlphaOmega I agree that backtesting is not good enough by itself, but it's x1000 times better than just assuming (hoping) that something works and then put money into it without any kind of analysis.
The way I judge experts now is not how good or bad these are in isolation, but how good they are in relation to each other in specific markets and situations, and how they would be able to complement each other when one of the pieces fail.
Markets change constantly and rigid strategies lose their edge and start underperforming when new volatility and structure regimes arise. This is why we also have to adapt and improve our strategy continuously.
The new AI technology will make trading A LOT harder than it already is.
