@unlax is a long-time Forex trader from Singapore, started manual trading in 2008, switched to automated trading in 2011, provided FX Signals on many copytrading platforms. He is also a programming instructor by profession.
In addition, he had participated in the imTrader Trading Contest S9 and is in 3rd place in the Large Account Group of Global Division. We are glad that he participated in this interview and shared his experience with you in FOLLOWME community.
1. What kind of traders are you?
Day-trading, quantitative technical analysis, fully automated system trader.
2. What do you think is the most important thing to make a long-term profit steadily?
Risk control. Learn to achieve capital preservation first, then improve on the ROI. This requires strict implementation of stop loss for each order, and control of max drawdown of the account. If a consistently profitable system experiences a big drawdown (e.g.20%), it indicates that the market condition is abnormal. You should suspend trading instead of doubling positions without stop loss to seek recovery. During the non-trading period, improve your model to accommodate the new market conditions, and resume trading only after the forward test is profitable.
3. Which one do you prefer? Method indices or graphics?
Technical indicators. Now I rarely look at charts, I optimize the parameters of various technical indicators and backtest with >10 years of historical data to derive at a consistent quantitative model.
4. What’s the most confusing thing during your trading?
Those unforeseen situations still occur no matter how hard you try to risk manage, such as broker re-quotes, disconnections, server downtime, etc.
5. Do you do the trading full-timely?
Currently yes. Trade for a living has always been my dream. Due to the COVID situation, I took the opportunity to go full-time trading. It may end up in vain, but not trying will never succeed. My trading is fully automated, so there is no conflict in time management whether I took a job or not. Of course, it will affect working mood when there are trading losses LOL.
6. What do you think is the difference between you and the other traders who have tried but failed?
I dare to admit my mistakes. Since I started learning day trading, I have adhered to the principle of strict stop loss, so doubling positions without SL (Martingale/Grid) is not in my dictionary. Hence my learning path is relatively bumpy, as those who have used strict SL should know that this approach is very difficult to be profitable. But the accumulative experience I gained doing quantitative analysis has changed my trading trajectory significantly.
7. When we are choosing the categories, some will choose the bigger wave range one, some will choose the smaller one, what about you?
80% mean reversion, 20% trend following. Some pairs are more suited for trend trading (such as JPY pairs), most are suited for mean reversion, and some has both (in different time periods, such as EURUSD). Trend trading has a higher profit-loss ratio but a low rate of occurrence. Conversely, mean reversion trades occur often but the P-L ratio is low. So I select the best entry/exit signals from >10 pairs with a roughly 80-20 ratio of reversion vs trend trades.
8. Some people say that the trading system or even huge profits can be copied, what do you think? Do you think if someone copies your trading system directly, will they be able to make stable profits?
As an algorithmic trader, I certainly believe that the trading system can be replicated. Any consistent strategy can be coded in algorithms, you are limited only by programming skills. Does a highly profitable system exist? LOL, huge profits and huge losses are two sides of the same coin, you can’t have a highly profitable system with little risks, there is no Holy Grail in trading.
9. Do you usually visit the community? What data or content will you be interested in?
Visit the community very often, mainly to socialize and gossip LOL. The main reason is that there are not many good articles, or I don’t care about technical articles anymore. I found that there are many salesmen in the community doing marketing, bragging, and posting trade profits. This needs to be improved.
10. When will work for the psychological factor?
Human emotions are the biggest weakness in trading, so I choose to eliminate them with fully automated trading. So the question is how to break down the psychological barrier and completely trust your system and not interfere with it. Well, I guess you need to have a good track record to get that confidence.
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