--- In [email protected], Graham <[EMAIL PROTECTED]> wrote:
>
> this automatically sizes the trade for current equity in a
backtest
> positionsize = -2*margindeposit/((BuyPrice - SL)*pointvalue);
> This is 2% of backtest equity adjusted for the risk of the trade,
which is> the (trade price/loss in real dollars) per contract
>
Hi Graham,
of course I completely trust your coding, but.... I don't understand
how it works
It seems to me that your formula's numerator takes 2% of current
equity, and multiplies it by margin deposit (in Dollars) before
dividing it for the 1lot risk in dollars ( formula's denominator)
Example:
Equity = 50000
Margin deposit = 1000
Max risk 2% of equity, that is 1000 $.
Buy price = 55
Stop loss = 50
Point value = 50
Isn't your formula doing (1000*1000)/((55-50)*50) = 4000 (instead of
4 lots)??
Why could not simply be:
PositionSize = -2/(BuyPrice-SL)*point Value);?
Many thanks,
Angelo.
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