This is by far my most favorite trading tool and I am pleased to share it with you. It provides empirical proof that profitable trading is not solely dependent on a high winning percentage. This tool is one of the features included with the desktop software that comes with my swing trading course. Try it out, I am sure you will agree it is an eye opener.
How to use this tool.
1. Enter the values for Win/Loss ratio and Win Probability (3.0 would be a 3 to 1 win/loss ratio and .50 would be a 50% win probability)
2. Enter desired “Lines Qty” to draw multiple equity curves
3. Click the “Generate” button to generate simulated equity curves
|Frequently Asked QuestionsWhat does this tool show?
This tool simulates an equity curve of your account over the long term after systematically applying known parameters of Win Probability and Win/Loss ratio of trading results. Each equity curve consists of about 385 trades which is a statistically significant sample. The random generator decides (as the market does) with a given probability whether you win or lose in a given trade. The equity curve trajectory is then generated. 100 is the starting point so any lines above that are profitable.
What is a “Win/Loss ratio” parameter?
What is a “Win Prob” parameter?
What is a “Lines Qty” parameter?
What are the “Kelly Val” and “Math Expect”parameters?