Topic: 31 days later.. Testing own strategy (Read 264 times)

It is good that you have shared what you have learned. What I think is 31 days is a very small timeframe to test a strategy and wrap up a result. A strategy should be tested for a minimum of six months before you can apply it to the real market. This timeframe depends on whether the tester himself is satisfied with the test and the result. TBH you won't get a better result by only testing for 31 days.

My strategy works in the spot market and generates returns in both bearish, bullish, and sideways markets, with a very conservative risk management approach. You mentioned that the assumed risk isn't justified. Were you certain that in 2020, BTC would surpass $60,000?
What I aim to achieve with this strategy is to consistently generate monthly and yearly returns that can be measured sustainably over time, regardless of market fluctuations. The strategy focuses on medium and long-term consistency

To publish my strategy on TradingView, one needs to be a premium user, which comes at a cost of $60 per month. I'm also looking for feedback from at least 20 individuals as part of a pilot test to identify areas of improvement in my strategy. This feedback is crucial to refining my approach. I appreciate any interest or participation on your part in this process.

GOOD! Now from the period of 2020 to 2023, compare your performance vs. a Bitcoin Buy and HODL strategy using the same amount of starting capital, $1,000.

If your performance is lower, then you need to improve the strategy, and/or add the more volatile shitcoins to trade. Many shitcoins usually perform better than Bitcoin during the bull cycle simply because "reasons". That doesn't mean they're the bes though.

If your perfomance is only slightly better, then if you ask me, the risk taken by a more active trading strategy is simply not worth it in my opinion.

I'm not familiar with how TradingView rewards its publisher, but do you really need to pay them and must have at least 20 subscribers before you make a profit? The numbers seem to come out of nowhere. I never heard similar things from others who create new threads and wanted to share their strategy with others. Personally, I also feel less inclined to join a random group just to know if it works or not, especially if the members are so few.

Hello, I have downloaded the backtest data so that you can better visualize the strategy I am implementing. The backtest covers the period from 2020 to 2023 with a capital of $1,000. In the following link, you will find the spreadsheet where everything is more detailed. Thank you very much for your feedback.https://docs.google.com/spreadsheets/d/1TCRy0wyyBBvGvz8p2wEyB2RcslsJvZ9eN0gGrHWJOjo/edit?usp=sharing
PLEASE CHECK THE BACKTEST

I want to share the tool I've developed with the community, and the Telegram group is for that purpose, to address questions about my strategy. I need more than 20 people to be able to publish the strategy on TradingView and not waste money in vain. If you want to try it, please join the Telegram group, and when we reach 20 people, I will upload the strategy along with a manual for its use. Thank you.

Thanks for sharing, updating, and taking us on your trading journey using your own trading strategies. I am an occasional trader even though I have the theoretical knowledge of trading so I am happy to see someone actually put in practice trading.  

I was wondering, how how have you been trading for and what has been the most valuable lessons from trading that you have learned?

I'll definitely check your telegram channel.

Those that took their time to carry out their personal research always, find it easy to identify some new strategies that will add value to their trading that will help them to achieve surplus income in the future. I think, many traders are still using some professional strategies in the community to make a good income from the market, because they tested it in the bearish season some years ago and it started manifesting in the bullish season that is giving those that applied such strategies joy today. I believe many new traders are still learning new things from crypto trading that will soon make them experts in crypto trading in a way losses will be far from them.

Why not you would really be needing to post up your free trade tips on here or with this thread rather than on requiring people to join up or would go into that TG group? Not all would really be that too confident
on doing such thing or would really be hesitating on doing that step on using TG just to get some trading tips. Actually it isnt bad if you are really that making your own strategy and making some backtesting for a month and see your expected results. Please do bare in mind that not all that the results you are seeing on backtesting would really be precisely be happening once you do touch up the real deal. Volatility could easily fucked you up and could really be messing up on the strategy that you had made. You cant really just that make yourself that too confident that it would really be definitely 100% gonna work in case you would really be applying it.
I do somewhat agree that 22% in a year is really that small when you are dealing with crypto space and just trying to look around then it would really be just that peanuts.

We do have our own approaches when it comes to trading and if you do see that it do satisfies you then do it, dont get hesitated on whatever other people would be saying as long you do see that it works for you
then it should be just fine. We are really doing our own things just to survive this unpredictable market. There's no way that there's such thing about precise prediction or methods because
it cant really just that so easy.

People who struggle get their position as some people worked hard so they get their gift or their reward I can say in other words. But the people who just look at others and don't have any intention to learn from themselves and get forward that person always stuck in their position which was ever.
The best way in trading to move forward is to learn from yourself whether you have less knowledge it doesn't matter,  a time will come when everyone will learn from you.

Strategies in trading play an important role, if someone is using a single strategy again and again, and he is continuously failing in his trading and getting losses, he must have to change it otherwise there will be more losses if he doesn't think about it and change his way of trading. Mostly people traders lack strategies that's why they lose.

There is no problem with playing with your own strategy. But when greed overcomes your emotions, then no strategy works the second time. I am saying this from my own experience. Yes I will be really happy if you make good profits from it. But you need to be careful while using a strategy to get high profits in short period of time. Use stop loss and proper risk management before using the strategy. At last invest that you can afford to lose.

The second thing that you said is correct. He is the one's that will share his trades. He also said this at the end of his post. Yeah trading groups are like that but isn't it great? I mean there are groups which allows you to show case your talent. You should feel great when someone use it and they experience a positive result and you don't know, they might also give you some tips (money), as a way of saying thanks.

If you are a beginner, you can also do the same thing or you are the ones who will seek for strategies, signals, etc... Maybe there are also a strategy which requires a trader to actively/closely monitor the market? There are bots but sometimes manual is better.

I love that you have done well to learn and even went ahead to be practical about it. Your knowledge may have been gotten even before joining this forum and it is a privilege for many of us to actually see someone who is enthusiastic enough to share with us their current strategy and proof of work(POF).

 Have you tried using bots in your trading?
 If you do, with a return of 0.06%, you should expect no less for a duration even if there's a dip. Bitget has this bot  features.  
With your current mindset, the 0.06% I believe is a minimum profit you get and if you DCA along with your mastery of this strategy all you might need to bother about will be the best wallet for safe keeping, the right percentage to DCA, the right percentage to reinvest, the right percentage to spend on necessities too many to count.
 It's the yuletide in view, so expect market shifts and sudden dips, but don't be too scared for BTC or any other crypto, if there's a trade limit set in play.

I believe not. Making 20% annually, by doing a more active style of investing, and taking more risks is actually worse compared to a low-time-preference investment in Bitcoin. Measure it by taking the annual return, positive or negative, of merely HODLing Bitcoin for the last five years, then get the average.

HODLing is lower risk than active trading, and I'm confident it will give the HODLer a higher return for his/her Dollar vs. the 20% annual profit from a more active strategy. If a person can't outperform the HODL, then just HODL.

I really like your approach. Why?

1. You implement money management. Many do not work with money management, dca or something like that.
2. It's your way to trade - this means you choose the time management that fits to your life.
and last but not least, you are on winning side.

All you have to do is observing your returns and improve where necessary. For all people saying 20% is not much: Returns may grow exponential. If you keep your 0.06% daily you will have a multiplier of about 8.9 after 10 years (calculated without further investments). It's up to you to decide it's a good return or not. I agree, if you say it is.

20% annual profit is good, it is better than losses. If you are trading, as you are increasing your risks, you are increasing the probability of you to lose. With low amount of money, likely you may want to use leverage which is riskier. It is good to go slow in trading than thinking big that can result to losses.

Indicators has not be helpful for me like this but averaging has helped me to later make profit in the opened position that I was losing before, but because I started small and average it as the price against me, I later won big. But this is also risky if not done carefully.

Strategies and price analyses are the most important part of trading.

OP, it's hard to make an annual projection if the data used is a mere 31 days. Plus what's your margin for error? I'm confident that you can't truly calculate any with accuracy because your data points are so low.

But what could help you is to back-test your strategy through the use TradingView's "Strategy Tester". If you DYOR there are many educational guides such as this one, https://www.financialtechwiz.com/post/tradingview-backtesting

Although, intra-day back-tests are not available for free. But TradingView does have a 30-day free trial. Plus for plebs, it's probably better to use lower time preference strategies.

Good job, I see that your strategy is working well so far, but a final statement cannot be given until at least a year has passed to see how it works in conditions of different market fluctuations. It would be nice to get 22.52% over the entire year.

I do not advise you to try this strategy on the future because the risks are high. It is true that profits can reach 60-70%, but the risks will also increase by a large percentage, so it is better to continue with spot trading in the long term with less risk.

So what is your telegram group for? to learn from each other about the strategy you are testing or is it a place where you share when taking positions in buying or selling trades? I'm not really interested in joining any groups about trading because they are usually just places to share signals.
As long as you trade in Bitcoin and the spot market, the risk can be very regulated because even though the price of Bitcoin has decreased, in some time it will bounce back, and you are right in saying that if we have a strategy then we don't have to stay in front of the computer to pay attention to the charts because with that strategy Usually, traders will know when to open a position.

Most important detail you've omitted so far is your stop loss, whether you have any, what's the maximum drawdown / month and overall according to your parameters. What are the backtest results if you have any, would be interesting to see how strategy performed over the years when Bitcoin was trending down.

20% / year, even on spot might be counter-productive if your underlying instrument has achieved 200% in the same time frame...

It would have been more better if as many as possible traders can also take their time in making some discoveries on new strategies and develop them for their personal use and for others to give a try on, so many people have already put in efforts in many ways that make us have the experience in what we are now using today which some of them are what we called trading indicators and many more.

Do you have a specified amount of profit or stop loss you are willing to take per trade or is that all random for you?
Secondly, for the returns you made after one month, I was quite surprised that the trading fees did don't affect your profit that much.

I like this idea of trading challenges or journals. Keep up. I have been thinking of creating my own though I am still inconsistent because of lack of enough screen time lately.

It is natural that not everyone will comment the same. Some people will support your 20% annual return considering its aspect and some people will not consider 20% return as the right return because of the additional risk of money. Two different ideas, but both are correct.  We should be satisfied with twenty percent out of 100%. If you have enough confidence in your trading skills then I think twenty percent is a lot of return. On the other hand, if $20,000 is invested, the return at the end of the year is only $2,000, so here I have risked $20,000, since I have risked money, this money could have been lost, so considering this, 20% is a bit less. 20% returns will be fine when you have full confidence in your trading strategy.

In the first place, you don't really need to stay in front of the computer all day, because that depends on the timeframe you set up. Now, if your set-up is every 3 hours, that means every 3 hours that pass, there will be a new candle formation on the chart, either buy or sell. And the one left by the line on the candlestick is called the wick.

With this strategy of trading, it is really necessary to understand that you really have to. It's really not possible for you to make unfounded predictions; that's the truth. So, if you earn even 0.5%, it will still be a profit. You will only see that there is no profit in your way if the profit you see is zero percent or below.

It's been 31 days since I started testing a strategy I designed in TradingView, applying my knowledge in trading and investments. This is a continuation of my previous post https://bitcointalksearch.org/topic/is-a-20-annual-return-good-5468812 in which I asked whether achieving an average annual return of 20% was considered good. There were several interesting comments, with some people saying it's a good return for spot trading, while others felt it's a very low return due to the high risk and volatility in the cryptocurrency market. Some mentioned that for a small capital, it might not be worth the effort for such a small gain. I'd like to address some of the points that came up in the post.

**Risk Management:**
The strategy divided my capital, and the  involves making multiple purchases as the price drops, averaging the cost, and selling when a certain profit-taking level is reached. In the Google Sheet I'll share, there's a sheet defining the risk and why I consider it a medium-to-low risk strategy.

**Trading Operation:**
My strategy is designed for Bitcoin, but it can work with other cryptocurrencies. I primarily use a 3-hour timeframe.

**Time and Management:**
You don't need to be in front of your computer all the time. Once I get a signal on TradingView, it sends a notification to the app and email with the quantity of BTC to buy and the price. Placing the buy limit and sell limit orders takes just one minute, which I find manageable for a 20% return.

**Performance in 31 Days:**
I've completed six trades, including both buying and selling. Over these 31 days, I've achieved a return of 1.91%, which translates to a daily return of 0.06%. Projected over a year, that would be 22.52%, but this can vary based on market behavior. It's important to note that this is in the spot market. Can it be done in futures? Yes, and with leverage (2x or 3x), you can easily reach 60% to 70% returns due to compound interest. However, I prefer the spot market as I see it more as a long-term investment.

Here's the link to the spreadsheet https://docs.google.com/spreadsheets/d/1TCRy0wyyBBvGvz8p2wEyB2RcslsJvZ9eN0gGrHWJOjo/edit?usp=sharing where you can see all the trades I've made, a screenshot of how the strategy operates on TradingView, and a sheet of risk. I'll provide another update at 60 days and continue until I reach 180 days, which will conclude my testing, and then I'll consider adding more capital. Feel free to ask anything...

Edit
I've created a Telegram group where I'll be sharing my daily trades. It's free, so feel free to join if you'd like. https://t.me/CryptoBeeStrategy