My Enhanced Trading Strategy - Three Months Of Testing
In Search Of A Consistent Winner
When it comes to trading strategies, consistency is the apex we are all desperately trying to achieve. A trading strategy that can produce consistent gains, in any market, over an extended period is worth a king’s ransom. Consistency, in terms of days and weeks, is simply not good enough. A trading strategy that can perform and produce over many months, and even years, is what gets me excited.
Then again, a strategy doesn’t operate in isolation. Its execution lies in the hands of a trader. A great trading strategy in the hands of an undisciplined, or emotional trader won’t be of much good either, which is why developing strategies as you journey is a great approach to have. As I recently mentioned, I have been working on an already profitable strategy, in an attempt to enhance further profitability, as well as the risk management of the strategy.
Being a Crypto trading strategy, I am utilizing a strategy focused on the coin amount, as opposed to the dollar amount. In other words, if I allocate 5000 coins as my trading capital, I sell the surplus as profit. If I manage to trade my account up to 7000 coins, I will be able to sell 2000 coins as a profit. This approach was chosen for two primary reasons. Firstly, we will soon be entering a bullish phase, which will automatically increase the value of the trading capital.
I always advocate using Crypto as collateral in a bull market, and fiat as collateral in a bear market. The second reason is that the strategy now becomes a short strategy. Essentially, this incorporates selling coins higher, repurchasing lower, and in this way, ultimately increasing the amount of coins in the account. Due to the nature of the strategy, this dynamic is somewhat softened, in terms of rigidity, due to a multi-position strategic approach.
How’s It Been Performing
Firstly, I haven’t completed the third month just yet, so I am looking at the final month in terms of its current average. Initially, the performance was incredible. However, I chose to lower my risk profile. By doing this, I was able to improve the consistency of the strategy. Unfortunately, reducing risk simultaneously reduces profitability. However, I prefer to have a consistent earner, as opposed to a sporadic superstar.
Even after the adjustment, the strategy has been averaging between 30% and 50% over 30 days. While the risk profile was a lot higher, I sometimes experienced as much as 8% in 24 hours. However, the preservation of capital is more important than gains. Most traders consider gains to be the primary objective.
This is why so many traders enjoy initial success, only to blow up their accounts down the line. It’s also important to note that I am talking about an entire trading account, not isolated trades. Traders often post screenshots of profitable trades. However, these are marginal trades performed with a fraction of their trading capital.
Growing an entire account by 30%, or even 50% per month is good enough for me. Choosing to, or being able to compound these returns would have an enormous effect after 12 to 18 months. Furthermore, this has been achieved with rather modest attention. Increased screen hours could possibly push these figures higher.
Final Thoughts
When I initially mentioned this strategy, I had hopes of eventually being able to utilize it as an actual income source. Considering that I have been able to achieve these results on an ongoing basis, it could well become a reality. It’s been a truly rewarding experiment, and I am super motivated to give it a real push in October.
It’s almost as if this strategy incorporates everything I have learned over the years. It’s extremely multi-faceted and incorporates numerous principles and practices. Anyway, I am off to my trading screen. All the best! Catch you next time!
Disclaimer
First of all, I am not a financial advisor. All information provided on this website is strictly my own opinion and not financial advice. I do make use of affiliate links. Purchasing or interacting with any third-party company could result in me receiving a commission. In some instances, utilizing an affiliate link can also result in a bonus or discount.
This article was first published on Sapphire Crypto.