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Re: Margin Warning
[Re: jcl]
#443775
07/24/14 12:08
07/24/14 12:08
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Joined: Jun 2013
Posts: 1,609
DdlV
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Re: Margin Warning
[Re: jcl]
#447325
12/04/14 16:03
12/04/14 16:03
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DdlV
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Thanks jcl. I believe I understand what you're saying - however, I'm still confused. This is Z3, so RISKLIMIT is whatever it sets. I understand that the maximum risk printed is based on the Margin & Risk slider settings, not the account's balance. Where I'm lost is in the "close the loop", "total consistency" aspect. The Margin & Risk settings were determined via Testing to the Capital available to invest - the initial balance. This CR reflects the maximum drawdown, which by definition can't exceed that CR = initial balance. Therefore, if all is consistent, how can the printed risk for 1 trade exceed the account's balance?
Separately, I'd appreciate your comment re. the Margin setting to use when transitioning between accounts & before the old trades are closed on the old account, as in the example above.
Thanks!
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Re: Margin Warning
[Re: jcl]
#447332
12/04/14 17:53
12/04/14 17:53
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DdlV
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Thanks jcl. Re. moving a system to another account: Please re-read the example above. The question was not about how much money to leave in the old account. The question was what Margin setting to use on the new account when only part of the balance has been transferred. Re. risk per trade: I'm very well aware of the need to monitor - I've already had to add funds twice to (narrowly, barely) avoid margin call on Z5. My question is about stepping back and looking at the "big picture" interrelationships of the various factors/parameters and how they all "hang together" consistently. If I've Tested to determine the CR for a given Margin/Risk setting, and funded the account with that CR balance, how then does Z3 open a trade with risk exceeding the CR/balance? That seems inconsistent to me, and makes me suspect the veracity of Test results. Thanks.
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Re: Margin Warning
[Re: jcl]
#447351
12/05/14 16:36
12/05/14 16:36
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DdlV
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Thanks jcl. Re. new account: That makes sense and is easier than Testing. Re. risk: What's confusing me is perhaps encapsulated in your 3rd sentence. The balance is actually directly related to Test results and CR - in fact it's exactly equal to the Tested CR. That's why I don't understand how the printed risk of this single trade can exceed the balance = Tested CR. Take "balance" out of this and just focus on CR. There seems to me to be a disconnect between the statistical simulation and its results vs. what Zorro then does trading using those Tested settings. How can the Tested CR be considered the "safe" or "worst case" value to trade the system if a single trade's risk is sufficient to not only hit but exceed margin call? Thanks.
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