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Capital Slider questions #476769
03/29/19 18:34
03/29/19 18:34
Joined: Mar 2019
Posts: 11
S
Smallz Offline OP
Newbie
Smallz  Offline OP
Newbie
S

Joined: Mar 2019
Posts: 11
Hi all

I have a question regarding the adjustment of the capital slider.
Please see below math/thoughts.

At the start, the Capital slider setting is at 9'000.
The Starting Capital shall be 14'000.
Let's look at the following scenario:

The system makes a profit of 1'000. Consequently, I have made 7.14% on my balance, which means (according to the square rule), that I can increase the capital slider by a factor of 1.0351.
That would mean, that my new capital slider position is now 9'000 x 1.0351 = 9'316.

So far so good?

Now, the system is trading with this second capital slider setting at 9'316 and...let's assume, that after some time, the system has made a profit of 1'100.
As a result, the account balance is now at 16'100 and the total profit is 2'100, which is 15%. The square root says, that I can increase the capital slider by a factor of 1.0724 now.

Question: Do I go ahead and multiply the initial capital slider setting of 9'000 by that factor of 1.0724, OR, do I take the second capital slider setting of 9'316 and multiply it by 1.0724?

Many thanks for your help in clarifying this!



On a side note: What is the recommended "pace" at which the capital slider should be increased? In other words, how would it look like if it was automated?
Does it make sense to increase it (of course by following the square root rule) at every new high, that the balance makes? Or is there a specific amount of time one should wait so that it can be safely increased?


Thank you all!

Last edited by Smallz; 03/29/19 18:36.
Re: Capital Slider questions [Re: Smallz] #476771
03/30/19 06:44
03/30/19 06:44
Joined: Jul 2000
Posts: 27,219
Frankfurt
jcl Offline

Chief Engineer
jcl  Offline

Chief Engineer

Joined: Jul 2000
Posts: 27,219
Frankfurt
You multiply with the initial setting. The pace has not much effect on the returns, it's enough to adjust the slider any month or second month.

Re: Capital Slider questions [Re: jcl] #476779
03/31/19 10:16
03/31/19 10:16
Joined: Mar 2019
Posts: 11
S
Smallz Offline OP
Newbie
Smallz  Offline OP
Newbie
S

Joined: Mar 2019
Posts: 11
Originally Posted By: jcl
You multiply with the initial setting. The pace has not much effect on the returns, it's enough to adjust the slider any month or second month.


Thank you JCL.

If I was to top up the account with a fixed amount of money per month (say from my salary) then this should be treated like trading profits, correct?
Meaning: 500 USD wired to the account or 500 USD in trading profit are the same in terms of increasing the capital slider, right?

Last edited by Smallz; 03/31/19 10:17.
Re: Capital Slider questions [Re: Smallz] #476788
04/02/19 08:13
04/02/19 08:13
Joined: Jul 2000
Posts: 27,219
Frankfurt
jcl Offline

Chief Engineer
jcl  Offline

Chief Engineer

Joined: Jul 2000
Posts: 27,219
Frankfurt
Yes, when it's a fixed monthly amount, treat it like a profit. Anything that grows proportionally to the number of trades is subject to the square root rule.


Moderated by  Petra 

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