Boring Review – January 2023

January is over, and it is time to recap and gather statistics on my trade strategies. For simplicity, I call them The Boring Strategy 1 (TBS1) and 2 (TBS2). I trade it on two pairs – US30 (Dow Jones Industrial Average Index) and GBPUSD(British Pound / US Dollar, also known as “the cable”).

As of today, I trade only TBS1 on my live account. TBS1 has by design a low win ratio and a high risk-to-reward. I am working on a variant of that strategy which has the opposite – a high win rate but low risk-to-reward and you guessed it, that’s TBS2. Once I have enough conviction, I will start trading it (or drop it altogether if it turns out to be useless). I am developing TBS2 as I want to trade it on prop accounts, which generally allow only a very small drawdown (a few %) and for that, I need a high win rate. I will further elaborate on win rates and risk-to-reward in a separate post.

Let us start with the raw numbers:

This translates to a win ratio of 13% for TBS1 on US30 22% on GBPUSD and 53% for TBS2 on US30 and 56% on GBPUSD. In January, summarising my data, TBS1 resulted in 8R profit on US30 and 11R on GBPUSD (that’s a hypothetical 9.5% profit as I risk 0.5% per trade) and TBS2 resulted in only 1R profit on each of the pairs (a hypothetical 1% gain in total). So far so good. Let us see what February brings. I do not draw any conclusions here on purpose (it is too early) but I will do a more thorough analysis end of Q1.

As a side note, my results differ from the above ideal outcome. They are far worse, mainly because I missed A LOT of the available trades, as I was often busy with my 9-to-5 or missed an alert on the phone. That is how trading while having a day job and a family is. It is important to make trading fit your lifestyle, not the other way around.

Now, let’s rock February.