DoubleStrike (NASDAQ 100) by BigReturns

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tradeoholic

#1
Hi,

DoubleStrike (NASDAQ 100) system equity curve looks good, I like the small drawdown but it seems to start making money very late. Almost for 4 years makes only very little money and since 2012 January has started making bigger profit ? What is the cause of it ? If I subscribe to it will I make such a little profit at the beginning ? In spite of it the monthly return page shows 10-15 % monthly profit from the beginning. I dont understand it.

Can you provide some more information about the system ? How much starting capital is needed for trading it ? Can I trade it with little money for example with $2,000 ? I am curious how much starting capital is needed in order that the $250 subscription fee returns ?

How often should it be traded on a week ? Do you provide signals every day ?

Thanks.
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Eugene

#2
QUOTE:
Can I trade it with little money for example with $2,000 ?

I leave answering the questions to the author, but just FYI: when subscribing to any WealthSignals system, you enter desired account size (which might considerably differ from original size its author is using).
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BigReturns

#3
Hi Tradeoholic!

Thanks for taking interest in my newest trade strategy. Yes indeed, the sample/back testing looks real good.

There are few reasons for what your seeing in the results and I'll try to address them.

1) First, the back-test simulation that I ran started at $50K and we end up with large ending net value after 7 years. When I upload the back-test results to WealthSignals, it scales the starting portfolio down so that ending net value is at the defined starting portfolio for the trade strategy(which was defined at $50K). This makes the starting value of the portfolio very small. This is the way I found WealthSignals to work and believe it's outside of my control.

2) The reason why you see more money being made later in the strategy is due to the 7% equity based positioning. Unlike a fixed dollar trading, as the portfolio grows, we make larger and larger investments and therefore the returns are larger in dollars but still equal in percentage terms. For example, if we start a portfolio at $50K, a 7% investment is $3,500. After a years time, lets say the portfolio value is now $100K (100% return) and a 7% investment is now $7,000. After two years at a 100% return again, the portfolio is now worth $200K and the same 7% investment is now $14,000. As you can see, the investments and corollary returns are same in percentage terms but larger in actual dollars which is why you see larger porfolio growth in the later years.

3) As far as starting a portfolio at $2,000, I'm not too sure at this time if it would be beneficial. The $250/mo. and trade fees might eat you alive, however, if the returns are good it could still work. You may be better off with 49% equity stake to overcome some of the fees. I could back-test a couple of scenarios if you interested - so let me know! (I could publish an additional trade system with those results as well)

I hope this addresses your concerns.
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ashridharani

#4
Hi Big Returns,

In your strategy summary you said:
QUOTE:
- Our signals trades on both LONGS and SHORTS, and does not use limits or stop losses!
Your trades should use limits and stop losses.


Can you expand on that please, meaning if your back test results posted here are without the use of limits or stop losses, but if you are recommending that subscribers use limits/stop losses (presumably at their own discretion), wouldn't their results differ than the actual system results or am I misunderstand it?

Also, I don't know if you had tested your system taking long trades only. I was wondering how much of the performance is given up (on your 7% or 15K scenarios) for those subscribers who may be less comfortable with trading shorts?

Thanks.
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BigReturns

#5
Using limits and stops is typically considered good trading practice. Setting them are at the discretion of the user. Trading variances (timing, priority, and trade cost) would vary between users and WealthSignals system. I don't think anyone should expect their personal performance to be identically to any other user or the out-of-sample results for any trade system.

You can trade just LONGS on this as well. I ran back-test on just LONGs with the same settings and here are the results:

-= (7 Years, 7% Equity, & 50K Portfolio) =-

Trades: ~1,802
Annualized Gain: ~227%
Win Rate: ~86% (Max consecutive winners: 39)
Loss Rate: ~14% (Max consecutive losses: 14)
Average Bars/Days Held: ~11 (win: ~12.2 / loss: ~4.3)
Exposure: ~76

WL Score: ~280
Sharpe Ratio: ~7.65
Profit Factor: ~44.5
Recovery Factor: ~73

-= ($15,000 Fixed Dollar Trades) =-

Trades: ~3289
Annualized Gain: ~88%
Win Rate: ~90.5% (Max consecutive winners: 91)
Loss Rate: ~9.5% (Max consecutive losses: 8)
Average Bars/Days Held: ~12 (win: ~13.2 / loss: ~4.4)
Exposure: ~19

WL Score: ~428
Sharpe Ratio: ~3.6
Profit Factor: ~62
Recovery Factor: ~7168


If there is enough interest, I can either change this to a LONG only trade strategy or create a separate trade strategy.

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ashridharani

#6
Thanks for the information. I for one would be interested in long only as a separate strategy option.
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tradeoholic

#7
Hi BigReturns,

thank you for your replies, I would have some more question. What is the minimum starting capital in your opinion this system is tradeable with (without leverage)? I mean what is the minimum capital with whom the $250 subscription fee returns ? Is this system tradeable with a leverage if let's say I have only $2000 starting capital ? Is there slip between your signals and my position openings ? I mean will I get worse performance because of the slip, or is it not significant ? How often and what time will I get the signals? (Shell I sit during the whole market session in front of the computer, or will I get signals on a specific time on a given day) ? Will I get signals every day, or only after a position is closed (Are several positions opened at a time) ?

Thanks,


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BigReturns

#8
Hey Trade... you have a lot of questions in there.

Minimum capital - I've stated that $50,000 is the starting capital. Doing some basic math ($250mo/$2000) required a 13% monthly return just to cover subscription costs which is very high. At $50K the subscription cost requires one half of one percent (.005%) which is very low. With this being said, its difficult to say the actual minimum requirement because there are still unknown factors like your trade costs. Simulation has shown that you can still do very well at $25K entry point but anything less I would think is pretty risky.

Slip - I use 0.15% slippage in all my back test simulations. Since I use market orders, I think there is more probability of slip between subscribers and out-of-sample results.

Signal Frequency - WealthSignals only supports daily signals so my trade strategy is based on this. So you don't need to sit around all day to make this work. Place your orders before start of day.

Signal Timing - Signals are generally sent to WealthSignals in the evening after market close but sometimes they may come before market start that day. I believe WealthSignals will email when they are published.

----
Lastly, due to interest, I may be converting this to a LONG only trade strategy with limits this weekend. I will post updates if this happens and upload new back-test simulation results. Unfortunately, this means that some of the information I provided today could change.
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ashridharani

#9
Hi BigReturns,

Are you still accepting subscribers? Your post from the 5th says there is an issue, but the orange status says 80% threshold reached, but you are still accepting them. Of course there is no "Subscription" button to click on...so not sure what is going. Just checking.

Thanks.
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Eugene

#10
DoubleStrike System Modifications forum > New Subscriptions Hold