The trend-based grid trading rules proposed in this article are a money management tool that integrates exit rules and can be used to accommodate various entry conditions, such as: double-equal entry, channel break-through entry, etc.
The rules of trending grid trading are:
(1) Divide the funds into 10
(2) meet the entry requirements (work more or do less) and use one entry fee
(3) For example: set the middle line (equal to the entry price) according to certain rules (e.g. stop loss line = 0.9)The entry price (floating stop-loss line and floating stop-loss line, in general, (floating stop-loss line-middle line) = 1.1(Line of stop loss)
(4) When the subsequent stock price triggers the stop loss line, all funds are out of the equity.
(5) When the subsequent stock price reaches the floating stop line, move the midline to the floating stop line, while calculating the new stop line and floating stop line based on the midline at that time, while adding a capital.
(6) Repeat ((5) until condition ((4) is reached, and even all positions
The red arrow indicates buying, the green arrow indicates selling, the white line is the midline, the red line is the floating stop-loss line, the green line is the stop-loss line. The midline, floating stop-loss line and stop-loss line adjust dynamically with the fluctuation of the stock price.
This way of managing money, or the rule of thumb, loses very little in volatile markets, usually only 10% to 20% of the position, but in bull markets (when there is a trend), the position will slowly grow and get higher returns following the trend!
10 funds in total
Entry: Closing price down 0.5*ATR on the previous day for upside down, breaking the upside down to make one more fund, breaking the downside down to make one more fund
Trading rules for cards and exits: Trading rules for trending grids (specific rules as shown in section 1)
Re-testing effect: The volatile market is not losing money, the trend market (no matter how empty) the capital curve is rising rapidly
This paper proposes a trend-based grid trading rule that looks at money management and exit rules, which can be accompanied by different entry rules. This trading rule introduces a trend-based trading strategy that can capture trends in trending markets, increase positions for high returns, reduce positions in volatile markets, and control losses.
Translated from the original by Chengye.
Not unusualSounds like a good idea.
The Little DreamIt's not ideal to achieve the same effect.