January 2008 Forex Trading Contest Winners

I realized today that I never announced the winners of the "no-prize" trading contest that concluded at the end of January.  16 traders participated, 7 were profitable, 9 were not.  The total return for all profitable traders was 70.28% compared to a total loss of 255.85% for the 9 losing traders.  Before I announce the top 5 traders, let me define two terms that will be used in the recap and in the trading results on Oanda’s contest page:

Maximum Drawdown: The maximum drawdown of the contestant. The period over which the drawdown is calculated is delimited by the times when contest statistics are computed.

Sharpe ratio: This is often regarded as a measure of risk to reward and attempts to quantify how much risk a user assumes to make their gains. This is measured as the ratio of the average interest free return as compared to the standard deviation of the interest free return. Return periods are delimited by the times when contest statistics are computed.

1. Elskid had a return of 23.74% with a very respectable maximum drawdown of -1.60%.  
2. Davor Babic was close behind the #1 with a return of 21.20% but with a higher maximum drawdown than any other profitable trader at -10.18%.
3. RotcaX had a return of 11.80% and a low maximum drawdown of -1.63%.
4. Forex Project (me) had a return of 6.86% with a maximum drawdown of -4.00%.
5. Uri had a return of 5.37% with a maximum drawdown of -6.16%.   

Congratulations to the winners.  Sorry there were no prizes to make it a little more eventful…

Popularity: 2%

2 Percent Risk with 2R Multiple

I’ve been emulating my real account trades with my demo account for the January forex trading contest.  I’m currently in first place with a return of 11.16%.  After today though, my return will drop 2 percentage points to about 9% since I lost 2% on a trade.  I don’t know if this will be enough to hold on to the lead.  

This is an overview of how I’ve been trading so far in January 2008: 

1. I have been risking exactly 2% on every trade.  No more, no less.  
2. I’ve been using my forex position size calculator everyday when figuring out my trade size and find it very handy.  Some of you have commented the same.  
3. My R-multiple on every trade has been 2R.  For those of you that haven’t heard of R-multiple, it’s really just an abbreviation for reward-to-risk.  2R means my reward-to-risk is 2:1.  
4. I’m not watching my positions so there isn’t any fancy money management going on.  I haven’t once set my stops to breakeven. I’m just letting them ride.  If they hit my target, they hit it.  If they don’t and stop out, so be it.  This is quite different from what I’ve done in the past.  In the past, I’ve been quick to set my stops to breakeven when they move a little in my favor.  The consequence of doing this was typically a gain/loss of zero.  I can’t tell you how many times I’ve moved my stop to breakeven only to see it get stopped out.  Then I have to watch as the price goes back in the direction I was trading where it hits my initial target price.  This to me was more frustrating than losing.  I’d rather stick to my guns on a trade instead of playing it scared. 

Popularity: 10%

5 Reasons to Enter the Forex Trading Contest

17 traders have already joined.  It would be great if you did too. What’s in it for you? 

It’s a chance to _________. 

1. check out Oanda’s trading platform
2. add a little more incentive to trade that demo account like it’s real
3. compete for pride
4. have your name mentioned on the front page of this blog (big deal, right)
5. get back into demo trading to try that new strategy you’ve been meaning to forward test

Check out details on how to join at http://www.forexproject.com/Forex_Contests/

Join within the next couple of hours.  I have to approve the contestants before midnight today but I won’t be around later tonight because it’s New Year’s Eve.  Contest starts at midnight on January 1st.  If I don’t talk to you before then, have a Happy New Year. 

Click on the image on the top right to see the results from the last contest.

Popularity: 3%

May Forex Trading Contest

With about 1 week through the May forex trading contest, Alex leads the money manager category with an impressive 18.20% return.  itineranttrader leads the conservative category with a return of 2.79% and currently there are no aggressive trading category leaders.  Equally as impressive is the fact that a majority of the 14 traders with a positive portfolio return also have impressive maximum drawdowns.  The contest is still early though and I'd expect this to change over the coming week(s).  

 

 

 

 

 

 

 

I had 1 profitable and 1 losing GBP reversal trade which balanced out.  My gains are mainly due to shorting the USD/CAD multiple times.  I am currently out of the market but have some longer term signals that will give me trading opportunities when the market open on Sunday.    

Popularity: 1%