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Does the martingale system really work?

  • #261
  • Nov 25, 2013 9:31am Nov 25, 2013 9:31am
Quoting Master_kiwa
I love these guys with the +10 vochs. They seem to know it all. Yet, they never seem to have a trade explorer to they are actually good at what they do, or at least what they claim to do.
They secretly refer to themselves as the "FF Posse". They move from thread to thread, attempting to save inexperienced traders from the ever-increasing world of scammers, indicators, and unproven strategies. They meet via a private chat room each Friday evening, discussing coin flips, gambling, Martingale, and their array of statistics that, in all practicality, have very little to do with the markets. And yes, they do certainly think they know it all.

You can try to crash their meetings, but I must warn you, they take their privacy very seriously. Try to infiltrate their secret lair and they will hunt you down and make you suffer. They will force you to perform coin flips and spin a roulette wheel until your fingers bleed. And then, just when you think the torture is complete, they will force you to type "martingale does not work...indicators suck...EAs can not be profitable" a million times.

I've said too much...I think they are monitoring my PC...some of these guys are ex-CIA or ex-NSA.

These guys are ruthless...don't cross them again...you've been warned.
  • #262
  • Nov 25, 2013 11:32am Nov 25, 2013 11:32am
lol, i love this thread as i can see so many old faces showing up now and then.

hello to Nub and ZZ, we should have a coffee together, and i'll watch you two being cynical.
  • #263
  • Nov 25, 2013 12:18pm Nov 25, 2013 12:18pm
Quoting Kanzler
{quote} Hanover has been around this forum for a number of years and is in my opinion undoubtedly one of the best people here to explain probability and statistics. He has a very strong understanding of mathematics and he's proven this through his numerous insightful posts - his vouches aren't for no reason. Listen to him, he's right.
Well he has yet to prove that martingale doesn't work mathematically. In order for something to be proven mathematically wouldn't you have to display mmmmmmm.... errrr...... MATH! Simply saying "It doesn't work" isn't mathematical proof. It is nothing more then an objective belief towards a system. Mathematical proof would be "Condoms have a 2% chance of breaking during intercourse." That can be proven mathematically based on several factors. Such condoms which broke during intercourse compared to those which didn't. Hanover nor Noobcake has yet to post any data which can be analysed to validate their belief. Having a "+10" doesn't render you a mathematician, nor a guru. It will be my pleasure to show you guys how martingale actually works. Although guys will say "eventually you will hit a losing streak which will wipe out your account" seems to be the favorite phrase of the pessimistic +10'ers. "Eventually" is never factored into forex. Only those who are citizens of fairy tale land dedicated by the +10'ers belief such non-sense.
  • #264
  • Nov 25, 2013 12:48pm Nov 25, 2013 12:48pm
Quoting zznbrm
They meet via a private chat room each Friday evening, discussing coin flips, gambling, Martingale, and their array of statistics that, in all practicality, have very little to do with the markets. And yes, they do certainly think they know it all.
No offense, but perhaps you should read some literature by the likes of Dr Ryan Jones, Ralph Vince, Fred Gehm, ...... or google something like "the role of math and statistics in risk and portfolio management". There are plenty of academic papers out there, and while I understand only a very limited amount of the material they present, I favor their views over folk who contribute to forums like this one.

If you have ideas, theories or strategies that you're willing to share, I'd be interested to see them. I'm happy to participate in civil discussion.

I'm not part of your posse. My wife and I go out to dinner most Friday evenings.
  • #265
  • Edited 3:23pm Nov 25, 2013 1:14pm | Edited 3:23pm
Quoting Master_kiwa
Well he has yet to prove that martingale doesn't work mathematically.......
Agree with you that vouches are meaningless. Knowledge and expertise that leads to profit is king.

See my reply to zznbrm. I posted some links to material written by math gurus earlier in the thread. I can post more of them, if you're genuinely interested in reading the material. I'm happy to discuss ideas and strategies, but I'm not interested in getting into ego-based arguments about who is right or wrong. I prefer to let math speak for itself.

To state the obvious, it's impossible to prove mathematically whether a certain type of price pattern, that generates a prolonged losing streak, will or won't occur during a trader's lifetime. That is true for any system, no matter what trading strategy (entries and exits) or MM is used. But there's a tidy mathematical proof here by PipMeUp, demonstrating that MM can not improve expectancy.
  • #266
  • Nov 25, 2013 3:08pm Nov 25, 2013 3:08pm
Quoting charvo
hello to Nub and ZZ, we should have a coffee together, and i'll watch you two being cynical.
Hello charvo. Hope you are well. I think a beer would be a little more appealing.

Quoting hanover
{quote} No offense, but perhaps you should read some literature by the likes of Dr Ryan Jones, Ralph Vince, Fred Gehm, ...... or google something like "the role of math and statistics in risk and portfolio management". There are plenty of academic papers out there, and while I understand only a very limited amount of the material they present, I favor their views over folk who contribute to forums like this one.
Sorry, I'm more of a do-it-yourselfer...real trades with real money is the best way to learn (for me) in this business. Academic papers are not as good as real, personal experience.

Quoting hanover
{quote}I'm not part of your posse.
Definitely not my posse...I want nothing to do with jumping around from thread to thread trying to save the world...many more interesting/important things on my to-do list.
  • #267
  • Nov 25, 2013 4:10pm Nov 25, 2013 4:10pm
Very interesting conversation the last several pages. Would love to see further input.
  • #268
  • Nov 25, 2013 4:17pm Nov 25, 2013 4:17pm
Quoting zznbrm
{quote} they secretly refer to themselves as the "ff posse". They move from thread to thread, attempting to save inexperienced traders from the ever-increasing world of scammers, indicators, and unproven strategies. They meet via a private chat room each friday evening, discussing coin flips, gambling, martingale, and their array of statistics that, in all practicality, have very little to do with the markets. And yes, they do certainly think they know it all. You can try to crash their meetings, but i must warn you, they take their privacy very...
the first rule of ff posse!!! How can you forget the first rule?!?
Congratulations ScalaFX for coming out of the closet!
  • #269
  • Nov 25, 2013 5:00pm Nov 25, 2013 5:00pm
I believe that some traders use Martingale successfully!

To use it one must have quite a big account so that one risks about 1%. With small account where the risk is about 10% we can only be wrong 3 times:

risk:
10%
20%
40%

and then it ends. And even for that one needs 1000:1 broker (most of them suck) low stop out etc....

Other than that I can see how it could work. I'm not that awesome trader (yet) and in november I was never wrong more than 4 times in a row.

Q: How much money do you guys think a trader that uses Martingale should have?
  • #270
  • Nov 25, 2013 5:11pm Nov 25, 2013 5:11pm
People have done it before - you think you're the first one who "understands" martingale and can somehow make a fortune from it? If the market were that simple we'd all be rich and everybody would (miraculously) be making money. Brainless strategies that require no thought aren't how people make fortunes in the modern era. You can even write a basic script to simulate a martingale run and see the results for yourself. There are probably even pre-made EAs out there that you can backtest with.

Speaking of which, take a look at every martingale trade explorer out there. Either they've had a great run and all of a sudden suffer catastrophic failure or the run is still going and the failure is yet to come; there's no other outcome if you continue to do it. Of course most of them disappear after their accounts have been crushed to avoid the humiliation. But it's your money, not mine. Feel free to donate your funds if you honestly think the world is that simple.

Quoting Vitez
I believe that some traders use Martingale successfully! To use it one must have quite a big account so that one risks about 1%. With small account where the risk is about 10% we can only be wrong 3 times: risk: 10% 20% 40% and then it ends. And even for that one needs 1000:1 broker (most of them suck) low stop out etc.... Other than that I can see how it could work. I'm not that awesome trader (yet) and in november I was never wrong more than 4 times in a row. Q: How much money do you guys think a trader that uses Martingale should have?
And the less you risk the less you get back. There's a linear relationship between the returns; the less you risk the less you make but the longer your account survives. The more you risk, the more you make but your account dies quickly.
  • #271
  • Nov 25, 2013 10:28pm Nov 25, 2013 10:28pm
Quoting Kanzler
If the market were that simple we'd all be rich and everybody would (miraculously) be making money. Brainless strategies that require no thought aren't how people make fortunes in the modern era.
Got to love it when people have to "generalize" in order to prove a point. The market boils down to self - control. If you're able to keep your emotions in check you more then likely will never experience a margin call. Kanzler's opened ended statement is like saying "If people could make money in forex, then everyone would be doing it." Well have you ever thought that not everyone has the same interest as you Kanzler. Perhaps he/she has different goals, and out look on life which in turn allows them to perceive things differently. We all have the same charts, same data. So why do some people see a long, when others see short. Or why do some see a 30 tp when others see 60 tp. Trading is 1000% subjective. What kills me are these +10'ers with no trader explorer who swear they are gurus. How about leading by example instead of leading by bias words.
  • #272
  • Edited 10:59pm Nov 25, 2013 10:43pm | Edited 10:59pm
Quoting Master_kiwa
{quote} Got to love it when people have to "generalize" in order to prove a point. The market boils down to self - control. If you're able to keep your emotions in check you more then likely will never experience a margin call. Kanzler's opened ended statement is like saying "If people could make money in forex, then everyone would be doing it." Well have you ever thought that not everyone has the same interest as you Kanzler. Perhaps he/she has different goals, and out look on life which in turn allows them to perceive things differently. We all...
Being butthurt about not having any V's of your own is sad. Grow up. If you could have my V's I'd give them to you. They are worthless except to nobodies like you who can't even manage to scrape a few of your own by being someone of merit. Even some absolute lunatics and morons manage to get V's, and yet here you sit with none. And just for some salt in your wound, if I recall correctly I had my first V within a week of creating an account. Look at you with your months-old account crying that people with V's are big bad meanie poopy-heads.

Kanzler's statement is nothing like saying what you equated it to. Not at all. Nice hyperbole, but as usual you are speaking rubbish.

Here's a generalization for you. You just said that keeping emotions in check is the key to not getting margin-called. I would have to assume that this means while using martingale, since that's the topic at hand.

Do you think martingale EA's have emotion?

Hope and a steady-hand gets you nowhere without an edge. Nobody with an edge stupidly risks their account. It's just really, truly, that simple.

But even simpletons have trouble with the simplest of things.

edit: and just to really give you something to have a cry about, I quickly went back and checked. My first post was on the 28th Oct '09, and my first vouch was sometime around / before the 7th Nov '09. So roughly a week. Why has it taken you so long to not even get a single vouch, and now cry about it so very hard!? I'm sure if you keep complaining enough someone will sling you a pity vouch, so keep it up.
Congratulations ScalaFX for coming out of the closet!
  • #273
  • Nov 25, 2013 11:02pm Nov 25, 2013 11:02pm
Sounds a lot like chasing losses or revenge trading, but if you know what you're doing and you can stomach it why not? Personally me I'm happy to reenter with my initial lot size, get the loss back plus a little more (I wouldn't reenter thinking only to get the loss back otherwise it's time to close it off, turn it off and walk away).
  • #274
  • Nov 25, 2013 11:11pm Nov 25, 2013 11:11pm
Quoting nubcake
{quote} Being butthurt about not having any V's of your own is sad. Grow up. If you could have my V's I'd give them to you. They are worthless except to nobodies like you who can't even manage to scrape a few of your own by being someone of merit. Even some absolute lunatics and morons manage to get V's, and yet here you sit with none. And just for some salt in your wound, if I recall correctly I had my first V within a week of creating an account. Look at you with your months-old account crying that people with V's are big bad meanie poopy-heads....
What else do you expect from someone who had the arrogance to prepend the title "master" to their username.
  • #275
  • Nov 25, 2013 11:23pm Nov 25, 2013 11:23pm
Quoting Kanzler
{quote} What else do you expect from someone who had the arrogance to prepend the title "master" to their username.
Classic kiwa... he "Master"ed when he should of "Retard"ed. If you "Master" when you should "Retard" you are going to have a bad time.
Congratulations ScalaFX for coming out of the closet!
  • #276
  • Nov 26, 2013 12:51am Nov 26, 2013 12:51am
Quoting Kanzler
There's a linear relationship between the returns; the less you risk the less you make but the longer your account survives. The more you risk, the more you make but your account dies quickly.
Well said,
  • #277
  • Nov 26, 2013 7:50am Nov 26, 2013 7:50am
Quoting nubcake
{quote} Being butthurt about not having any V's of your own is sad.
It appears that you have a lot of emotions about your Vzzzzz. I on the other hand am more interested in being productive in proving that martingale actually works instead of stand-offish about it not working. For those who are interested in learning about Martingale I will begin showing different methods which one can use. I will start off by using the 5 min charts, then we can work our way down to the 1m tf. From now on I will ignore the NOOBCAKE, and senor members who would rather tell you DON'T cross that bridge, instead of teaching you how to swim.
  • #278
  • Nov 26, 2013 7:55am Nov 26, 2013 7:55am
Quoting Master_kiwa
{quote} It appears that you have a lot of emotions about your Vzzzzz. I on the other hand am more interested in being productive in proving that martingale actually works instead of stand-offish about it not working. For those who are interested in learning about Martingale I will begin showing different methods which one can use. I will start off by using the 5 min charts, then we can work our way down to the 1m tf. From now on I will ignore the NOOBCAKE, and senor members who would rather tell you DON'T cross that bridge, instead of teaching you...
I know you are incapable of seeing the irony in your post.

It's fun to watch people like you try to prove things that are beyond your grasp. This should be, in a ways, good.
Congratulations ScalaFX for coming out of the closet!
  • #279
  • Nov 26, 2013 3:51pm Nov 26, 2013 3:51pm
Good day to all. I've attached two indicators. The two indicators simply allow you to back test previous "mid point pivots", and "pivots". Why are the aforementioned pivots important? Due to the fact that prices accumulate at those prices (pivot prices). Typically resulting in a high/low range of 15 pips. Here is where martingale comes into to play. As many before me will contend, that martingale "doesn't work", because eventually you shall hit into a long enough losing streak that will spell doom of your account I will now take over this thread to disprove the "upended" and "bias" notation by the naysayers.

Let us simply look and calculate price action once the price (on the 5m or 1m tf) first touches a mid pivot or pivot level.
The picture which I have attached (capturatoday) reveals the following.
1) Upward movement in price.
2) Touch/Close on a pivot/ middle pivot.
3) Followed by a red candle which closes.

After the red candle. You can simply wager that after 5 mins the price will not close above the high of the candle which closed at the pivot (binary options wager). If you trade using mt4 you can simply wager with the short position, marking a CLOSE ABOVE THE HIGH OF THE CANDLE WHICH CLOSED ON THE PIVOT as your stop loss. Here is where the martingale system comes into play. Assuming you can ignore your emotions of entering between pivots. You are simply wagering on a reversal at every single pivot which is closed a crossed. If one was to take statistics of price action once the pivot is closed on/ touched you will notice that a reversal ALWAYS occur before you have an extension through 14 pivots in a row. What that means is the price will never drop or increase through 14 pivot levels before ever reversing back to the previous pivot level which was closed a crossed. Meaning (two/three sessions without a reversal).

The photo marked " Todays pivot" reveals the same. Today one would consider AJ as a sell off. yet how many times could you have won a wager going long once the price closed red or touched a pivot? That is simply trading only using pivots. You have many more advanced ways of wagering like using binary options with mt4 trading as a form of covering an open position. Which of course you could use martingale.

Now as I mentioned before, it is unfair to say martingale doesn't work, without looking at the system which is actually being used. Martingale is simply a form of wagering (entering your lot sizes), but your entry or exit is based on your system (another ideology all together) . So being that pivots ALWAYS have a reversal before you ever lose more then 14 times in a row. You can then begin to look at unique formations which occur at pivot levels to tip the odds in your favor.
I have posted those indicators for those who have time to research. I can wager any amount of money that you will never find 14 straight pivots to be broken thought without a reversal never occurring (A reversal will be classified as the price going back to the last pivot level which it closed a crossed). You simply have to load the script and look for the same formation of the picture entitled "capturatoday". I've already taken all the stats, and have a spreadsheet of the probability of certain formations failing a certain amount of times (Just as myfxbook calculates something called 'risk of ruin".
Attached Image(s) (click to enlarge)
Click to Enlarge Name: Capturatoday.PNG Size: 34 KB
Click to Enlarge Name: todays pivot.PNG Size: 39 KB
Attached File(s)
File Type: ex4 #Daily_Pivot.ex4   8 KB | 486 downloads
File Type: ex4 #Pivots_Daily_Medians.ex4   8 KB | 505 downloads
  • #280
  • Nov 26, 2013 4:30pm Nov 26, 2013 4:30pm
Quoting Master_kiwa
Good day to all. I've attached two indicators. The two indicators simply allow you to back test previous "mid point pivots", and "pivots". Why are the aforementioned pivots important? Due to the fact that prices accumulate at those prices (pivot prices). Typically resulting in a high/low range of 15 pips. Here is where martingale comes into to play. As many before me will contend, that martingale "doesn't work", because eventually you shall hit into a long enough losing streak that will spell doom of your account I will now take over this thread...
Nice post Master_kiwa.. Funny thing people will still bash you and tell you it won't work lol..
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