Precious Metals And Forex Trading Signals Performance 2016
71.1% Profit On Aggressive Portfolio (ytd), 61.6% Profit On Conservative Portfolio (ytd)
Long-term positions vs. Short-term positions
We divided the strategies in two parts: the core investment part (long-term positions) and the satellite speculative part (short-term positions). The core part is the one you would want to make profit with in the long term. Such an approach is a clear investment as you are bound to keep your position opened for a considerable amount of time in order to realize the profit.
The speculative part is quite the contrary. You would open a speculative position with short-term gains in your mind and with the awareness that even though potentially more profitable than investments, speculation is also way more risky.
How does it look like in practice? Long-term positions are much less risky than short-term positions. As you can see on the chart below, drawdowns in short-term strategies are much deeper than in long-term strategies. However, at the end of the day short-term strategies were more profitable. That is why, we recommmend long-term strategies for more conservative traders and mixed portfolio of short-term and long-term strategies for aggressive traders that are able to accept losses in the short term. Please read below about recommended conservative and aggressive portfolios.
We always suggest a position size in mini lots for USD 10,000 trading account. This is aimed to help in risk management of your portfolio. You can easily adjust the position to your trading capital. Following our position size suggestions for USD 10,000 trading account, we have calculated year-to-date profits in USD on long-term and short-term strategies.
Conservative portfolio vs. Aggressive portfolio
We suggest that investments should account for 60-90% of your portfolio, the rest being speculative positions. This way, you may enjoy a possibly higher rate of return than in the case of putting all of your money into investment positions and at the same time you may not have to be afraid of severe losses in the short term.
We have built two portfolios:
- Conservative portfolio consists of 90% long-term positions and 10% short-term positions and is recommended for conservative traders
- Aggressive portfolio consists of 60% long-term positions and 40% short-term positions and is recommended for aggressive traders
Following our position size suggestions for USD 10,000 trading account, we have calculated year-to-date profit in USD on conservative and aggressive portfolios. The results are presented below:
You can see that profits on aggressive portfolio have been higher than profits on conservative portfolio. But it is not a rule, because the risk on short-term positions is higher than the risk on long-term positions (lower percentage of positions closed with profit).
We hope that GrowthAces.com trading statistics are satisfactory enough for you and wish you even better results in the future.