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Chita's Portfolio. Follow up thread

I have 4 Darwins in my portfolio:
LVS - 400
PGH - 400
RWL - 300
OPK - 300

With this correlation:

What do you think of it?

And I also have 2 Darwins: SLW and VER, which I trade manually on forex pairs, doing swing trade (ideally a trade should last several hours, at least).

With both I took a tremendous risk, SLW had to be funded several times to avoid account liquidation. Finally I managed to recover and is in green numbers.

VER is the same story, following the same tradings only that I started the account after the drawdown, so it got only the upside.

Both Darwins show a very high VaR. I know I am doing a lot of things wrong. I must reduce my trading size to 0.01 or 0.02 lots at most or I will go broke in the next year most likely. I think I must follow the same swing style, and only put a few trades per week, ideally no more than 3 - 5

But I don’t really know how to manage my accounts in order to reduce the VaR (or if this is even the most significant parameter, or should I study something else)

Where do I start? I feel I have lot of work to do…

I will update this thread every month to show my “Rise or Fall”

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If you hold the var stable in your strategy, you are not doing anything wrong with the darwin. It would work in the same way with your var in 60, 40 or 20. Only you have to stabilize it. I see in the RS that you are getting it…

If you want to reduce the VAR, because you consider that is a big risk for your strategy (not for the darwin), you could increase the equity or reduce the leverage, but GRADUALLY. If you are working with a few microlots is better the option to increase the equity, because you could do this more gradual without affecting the replication of the darwin

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For swing trading a good starting point is 0.01 and equity 500.
I see that you have an equiy of 1000 so 0.02 should work well, generating a VaR between 8 and 16%.
The exact value has to be discovered experimentally.

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Thanks for your kind replies.

I will talk a bit about myself. I earn my living with my job (not with trading). History short:

Stage 1. I have been trading for many years in a totally naive/gambler approach, of course lost a lot of money. Stopped trading for some years. Stage 2. Then studied a bit, came back to trading. Then won some some money. And became overconfident and broke the account. Stopped trading, learned a bit more. Stage 3. Started again with a demo account. At this point I was committed to improve. Losses in the demo account were surprisingly painful. I kept trading and started with live accounts again. Stage 4. Overconfidence again led me to losses, but this time I was able to keep a trade open for weeks and was comitted to the trading plan, and had patience. And I recovered form those losses.

Stage 5: I want to make the account last forever. Psychologically I suffer much less, but I want be able to get in and out of trading to take a swing, complete the trade, and then be out for weeks. To put a trade and forget about it. And to use small lots. Still on it

I just follow a few traders. I have been following their scenarios for years. I study them so that i can understand the patterns they use and why they have built that scenario. And then if I find a scenario suitable I build the plan and put in the trade. That’s all.

I tried to do my own technical analysis, but I get too attached to my scenarios, I get proud of them and when they are wrong, I just can’t admit it and lead to more losses. I don’t have the vision and the flexibility, but when I see other people’s scenarios it’s easier, I’m more independent I can even take a position against the scenario.

With all this, I mean that my action is:

  • Choose the right scenario
  • Design two strategies on it (with the scenario and against the scenario)
  • Choose the strategy, chose the lots size, put the trade and stick to it

Besides that, I do some price action trading based in the direction of the underlying trend and what I see in the chart, in less than one minute. If i’m not able to see the trade in short time, I don’t put any trade. If i put the trade and my guts tell me it’s wrong, I close it immediately.

I consider the market a big artefact to take money from the weak. I try to find out which movement will make the bigger lose to the larger amount of weaks (like me), where are the SL? Where should the price go before executing the TPs? Where should the retracement go to make them close the positions too early? And so on.

Am I doomed to failure with this strategy?

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100% agree on the psychology part.
Everyone passed through it.

About SLs and TPs , I don’t know magicians or prophets to suggest me the right placing, so I went on the algo road.

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I think the algo road is waiting for me (and for everybody) in the end.

My biggest milestone to achieve is start back-testing and playing with EA (which I guess is the first mile in the long algo road) I am sure that when I do it, I’ll be wandering why the heck didn’t it before.

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Ok, 30 days after my last post… Time to update.

Finally I made the old classic mistake… becoming over confident, over optimistic, over-sized and making damage to my accounts.

Process has been like this:

  • OK, it’s all good, profits, I have good feelings. This time it’s different
  • Oops, important news incoming, let’s close everything, don’t want to risk
  • Dammit! The prices moved in my favor with the news and I missed big profits by closing. Why didn’t I stick to my plan, regardless the news?
  • OK, reopen, let’s go, the scenario and plan are still valid stick to it.
  • Haha, mores new incoming, I don’t care. I stick to my plan. This time they won’t fool me.
  • Dammit! Price moves sharply against me!! Why didn’t I close before the news… close everything now!!
  • Good thing I closed, prices keep moving and I saved profit by closing
  • I am a good trader, after all.
  • As a good trader, I recognise a good scenario now to short indexes. A bit oversized the indexes for my account , but the “occasion” is worth it.
  • Stopped out, let’s try again (loop…)_
  • Goddammit!! You can’t beat me you stupid market… LET’S DOUBLE THE SIZE AND SHORT THE NASDAQ!!
  • Oh my God, what am I doing? This again?? Again???
  • Stop trading.

On the bright side. This would have killed me a year ago. I would have probably killed the account, added more money, killed again… This time it just took around 66% of my hard earned profits.

And I think this is a good picture of why I need so much to get into algo trading and stop manual trading. My psychology, my will it’s not strong enough.

Will stop trading in my VER and SLW darwins for a while

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Well, finally I am not stopping to trade… The sacred rule for next months is to not trade indices at all, and use small lots/fewer trades. Let’s see if I can go back on tracks emotionally. Probably I will stay away from indices forever. My performance on them has been terrible and it’s clear that I try to be some kind of “hero trader” when it comes to indices. Stay away.

Also, it seems to me that August has been a difficult month, I see many of many Darwins taking loses, an the DWEX index has a sharp decline. But no mistake, my loss came as a consequence of my behaviour.

Now this is my portfolio as investor:

And the performance:

I have increased my assets in July, and specially in August (yeah, the bad month) so the % performance looks a bit weird

Generally I look the recent performance, history, DScore, and maximum DD. Try to keep Darwins with Dscore >50.

I put some own sauce on top on that:

  • consider also younger/less scored Darwins from traders that have other succesful Darwins
  • Darwins with a recent DD and a good system, they will likely recover.
  • Traders that use to explain their system, why they had a DD, etc

To sell Darwins I keep an eye on loses when they come along with sudden risky trades, and/or increases of divergence above 1%

I don’t know how to handle the combined divergence very well. Should I make decisions because of that? Will I get rid of a good Darwin just because of the -divergence, or should I wait for the Darwin to reduce -Divergence? Don’t know yet.

My plan is to add more assets and about 5 more Darwins, and keep a steady portfolio for several years.


Generally this platform is awesome, but (surprise, surprise) it needs attention. I try to “sell” it to people that asks me for advice, but the problem I see, if they don’t have a basic knowledge they will do stupid things and then blame the platform. I usually advice them to learn with tutorials/trade in demo, but then they get bored/scared and go away (to fall in some bank employee’s arms who will sell them some shitty advice) :cry:

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Not happy at all with my behaviour… Implemented a set of simple MM/Behavioural rules:

  • Resized accounts to £1000
  • Fixed lot size of 0.01
  • 0.01 lots traded per £500, i.e. I will keep open max 0.02 lots at the same time
  • Maximum loss per 0.01 lots trade is £20 (2%)
  • Seek only 2x or higher RR trades
  • Only trade forex pairs, swing trading, under controlled scenarios with fixed SL
  • TPs can be taken early, if the Rr is at least 1.5 (but that implies the trade is over for that scenario)
  • Only place conditional orders and wait.
  • Deleted MT4 from my smartphone. Only trade at home, from my laptop

The goal this month is to be loyal to this set of rules.

See you in one month :wink:

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One month later… It feels more like 3 months passed, buth only one month :slight_smile:

What happened:

  • After violating many of the rules above, I decided to close my trading accounts and forget about the forex market for a long time. It is not working, it takes too much effort, it’s too difficult and drags me too much to the wrong habits.

  • I started trading stocks. Pure trading in traditional stocks, no leverage, no CFDs. There’s a nice bullish market out there with hundreds of stocks in the US, Germany, UK, etc either making new highs, breaking through, or in support levels. I am open minded and everything could change in a few weeks, but what we have now is a cake.

  • I have decided to keep my Darwin portfolio and regard it as a very conservative asset, I want to keep an eye on them and move the money from stocks to Darwins, if the bears get stronger.

So far the profit of my investor account is 2.5% in about 5 months. Not bad if keeps the pace and returns 5-6% in one year without much suffering.

My portfolio changed a bit. Had to close OPK (I am sorry, but the LA and RS score deteriorated too much)
Had to close XIN as well (I regret a lot having invested on this Darwin, not much more to say…)



The divergence is not very well balanced, I probably will have to adjust my portfolio… Honestly, I am not doing much effort on this, just a peek every other day and closing Darwins with deteriorated scores…

And that’s all, see you in a month

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It is not so difficult to make money with stocks in a bull market, problems start when the selloff begins and everything falls by 50%.
Your is the right approach, with darwins you are investing in trading systems renting them from other people.
I think your current portfolio will return much more than 5%. :wink:
About XIN you dont’ have to blame yourself, it was impossible to predict that blackswan after 3 years of trackrecord.
Keep on!

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Yes, investing in the SP500 on the long term is great only if you are able to step out and not get caught in one on the historic bear markets (when DDs go from 25% up to 80%). Not easy

About XIN, totally a black swan, that guy had around 80 DS for a long time… I guess it is too difficult to control everything and make a system able to detect the trader’s behaviour and preemptively reduce the score soon after the trader starts to fail/gamble.

And now, to be fair with Darwinex, average yearly return of the SP500 is around 10%, but with terrible periodic DDs, aka bear markets. Getting that 10% in Darwinex without that big periodic DD, in products highly uncorrelated is great value. Let’s see if I can do it :relaxed:

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More than on month later…

About the portfolio, main highlight is the DD in PRZ. JGC has ben losing, specially the last week, but not even close to PRZ’s DD. RWL, NTI also still down.

On the bright side, LVS/BDR have been doing a lot better.

Performance fees have been taken from the account, lowering the profit even more because some Darwins went donwhill after the fees were paid. Well, at least when the Darwins recover I won’t have to pay more fees.

So, more than 6 months gone. The performance peak has been around 6-7%, the low has been around -1%, and right now the profit is just 1.5%

I am following a buy&Hold strategy, it makes no sense for me to trade Darwins, I think the risk of ruin is quite low in Darwinex, but also the performance is not great so far. On the happy side, I am more and more convinced of how honest the Darwinex team are, and how seriously they take to deliver a revolutionary product…

I have bee learning a lot since I joined Darwinex, and I am starting to use another interesting options for long term investing, that I will use as benchmark.

I will keep my portfolio, at least one year, and after that if nothing catastrophic has happened, will keep the portfolio another year. So 2 years in total. After that, will compare Darwinex with my other investments. I think that will be enough to get an idea of how good is this. Hopefully Darwinex will improve even more in this time.

Besides that, I returned to trade on my Darwin VER. As per the description: “Minimum maintenance swing trading on daily and weekly TF. No news, no noise, small size and big SL/TP. Martingales, grids and any kind of “cleverness” are absolutely forbidden. Two Principles: 1)Be Patient 2) Don’t do stupid shit”

I am very happy because I am following the guidelines, I read the scenario, open the trades, set the SL and TP and the I don’t give a s**t anymore (pardon my language) And it feels great.

It makes no sense for me the forex market/leveraged assets. Too dangerous, too difficult, too easy to lose control. I am turning to traditional assets, only long positions: ETFs when the stocks are trending, Bonds in bear markets. That’s all.

I will keep trading in my £500 forex account, just in case I can setup some simple strategy based on big, trend follower swings. I will consider a success if VER is still alive after 2 more years :slight_smile:

See you next month…

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Update one month after.

November was a bad month but December so far is being awesome.

My apologies but I realised the way of calculating the return/time is not very accurate. Since I started I have been growing the assets invested, so the return at any give moment is not the actual return of the portfolio. To be clear: I just divide today’s accumulated “net money in” by the (“Equity” ± “Available to invest”) values, i.e. I don’t include any timing consideration. Today’s return would be 3.56% (great improvement on past reading of 1.5%)

This is just an estimation. The total return after liquidation can be different. For example my THA Darwin returns now 21.80%, but also has in my current portfolio a huge divergence of -5.75% :cold_sweat: Also, because performance fees for many of my Darwins have been paid unfortunately in “peaks”, there’s room for the return to improve a lot when those Darwins recover and go above their watermarks (if I have understood well how this works), as that recovery will be “free” of performance fees.

This is my portfolio return as per dashboard information:

And that’s it. Hope in a couple of months the return will be great :slight_smile:

PS: adding my portfolio composition. Note the great divergence on THA and the huge Drawdown I took on PRZ

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I see a huge DD on RWL not on PRZ

To be fair, both PRZ and RWL

PRZ was 18% up and now is -3% (and has recovered lately)

Probably I forgot to mention RWL because it has been always in a loss and psychologically is more painful to go from huge profit to small loss, than form small loss to huge loss :frowning:

Anyway, I trust more PRZ. RWL has already setup a stop loss, and maybe it would be better if it triggers the SL and I get rid of it

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Hi @Chita
Any updates on your portfolio?

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Hi Caballero :slight_smile:

Not too much, RWL is out and QUA is in

This is the evolution of the portfolio,s return:

Since January it went down again (BDR and LVS had their classic January pullback and I did nothing to avoid it, and THA is kind of lagging a bit) and today the return is around 1.5%

I am not following it with great passion, to be honest.

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Another small change: PRZ out, STV in

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There was an error in my previous calculations. amended now. The return was a bit higher actually.

But the portfolio is in a loss now. In general, many darwins went down the past weeks. I’ve taken some damage because of the GBPUSD strength as well. Hopefully there will be some kind of mean reversion next months and the portfolio will be back in profit.

I have been refining my portfolio these months, my Darwins tend to yearly returns of around 20% on average. I have now setup SL for my weakest Darwins and will re-balance the portfolio to the stronger ones if I get stopped out. You get a bit excited when you see some Darwins having yearly returns of 50% and so on in the past, but you have to be aware that it is not so easy, there are huge divergences sometimes, there are performance fees, there are the usual DDs, sometimes in concurrency…Don’t guess and just record and observe the facts. Will keep posting every month and let’s see where we are in one more year.

And my Darwins list:

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