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Scientist's demo portfolio

So, demo portfolio… Why not real? For obvious reason. I have my own strategy and I invest only in my own trading accounts. For diversification goal I would invest in completely different instruments rather than in someone else’s Darwins.

The goal of this portfolio is to investigate different Darwins, to demonstrate my approach to Darwins’ selection and to check what the possible investor’s outcome could be.

The portfolio will consists from 5 Darwins.
I do not find reasonable to over-diversify it with 10-20 or more darwins. To find reliable darwin is not easy and by increasing our portfolio we just increase chances of getting a bad one.
Also, as an investor I do not want to spend much time playing with my portfolio. The more darwins are in it, the more time-consuming would be to watch, analyze, make decisions, rebalance… I do not want it. Investments must not be complicated.

My criteria:

  • D-score >60
    -Ex >=7
    -LossAversion >=7
    -DD <= 20%

Also, I look at profitability. Forex is risky and my general rule for my own trading is that yearly profit is expected to be no less than three times max drawdown. I am not sure if I find such Darwins here but it is a kind of a benchmark that I have. A darwin with 10% drawdown and 10% yearly profit is not too appealing for me.

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La >= 7 is a strong criteria. Without checking days in Darwinex you will also get just migrated stuff in filers, but on this criteria there is still an unsolved incident so that must be checked manually.

How do maintain your portfolio if you find new Darwins filling your criteria? Immediately when you find a change or on a certain period?

@IlIlIlIlI Yes, it is a strong criteria. I cannot say why the threshold must be exactly,7, may be 6.5 or 6 is also good enough, I did not check statistically )) But for now I keep it like this.

I will reconsider portfolio in the beginning of every month. But I do not plan to rearrange it too often. I will exclude a Darwin if it shows 2-3 negative months in a row. Also, I think I will exclude whose that fall in a deep drawdown (>20%). Though it will be difficult psychologically but there must be some rule to stop flogging a dead horse.

While rambling among Darwins yesterday I noticed few darwins who look like “a dead horse” for me. Nevertheless they have investors money, sometimes quite significant. I do not know what these investors are waiting for…

With these critieria someone like https://www.darwinex.com/es/darwin/CIS.4.11 would be out, aren´t you considering some young very promising darwins like this one?

If you use a filter for that, you shouldn’t use it on the weekend because some data are not reliable on weekends. Start it earliest on Monday noontime.

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@Forexintradiadarwin Actually I am not absolutely strict with my criteria. When I was investigating darwins yesterday I checked few with D-score < 60 and I noticed CIS and short-listed it. Probably I will not include it in my portfolio immediately as I have other options but I keep it in my short-list for future.
The low La may mean potential loss ‘oversitter’ but it is not necessary the case especially for short-term trading.

In general, whatever criteria we choose always there will be a nice darwin which does not match it. I take it philosophically)
If I like the overall darwin’s profile I may buy it in spite of some unmatched criteria.

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My choice for January:
HFD, ZCD, WLC, SUG, TER

I invested 2000 in each of them.
I do not plan to rebalance unless something extraordinary bad happens.
portfoliojan20-beg
Watch-list: PME, JHU (both with divergency), CIS, GBI (migrated)

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My portfolio result for January is +2% (no double leverage).

All Darwins but ZCD got positive results. ZCD got -1.52%.
I decided to sell ZCD. Not because of this minus but because my portfolio is too conservative. I expect a higher profit from FOREX. ZCD is one of the least profitable so I replace it with GSK.

Portfolio for February:
HFD, GSK, WLC , SUG, TER.

From February I started double leverage portfolio (last month just missed it by mistake)

Also, I changed my Darwin selection approach, will write later about it.

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February 2020:

double leverage,
portfolio result-11.11%.

I am removing TER, it’s result in February is -7.41 meanwhile the whole 2019 profit of this darwin is 15.86%. So it’s losses are not comparable relative to it’s profitable months. Also,I did not like how he traded this month - he had +7% at first, when it looked like he got greedy, traded more and more, started loose, losses quickly accumulated… It looked extremely chaotic.

HFD I also want to replace but probably will watch it for one more month.

Portfolio for March:
HFD, GSK, WLC , SUG, TDD (new, instead of TER).

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