I saw this posted somewhere and wanted to get feedback on the mathematics of it:


1. Get on a sim in your market and set up a simple fixed bracket order (ie: 8 tick gain, 4 tick stop)
2. Flip a coin for your entry - Heads/Long, Tails/Short
3. After the trade exits, wait 30 seconds, do it again
4. Take 50 trades
5. Repeat exercise a few times (in a different market if you want)

The expectancy in your results just might surprise you.

(If you want to see something really powerful, use the same approach but use 2 contracts and have one scale out at 4 ticks. When you look at your expectancy now, remember that this is with a completely random entry.)

The unstated suggestion here is that the above would be profitable long term. True or not?

No edge = break even on the long term if you add commission and slippage then = negative expectation.

Java 

I saw this posted somewhere and wanted to get feedback on the mathematics of it: 1. Get on a sim in your market and set up a simple fixed bracket order (ie: 8 tick gain, 4 tick stop) 2. Flip a coin for your entry - Heads/Long, Tails/Short 3. After the trade exits, wait 30 seconds, do it again 4. Take 50 trades 5. Repeat exercise a few times (in a different market if you want) The expectancy in your results just might surprise you. (If you want to see something really powerful, use the same approach but use 2 contracts and have one scale out at 4 ticks. When you look at your expectancy now, remember that this is with a completely random entry.) The unstated suggestion here is that the above would be profitable long term. True or not?

Why bother asking? Just try it - & don't forget to tell us how it went

There are several threads on this subject.

Here is one I started a while ago but there are many if you search for Flip or Coin etc.

Coin Toss Experiment (Strategy) I posted this in the Futures Trader Webinar Thread, Big Mike suggested I create a new thread... This is it :playball: I've attached a strategy below. It was created to show the results of trading with random entries. It is just a quick …

Java 

I saw this posted somewhere and wanted to get feedback on the mathematics of it: ... The unstated suggestion here is that the above would be profitable long term. True or not?

False.


Run as fast as you can from whomever is telling you this is a good idea.

I'm pretty sure I remember that FT71 talked about this in here at somepoint:

@Java can you post your results?

DavidHP 

There are several threads on this subject. Here is one I started a while ago but there are many if you search for Flip or Coin etc. Coin Toss Experiment (Strategy) I posted this in the Futures Trader Webinar Thread, Big Mike suggested I create a new thread... This is it :playball: I've attached a strategy below. It was created to show the results of trading with random entries. It is just a quick …

Great, thank you for the link. That answers the question, and specifically this post shows the data: bigmiketrading.com/psychology-money-management/19803-coin-toss-experiment-strategy-4.html#post321074