I also think that the stock market farmer's rule refers to frequent strategy changes and not to frequent trades.
Your strategy can basically work.
If your trades have a CRV of e.g. 2 (i.e. in your example max. 5% profit against max. 2.5% loss), a hit rate of 35% is already sufficient to achieve a positive expected value (of course without taking taxes and trading fees etc. into account).
Here is an interesting article with a table:
https://stock3.com/boersenwissen/crv-und-trefferquote-was-jeder-trader-wissen-muss-6865429
With the appropriate effort, this can be done profitably. Why don't you test your idea with a demo account and tell us about the results here đ
Your strategy can basically work.
If your trades have a CRV of e.g. 2 (i.e. in your example max. 5% profit against max. 2.5% loss), a hit rate of 35% is already sufficient to achieve a positive expected value (of course without taking taxes and trading fees etc. into account).
Here is an interesting article with a table:
https://stock3.com/boersenwissen/crv-und-trefferquote-was-jeder-trader-wissen-muss-6865429
With the appropriate effort, this can be done profitably. Why don't you test your idea with a demo account and tell us about the results here đ
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4Mon
@ChrisBizz Thanks for the linked article! That pretty much sums up what was initially buzzing around in my head and concretizes it well! I will be looking more closely at the evaluation / assessment of CRV & hit rate next!
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