Interviews with traders. With audited track records!

darwin tdd

Interview with TwentyEight (DARWIN TDD)

TwentyEight is the trader of TDD. This DARWIN has currently a >€175,000 DarwinIA allocation and has already earned more than €3,000 in performance fees. We wondered whether TDD could be considered a hidden gem in a jungle of more than 3,000 DARWINs and asked our Exchange’s users to submit questions about it. Quite a few did this.

Here are the questions, together with TwentyEight’s response to them. Thank you all, both TwentyEight and community members who’ve sent questions! Enjoy!


1. TwentyEight, tell us a little about yourself. How did you get started and how long have you been trading for?

So, I have worked most of my adult life in the Hospitality industry and have owned and co-owned several ventures and have been lucky enough to live in several different countries around the world. I’m currently based in Australia on the Sunshine Coast, I’m a real health and fitness fanatic, love my golf, my dogs and the beach.

I’ve always been entrepreneurial and even as a teenager was always business oriented and about 10 years ago I realised that I’d had enough of the Hospitality business. Again as a teenager I remember having a great fascination with the stock market so I decided to start gaining some knowledge in the investing/trading world. However it wasn’t until the beginning of 2015 that I decided to take the plunge and opened my first account. After my first year I quickly realised that it would be prudent for me to look for a mentor. I didn’t want to waste years fumbling around in the dark so I did some investigation and found a trader based in the UK who had an excellent track record.

The rest as they say is history. It was a great decision and even though my style of trading is different to his now it was a fantastic eye opener and I learned a great deal in the 6 months we had together.

 

2. dondinero: There’s no information about you or your DARWIN on the exchange, e.g. a description of your strategy, a description of the user. Will you tell us something more?

Hi Dondinero. Yes it’s something I have been meaning to get around to. I am a 100% manual trader and utilize Price action at key levels. I mainly trade the major forex pairs and like to trade breakouts from patterns that occur at major key levels. My entries are usually taken of off the 4 hour chart and ideally would run for a couple of days up to a couple of weeks. During periods of consolidation when a pair is stuck between levels I will take trades on the 1 hour time frame and only look to hold for maybe a couple of days. This is the weaker part of my trading and I am currently working on this in the hope of reducing my drawdown and consolidation periods.

 

3. Forexintradia: Hi Twenty Eight, I´ve always respected and admired traders who can handle well low ratio of win/loss trades and keep the discipline. How have you get used to win only 32% of trades and keep it calm? Is it in your personality, is that you trust your backtesting results blindly, or have you gotten some specific training? Congratulations, your performance is great, but your behavior is outstanding, keep it up!

Hi Forexintradia. I believe that discipline is the most important trait to have as a trader and I believe that this is one of my strongest traits. My strategy does not handle periods of higher than usual volatility or choppy price action very well so I naturally go through periods of drawdown or consolidation. It is tough sometimes but I know it’s not going to last and more favourable conditions will return so I have to be patient and very disciplined.

You asked about specific training; aside from the mentoring program I went through I have had a lot of help from a fellow trader who is also a performance coach. She has helped me a great deal with the Pyschological side of trading and this is still a big part of my on going development as a trader. People underestimate the Pyschological side of this business but it’s something I continuously strive to understand.

 

4. FedericoSellitti: You had your worst month in 2019, February, but you also had your best month right after that, March 2019. Did you increase your risk or change something in your strategy?

Hi Federico. The only thing that changed was market conditions. After some weak performance in October and November 2018 I cut back on my risk for December and January then I actually began to see things start changing in February so went back to my usual R/R (which is never to have more than 2% of risk at any one time) but my strategy suffered a few false breakouts. It was very disappointing but was able to capitalize from March onwards when conditions did finally move back in my favour.

 

TDD.4.23

 

5. Tony: How do you prepare your trades?

Hi Tony. Once I have higher timeframe levels marked out it’s all down to how price reacts at these levels. I find weekly price action very reliable and gives a great indication of where price is likely to go and also watch out for patterns to develop at these levels. After this it’s down to the lower timeframes to look for entries and stops.

 

6. Manoj: How do you run on Maximum number of open positions in single direction per instrument, Maximum acceptable exposure in single instrument as percentage of equity, together with swing, scalp and intraday strategies? How do you align all with multiple timeframes?

Hi Manoj. I hope I have understood your question correctly. So I very very rarely have more than 2% open risk at any one time. The last time this occured was in April 2018 when the dollar was breaking out and a couple of AAA+ set ups emerged. My risk there went up to 5% with some very tight stops. It is quite usual for me to have a couple of positions open in the same pair if I’m looking for a good move and I’ll look to close some after an initial burst and then let the rest run.

 

7. Jaico: Do you plan to modify your close strategy to have a better score in the Os attribute? Although the low score of this attribute didn’t prevent you to have a D-score of 74.

Hi Jaico. As I briefly explained to Dondinero I am currently working on refining my strategy. As my equity curve shows I go through periods of drawdown or consolidation which, in my opinion are too extended. As you can see this time around it is so far only a consolidation as opposed to last years drawdown which is good but yes my close strategy during times of market consolidation and changes in volatility are definitely a problem so it is something I am looking at.

 

8. Juan Luis Alcibar: What type of trading do you practice? I’d also like to know what happened during TDD’s stagnation period and if you needed to change anything to get out of the drawdown.

Hi Juan. I think this has already been covered but just to reiterate when going through periods of drawdown or consolidation I just stay as patient as possible. I’ll usually drop my risk a little as well but it’s just a case of discipline and patience. My trade set ups have a fairly high failure rate and although I don’t intend to change anything too drastic, because my winners more than compensate, I am currently working on small changes that will hopefully smooth out my equity curve.

 

9. Antonio: Hey TDD, first of all, congratulations for your DARWIN’s recent results! What return/risk would be a realistic expectation on the long term for TDD? Thank you and congratulations again.

Hi Antonio and thanks. I think it’s tough for a trader to give prognostications of returns but I feel that I still have so much to learn and as a result I believe that I can continue to perform at my current levels as a minimum.

 

10. bianka: Are you analyzing other DARWINs? Which ones do you find mature enough for investing? And which ones do you find promising? 

To be honest Bianka I have been so focused on my own performance that I haven’t really spent anytime analysing other Darwins. However I am well aware that there are some great traders here that are performing very well and it was great to see lately how LVS has come back from almost a year of drawdown. That takes courage, conviction and self belief in what you are doing.

 

11. Juan Luis Alcibar: This is a question to the trader of TDD and to Darwinex. I think TDD is a great DARWIN. Why doesn’t it receive more investment? If I had a lot of money, I’d create a “buy and hold” DARWIN portfolio and TDD would be among the DARWINs I’d include in it. I think Darwinex could create baskets of DARWINs for long-time investors. Curves likes TDD’s offer more trust than spectacular curves which can offer sudden shocks.

Hi Juan and thanks. I’ve had quite a few investors come and go and even had one that invested 50,000.00 Euros in August of last year but I guess that investing can be as difficult as trading is. A lot of traders have no patience or discipline so chop and change all the time which means they never get anywhere and I guess the same can be said about investors. That’s why I think it’s important to see 2 years worth of results before investing and then if you like what you see stick with it. It’s a good idea of yours to have a basket of Darwins to invest in but I have a feeling that Darwinex is already thinking/planning for this. In fact I believe there are some exciting times just around the corner for Darwinex and its top Darwin providers and that’s why I’m working hard to improve my strategy.

 

TDD.4.23

darwin hfd

Interview with HighFive (DARWIN HFD)

We’re happy to present our first trader interview based on questions from the Darwinex community. The interviewee is Hall of Fame current nº 2, HighFive.

HighFive is the manager of HFD, a DARWIN with a track record starting in September 2017 and with its underlying strategy trading at Darwinex since April 2018. In the words of HighFive, it is a…

Manual trading system based on margin zones of participants from the futures market. Additionally, I use market sentiment analysis, volume analysis (trade zones, options, futures contracts) and technical analysis. The average risk per trade is up to 2% of the deposit. Each trade is protected stop loss. I try to hold a stop ratio to a take profit 1 to 2 and above, behind an exception the short-term trading. Type of strategy is trend following after pullbacks. No martingale.

At the moment of writing, HFD has an AuM of more than $3.5M from more than 600 investors which makes it the DARWIN with most investors on the DARWIN Exchange. Some of those investors, and other community members, submitted the questions you can read below together with HighFive’s response to them.

Thank you all, both HighFive and community members who’ve sent questions! Enjoy!


HFD.4.17


Avera: When you created HFD, did you imagine it managing more than 3M? Now that you manage more than 3M, have you changed anything in your trading or thinking compared to when you started the strategy?

HighFive: When I created HFD I was just getting acquainted with Darwinex. Of course I couldn’t imagine how fast Darwin’s capitalization would grow at some point. As for trading and money management, I believe that the principle should be the same for any amount, whether it is on my account $ 1000 or with capital management of more than 3M. Throughout the time, the principle of trading remains the same, but some aspects are improved and refined. Currently, I am thinking about the inclusion of oil in trading. Thinking of course changes as you grow as a trader. I feel responsible in managing such capital. Long ago I realized that you do not need to chase profit. The ideal profit is 30-50% per year. You just need to work by your system carefully analyzing the market and think with your head. This year I improved risk management, reduced risks and tried to improve overall stability.

 

sergyy: How did you start trading? How were your beginnings as a trader?

HighFive: I have been mainly active trading since 2013. I have long been interested in financial direction and asset management. At that time, I was studying professional managers in the financial market and I saw great potential in this. Since 2014, I have tried different systems and methods in the market, looking for my direction, market vision and trading style. I had both ups and downs, but I did not despair, but tried to take into account my past mistakes. Since about 2016 I have been trading on personal accounts using the current strategy and I closed them with a profit in early 2018.

 

Manoj: What are tools which restrict or make caps as per user define eg. 5% used in mt4 though darwinex have their own system of 10% var. How as a trader do you manage risk management specially on loss to not go beyond 5% or control drawdawns as per your choice.

HighFive: I use the EA to automatically calculate the risk for each trade depending on the stop loss. Typical risk is 0.2%-1%. I analyze the market and work by the trading system, during the week or month can be a long series of stop losses. If in the current period trade deals are closed with a loss, just need to accept it and competently continue to work. I try to stick to risk management: 10% maximum drawdown per week and 20-25% maximum drawdown on the underlying strategy.

 

Jose Maria: My analysis of HFD’s return curve showns that after every drawdown, it recovers very fast. This makes me ask whether martingale techniques are applied. Do you use these techniques? If not, how can the described behaviour of the curve be explained?

HighFive: I’m not using martingale methods at the moment. At the beginning of the account creation more than a year ago, I used more aggressive trading methods and some elements of martingale with stop loss. There are strategies that one must avoid, like martingale, grid, hedging, averaging, arbitrage, etc. These are basic principles and I agree with them. However, my opinion is that with competent analysis and risk management, some elements of averaging in a small range can be applied. Sometimes I use some elements of averaging with a common stop, if a high-quality signal is formed for this and the position has a great potential. Sometimes it is in 10-15% of cases. If the market currently does not give the opportunity to open a deal using a pattern or other methods.


HFD.4.17


Husain1: Is there a possibility that you stop trading? Can someone who wants to invest in you for long term be comfortable that you will continue trading?

HighFive: I will definitely report on the community forum if I stop trading. There are currently no plans to stop trading in the near term. I trade while with me everything is good, if something changes I will definitely let you know.

 

Frip: It grabs my attention how fast you recover from drawdowns and get back to you regular ascending line. It happens in almost every drawdown independently from their magnitude. The one ocurring last September 11th stands out mightily. You recovered in just 2 days. Could you explain how you do this? Thank you and congratulations for your good work!

HighFive: Recovery from a drawdown is not always quick. For example, in April this year, the recovery was about 2 months. At the beginning of September this year, almost all instruments had a medium-term trend change, some of the inputs I incorrectly filtered, so Darwin was in a drawdown. I got a big stop loss on gold in long +-2%, then there was a series of stop losses on other instruments. In the second week of September, I held 2 positions on the GBPUSD in long and XAUUSD – shorts. Around September 11-13, there was a big movement in the market and and both deals closed at a good take profit and allowed Darwin to get out of the drawdown at 0. Because of the good stop-to-take ratio. September could well end with a drawdown of 7-10%…

 

Augusto: I would like to know if you use different timeframes or which timeframe do u prefer to operate normally. Thank you very much.

HighFive: Timeframe is a subjective concept. I am working on a compressed chart of the m15-m30 timeframe, this corresponds to the H1-H4 standard in mt4.

 

usiphatheleni: How many demo accounts do you run at any given moment?

HighFive: I don’t have any demo accounts at the moment.

 

usiphatheleni: Do you take breaks from trading and what’s the longest period you have taken?

HighFive: Trading breaks are usually 2 per year when I am on vacation. Usually it is for 2 weeks. The longest is probably during the New year Holidays from December 20 to January 10 in a period of low liquidity and uncertainty in the market.

 

Roshun: How do you find setup with positive expectancy in markets that keep changing?

HighFive: There are basic concepts such as trend, momentum, correction, flat. That never changes. There are statistics that the trend continues with a probability of 70%. The fundamental principles of the trading strategy have been tested for several years and have shown a positive expectation. I use different filters for different stages of the market. The basis of the positive expectations are rigorous risk management, perseverance, consistency and patience.

 

Roshun: How do you maintain or improve consistency in markets that are ever changing?

HighFive: I maintain consistency when analyzing to enter a position. 1) Identification of long – term and medium-term trend and technical picture of the market at the moment. 2) Analysis of certain data from the CME exchange and determination of the current trend according to trading system. 3) Analysis of market sentiment. 4) Search and analysis of expected patterns and formations in the market at the moment. 5) Risk calculation for the expected position. The fundamental principles of the trading strategy remain almost unchanged. However, I am changing and improving some filters based on my experience to improve consistency in changing markets. Also the psychological aspect is of great importance, especially for the manual trader. From my point of view, it is extremely important to have a comfortable risk management, in which losses will not affect further competent decision-making. So I try to maintain and improve self-discipline.

 

Roshun: You have a drawdown of 9.73% over a period of 3 years which is quite commendable. Can you elaborate on what trading process or practice has help you to achieve such a feat? 

HighFive: Please note that the maximum historical drawdown on the underlying strategy was +-25%. At the time, HFD had a” VAR ” of about 25%, so Darwin got a maximum drawdown of 9.73%. I have now reduced the risks and am trying to maintain a “VAR” around 8-12%. The basis of the principles are rigorous risk management, perseverance, consistency and patience. I maintain and improve self-discipline. Analysis of past trades and possible mistakes is also important.

 

Roshun: When you are testing for an edge for a given setup, what is your trade management approach – is it an active or passive one? (Active TM means you managing the life of the trade as per actual market conditions – traders subjectivity might play a role in testing a setup edge. Passive TM means you either have a profitable or loss trade – no subjectivity while testing).

HighFive: First of all, I used the passive method of trade management. I tested the basic principles of the trading strategy on the history, also using the passive method. If I want to test a certain setting on history I also use the passive method. The active method here is difficult to use or even impossible, because some data is missing. If I want to test a particular setup in a real market scenario, I use the active method. The method of conducting a trade deal is determined by many factors. For example “after taking a position, the market is stalling too much does” I will not close the position if there is no reason for it and will hold the trade until stop loss or take. However, if there is a signal to stop the current trend, then I can adjust the position, partially or completely close or move to breakeven. For example, the change of market sentiment or the scrapping of the technical medium-term picture of the market. It is also possible to change the current trend according to the trading system, with open positions in the opposite direction. I agree that with an active method of trade management, subjectivity might play a small role in a testing setup. I think it’s part of risk management.

 

Spingalex: What are all the factors that guided you to be a manual trader and not an automatic trader?

HighFive: I initially traded manually, and then only tested some automatic strategies and methods. I’m not a professional programmer. My conclusion was that most of these systems only work in a certain interval in the market. For example, most impulse and breakout systems have been in a drawdown for the last 1-2 years and are just beginning to come out of it. I understand that there are professional algorithmic traders and they are constantly improving their system and have a positive expectation on the distance. I just like manual trading, I like to analyze the market and everything related to it. I am not sure that my trading can be fully automated. Of course, I would like to partially automate my trading to have more free time.

 

Alex: Have you studied or trained to be a trader? How / what were those studies or training programmes?

HighFive: I studied on my own (I’m self-taught). However, I am grateful to one experienced trader, in due time thanks to him I radically changed the approach to market analysis and risk management. The program is probably only a EA “manual strategy tester for MT4”. The most important thing is practice and trading on a real account.

 

Shivank: What book you will suggest to the traders who want to learn and understand market moves?

HighFive: There are many books and texts about trading but in my experience, beyond the most basic concepts, real knowledge can’t be obtained from book. First you need to study technical analysis. Practice and a systematic approach will allow you to understand the market movements. I would advise you to practice more on a real account and look for your trading style. Perhaps such books: “The Psychology of trading” by Brett N.Steenbarger, “Enhancing Trader Performance” and “Market Wizards” by Jack D.SCHWAGER”. But they’re more psychological.

 

yusifkunat: if it’s not a secret – what exactly are “margin zones of participants from the futures market”

HighFive: Margin zones on Forex are margin call levels established by the short-term (intraday) and medium-term requirements of the CME exchange, which relate to positions carried every other day. You can be found more detail at the CME exchange website.

 

yusifkunat: Interestingly, equity curve of HFD usually is trending up slowly with low fluctuation, but then sometimes huge spikes appear down and up in short time: can you tell the background of such sudden changes on “behaviour” of equity curve?

HighFive: This is due to the fact that the market changes periodically and sometimes there is a consecutive long series of stop losses. At the same time, several good deals closed on take profit with a good stop-to-take ratio allow Darwin to get out of the drawdown.

 

bianka: Are you yourself investing in your own or other DARWINs? If yes, how have you done so far as an investor?

HighFive: I invest in other Darwins, but relatively recently, about six months ago. I made some profit. At the moment, the result is about zero. Darwinex is a great investment platform, but I don’t have enough time to fully analyze other Darwins.


What do you think about this way of featuring traders? Any suggestions for improvement? Any particular trader you’d like us to interview?