Topic: Is it really awful to have a higher SL than TP?
I've recently started "forcing" all my Generated bots to have SL/TP/BE. I find the optimal value manually, and then I let Optimizer have a go at it as well (it doesn't always outsmart me lol).
Only when I reach the END of a bots development am I able to see how these optimal settings will shake out.
On a couple bots that have really sexy equity curves, I am a little bit dismayed to see that SL is higher than the TP. Is this really such an awful thing? I'm curious your thoughts on this.
In some ways, I don't think it is relevant because the bot will still close positions before they reach their SL/TP levels (for example, I could turn off the SL/TP/BE and the equity curve would still look great -- so definitely not using SL/TP as a primary exit method). Those are mostly in place for the extremes I think. But traditional trading usually dictates that you would always have a TP higher than SL, and preferably much higher.
This seems loosely related to the concept of Expectancy as well, but again, it is not a perfect fit. I think Expectancy can really only be calculated when there are known exit levels. I would argue again that the permanent SL/TP/BE levels are more for extreme protection, and not typically reached under normal conditions.
What do you think?