Topic: Porfolio Drawdown

Hi, I'm testing a portfolio of 100 EURUSD EAs.

As you can see the drawdown is about $8k (30%). My account setting is 10000 USD, and EA lot size is 0.1

Does that mean, if in worst senario, the drawdown happened right when I start using EAs, I will lose 80% of my account (8k/10k)?

If for example, after I reach 20000 USD, and increase my lot size to 0.2, I can also lose 80% of my account at that moment.

Thank you.

Re: Porfolio Drawdown

Hi moduoitroitho, is there supposed to be a picture attached? It's a bit hard to make out what you mean from your post.

In percentage terms, if you have a $10,000 account and you are trading 0.1 lots, the drawdown in % will be the same as if it was $20,000 and 0.2 lots, using absolute dollar figures though it will be double.

Co-founder - Blue Capital Trading (https://www.bluecapitaltrading.com/)
Need help managing a portfolio of hundreds of trading strategies? Check out Strategy Samurai

Re: Porfolio Drawdown

burrup.lambert wrote:

Hi moduoitroitho, is there supposed to be a picture attached? It's a bit hard to make out what you mean from your post.

In percentage terms, if you have a $10,000 account and you are trading 0.1 lots, the drawdown in % will be the same as if it was $20,000 and 0.2 lots, using absolute dollar figures though it will be double.

sure, you can see my image here https://ibb.co/TKcrYVR.
I just doubt because the drawdown is more than 8k, if it happened right after I open my account (10K) or after I reach 20k and increase my lot size, then I can witness more than 80% drawdown, is it correct or not

thank you

Re: Porfolio Drawdown

What lot size did you generate the portfolio with?

You set $100,000 as the portfolio amount. It has a drawdown of approx. $8,000 (30%). If you generated the portfolio using 0.1 lot size, and you want to trade it on a demo or live account of $10,000, you should decrease the lot size to 0.01. This will make sure your maximum historical drawdown will stay at 30% (approx $800 on a $10,000 account).

$100,000 / 10 = $10,000
0.1 lots / 10 = 0.01 lots
$8,000 / 10 = $800

If you want to keep approximately the same risk, on a $20,000 account you would use 0.02 lot size.

Co-founder - Blue Capital Trading (https://www.bluecapitaltrading.com/)
Need help managing a portfolio of hundreds of trading strategies? Check out Strategy Samurai

5 (edited by moduoitroitho 2020-09-14 13:55:20)

Re: Porfolio Drawdown

Thank you so much for your advice