After a little bit of time off to relax and enjoy the holidays, it’s time to kick it back into gear for 2015, starting off with a review and reflection of my Q4 2014 performance.
Basic Forex Trading Stats
Total Number of Trades Ideas for Q4: 12
Breakeven/No Trade: 4
Win % (winning trades / triggered trades): 75.00%
Average Winning Trade in %: +0.49%
Average Losing Trade in %: -0.71%
Largest Drawdown: -0.71%
Total Q4 Blog Profit / Loss in %: +1.53%
Total 2014 Blog Profit / Loss in %: +3.57%
Looking back at my fourth quarter, it was pretty clear that my big win percentage had a lot to do with my strong bias for going long the Greenback. 10 out of 12 of my ideas were USD long biases, resulting in 6 winners, two losers (USD/JPY long and USD/CHF long), and the other four were “no trades/breakeven.” With the Fed ending QE, the U.S. economy showing improvement, and price action favoring the Greenback, it was common sense to play those ideas when the fundamentals and technicals lined up. And more often than not, it worked out pretty well.
While the quarter turned out positive, there were a few things I could have done better:
- Keep consistent with my risk per trade. My two best trades in terms of return-on-risk were both GBP/USD shorts, and coincidentally, those were the only two triggered trades where I went with only 0.50% risk vs. my usual 1.00% risk. Instead of 0.50% gains on each, they could have added another full 1.00% to the bottom line performance.
- Cut my losses quicker. In my USD/JPY long loss, I recognized the shift to risk aversion but didn’t cut the loss quickly enough. It was a 0.71% loss that could have been cut down to only 0.30% – 0.40%, again adding a nice chunk to the bottom line.
- Holding onto winners. The U.S. dollar had a heck of a run in Q4, and I should have managed my trades better to weather the pickup in volatility and hold on to what could have been big winners.
Overall, I’m pretty happy with how I performed, not because I came out positive but because I think I executed pretty well. I stuck to my system of combining fundamentals and technicals, and focused on managing my risk after I got into the trade. I kept it simple and didn’t really over think the process. That’s really all I can control, and when the market does goes my way, it can be a positive for my trading account.
With the +1.53% fourth quarter gain, this forex learning blog performance finished up +3.57% for the year on 17 wins, 10 losses and 12 no trades.
This puts me in the mix with the benchmarks that I like to measure my performance against: the Barclay Hedge Currency Traders Index (+2.52% YTD thru the end of Dec.) and the Barclay Hedge Discretionary Traders Index (+0.72% YTD thru Dec.). Besides consistent profitability, consistently outpacing the “pros” is a long-term goal, both of which I still have many, many, many years of practice to go (and hopefully a lot of luck) for me to achieve.
That’s all I got for now forex friends…How did you do in 2014? Please share your thoughts in the comment box below. Thanks for stopping by and good luck in 2015!