Enhancing every multiday strategies with Swap-Based Adjustments
Hello CPtizens,
Swaps, those often overlooked factors, can play a pivotal role in our trades. They can be both negative and positive, and here's a proposal: What if CP could adapt their behavior based on swap rates?
Imagine this (only ideas) - when swaps are positive, our EA extends the exit or trailing stop, stop loss to capture more profit; or perhaps using only a breakeven for carry trading a little bit and after x days switch to trailing?!. Conversely, when swaps turn negative, the EA becomes more inclined to reduce trades' duration to mitigate potential losses.
Why is this advantageous?
- Maximize Profits: Positive swaps mean more profit potential. This approach allows us to squeeze out every bit of advantage when swaps are in our favor.
- Risk Management: Negative swaps can erode profits quickly. Allowing the EA to act decisively protects our capital, preventing unnecessary losses.
- Flexibility: Monetary policies changes, and so should our strategies. Swap-based adjustments make our EAs adaptable to evolving market conditions.
- Efficiency: EAs can respond to swap changes much faster and efficiently than humans, maximizing opportunities and minimizing risks.
- Competitive Edge: Staying competitive in the trading world is vital. This innovative approach could set you apart in the markets.
So, what do you think about this idea? If you like it, let's discuss how we can make CP smarter and more adaptable to enhance every multiday strategies.
Got it! No problem. I initiated this discussion not to make a specific request but to kickstart a collective conversation about swaps, carry trading (already addressed in scientific literature) and possible ways for capitalize them with CP.
Manually adjusting parameters becomes inconvenient when implementing a bidirectional strategy on the same asset. For instance, let's consider the current USDJPY scenario with 1 lot size. When I (or a strategy) go long, I'm currently earning a relative good ammount of USD in Swap (circa 10 USD/day), but when I go short, I'm incurring a relatively high cost due to the swap (-18 USD/day). Manually changing these parameters every time a strategy dictates a long or short position can be challenging, especially if one work on different pairs.
As for the Wednesday strategy, my intent was precisely the opposite: to formulate a strategy that opens short trades exclusively on Wednesdays, to capitalize the triple positive swaps.
Thank you anyway for the time you've dedicated. Cheers! ^^
Thanks for your ideas!
If you specify the exact rules you want to add and find some supporters, we can certainly improve the EA.