Trading the trend: How did we do in 2023?
Having closed out our last hypothetical trade of the year we are up over 12% for the year. Let’s have a look at our monthly profit distribution, reward/risk ratio and how we manage risk.
(AI Video Summary)
Ending the year's trades with a tidy profit
In the final "Trading the trend" episode of 2023, Axel Rudolph talks about his trading strategies and how he managed his risks throughout the year 2023. He uses a hypothetical £10,000 account to demonstrate his performance. By looking at a colorful chart, we can see that he had some months where he lost money, but he also had months where he made money. Overall, he ended the year with a 12.5% profit. That's pretty impressive!
Even though he had more losing trades than winning trades, he still managed to make a profit. He mentions that about 12% of his trades couldn't be entered or were stopped at break even. But the important thing is that his profits were bigger than his losses. He never risked more than 2% of his total capital in each trade. For example, if he started with £10,000, he would only risk £200 for the next trade. Even if his account balance went below £10,000, he still stuck to that 2% rule.
Aiming for bigger rewards
One interesting strategy he used was aiming for bigger rewards compared to his risks. On average, he tried to make three times, two times, ten times, and four times as much as he risked in different trades. This means that if he risked £100, he aimed to make £300 or more. By doing this and being right more often than not, he was able to achieve that 12.5% profit at the end of the year.
Rudolph ends the video by thanking the viewers and expressing his excitement for more trade setups in the coming year. He's looking forward to sharing more strategies and opportunities with the audience.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
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