IG’s Trade of the week: up hypothetical 31.45% in 2024
IG’s Trade of the week: up hypothetical 31.54% in 2024 whilst risking 2% per trade and only being right around half of the time.
What is ‘Trade of the week’ and how to access it?
The idea behind ‘Trade of the week’ is for IG’s UK market analysts Chris Beauchamp and Axel Rudolph to show potential and actual traders how to place a trade, decide on where to place stop loss and limit orders while incorporating sound risk and money management techniques.
All setups and trade ideas in the weekly ‘Trade of the week’ videos are hypothetical and are not being traded with real money by IG’s market analysts.
They are recorded each Monday morning and can be seen on the main IG UK website as an article under ‘News and Trade Ideas’, on MyIG under both the ‘News’ and ‘Videos’ sections, and also on IG's YouTube channel.
IG’s Trade of the week: why only risk 2% of capital per trade
2024 built on 2023’s +22.67% hypothetical gain and came in at +31.45%.
Percentage gains and losses always need to be viewed in context, though, since the numbers on their own do not mean anything. Someone making a gain of 31% in the course of a year but who risks for example 10% per trade might just be lucky (and is almost certainly going to wipe out their trading account at some stage in the future as they are risking too much capital per trade).
At IG we never risk more than 2% of a £10,000.00 demo account’s trading capital per trade, to which a 0.01% spread is added. It is important not to risk more than 2% per trade as a series of consecutive losing trades is bound to happen at some stage during a year. If or when this occurs, a trader doesn’t want to experience a large drawdown (how much a trading account is down from its peak before it recovers back to the peak).
In July, for example, four consecutive ‘Trade of the week’ setups hypothetically lost money, amounting to an around 8% drawdown. In this example a trader would need a 9% gain to get out of their drawdown.
Weekly ‘Trade of the week’ 2024 setups
When delving into the 2024 stats, one can see that monthly gains of around 11.5% were made in January and November, more than making up for the 8% drawdown.
Had 10% per trade been risked (instead of 2%), the hypothetical drawdown would have been around 40%. In this scenario a 67% gain would need to have been made in order to get back to break even.
IG’s Trade of the week: up hypothetical 31.45% in 2024
Even though a hypothetical +31% gain has been achieved during 2024, only around half of the trade setups were positive.
Nine trades started off in positive territory, but since IG’s analysts move their stop losses to break even once a market starts heading in the right direction, were stopped out at break even. These trade setups, in effect, were turned into risk-free trades as a guaranteed stop loss at the original entry level would not have triggered a loss.
21 trade setups were profitable and 20 were not. IG’s analysts were thus right in their trade setups only around half of the time, yet a significant hypothetical +31% year-end gain was achieved.
2024 ‘Trade of the week’ monthly P&L stats
Eight months ended up in positive territory, four only marginally so, and four months in negative territory. Just like for each weekly trade setup, the average win was far larger than the average loss, hence the over 31% hypothetical year-end gains despite only being right around half of the time.
The average monthly loss came to -4.51% whereas the average monthly profit to +6.01%.
2024 ‘Trade of the week’ monthly return graph
The average gain per trade came to £362.84 and the average loss to £223.72, a positive ratio of 1.62. This means the average winning trade was 1.62 times greater than the average loss.
2024 ‘Trade of the week’ per trade return graph
By being disciplined at all times and never losing more than approximately 2% per losing trade but on average making 1.62 larger gains on the winning trades, doing so by being right around 50% of the time, the +31.45% hypothetical 2024 year-end profit has been achieved.
IG’s ‘Trade of the week’ 2024 summary
Despite being right around half of the time with regards to picking winning trades, IG’s analysts have demonstrated that with sound risk and money management a significantly profitable end of year result can be achieved.
This information has been prepared by IG, a trading name of IG Markets Ltd and IG Markets South Africa 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. See full non-independent research disclaimer and quarterly summary.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only
