The Five Minutes a Day Trading strategy had its first losing month in February. The strategy fell short of the minimum target of seven successful trades. Five winning trades meant the month finished down 25 points. A disappointing result.

This is by far the hardest monthly wrap up to write. It’s true there were many near misses during the month. On four occasions, the trade missed an entry or take profit level by 0.2, but near misses do not add to profits, and good traders do not make excuses. So the February campaign is added to the record and the 5MADT strategy moves on:

20140304 camp summHere’s the full record of trades for the month. Blue prices are entries, red numbers are stop outs, and greens are successful take profit prices:

20140303 results

  • For the first time, winning trades did not cluster – they were spread evenly through the month. This might indicate the premise underlying the selection of the UK 100 index was flawed, as previous clustering may have meant trading conditions persisted for a period.
  • The strategy was in negative territory for 19 of the 20 trading days, yet the even spread of wins meant the maximum draw on capital was 34 points. However, capital efficiency is a poor second prize to profit.
  • An even balance between buys and sells – ten each, despite the fact that the market rose by almost 400 points over the first three weeks of the campaign.
  • On a number of the trading days, the market fluctuated for the first hour and then set the direction for the day. This alone caused a number of stop outs. A number of traders pointed out this effect. I’ll hand this one to Leo the quant for analysis, but am interested to hear from anyone who has a theory as to why this occurred. (I have already double checked that it is not due to differences in daylight saving).
  • A new platform feature means the analysis may be varied. Traders now have more control over the triggering of stop entry and stop loss orders, by specifying whether the order is triggered by the buy price, sell price or mid-price. This meant my account showed a profitable trade on days when others were stopped out (I use the mid-price, setting an appropriate boundary price). For the purposes of tracking, I assumed the worst case. Please comment below if you had a profitable trade on a day where the official record is a loss.

This ends our daily reporting on the strategy, but of course any trader could implement the strategy in the future. Here’s the strategy outline for those looking to do their own calculations.

Now I’d like to hear from any traders who followed the month. Did you use the strategy? Did you modify it? What was your experience? Do you have any suggestions for improvement?

Soon we’ll start the search for the next 5MADT instrument, for a new campaign. Have you noticed any market quirks for Leo the quant to investigate?

Finally, thanks to all those who generously contributed their views, thoughts and comments throughout the month.