Mark Holstius Elite    Posts: 744 Joined: 10/11/2012 Location: Sleepy Hollow, IL  User Profile | Some of these are fairly transparent: Minimum Price/Share, Min Avg Daily Volume, etc. However, 2 settings in particular (“Allow settings to reduce trade size” & “Maximum Exposure % per Symbol”) have a large effect but are difficult to analyze once an account has been trading for a while. I’ve found that by looking at the trades taken in the first few days an account is open gives insight into the behavior of these settings and what they accomplish. I’ve taken the same account and started “trading” on 1/1/2007 with 6 different combinations: “Allow Settings…” both Unchecked and Checked and “Max Exposure…” at 10%, 20%, & 30%. With “Allow Settings” Unchecked, increasing “Max Exposure” allows strategies with increased QTY% to fire and be filled (1-3 below). At 10% 20 trades are taken / at 20% 25 trades are taken / and at 30% 29 trades are taken over the same period. With “Allow Settings” CHECKED, the same # of trades (29) is taken at all 3 “Max Exposure” levels. The lower “Max Exposure” limits in #1 & #2 constrain the QTY% to the “Max Exposure” chosen (10% or 20%) for strategies that would normally have higher QTY% entries. There are some strategies in OV that use 35-40 QTY%, so it might be “disconcerting” to enter a trade with 35% of your capital – but you can choose to limit your exposure in trades by using the “Max Exposure” setting. By checking the “Allow settings” box at the same time, you can include the trades from those higher QTY% strategies at a lower QTY% for the trade. Knowing the logic that’s working with these 2 settings, here are the results of trading with these 6 different combinations of settings from 1/1/2007 – present in the same account. No other account settings were checked or used for these runs other than the "Allow Settings...", "Maximum Exposure...", and commissions. These settings have an obvious effect on both risk and reward. Thanks for the education, Steve… Mark [Edited by Mark Holstius on 1/21/2014 6:41 AM]  Attached file : Account_Settings.jpg (3708KB - 701 downloads) Attached file : Account_Setting_Results.jpg (1514KB - 668 downloads) |
