Understand the Principle of Reversion to the Mean and Skyrocket Your E-Mini Trading Profits


I am very fond of the RTM e-mini eraser and have found the metrics in many successful e-mini contracts. Nope, that’s not me; But background checks and careful scrutiny of results over the years have corrected my calculations to the point that this strategy has increased percentages in the 70% + range. For a number of years now, I have documented all business and every business situation. To name a few, listing, trending, improvement, profit targets, stopping loss points is a very cautious disease but electronic profit is on the list.

What exactly is a return to average business?

I can divide RM business into three basic concepts that range from A-mini contract to contract. In my experience, I want to understand that it is better to go back to the average when selling products, especially indexes.

· Determine the average market price over a period of time. I use a simple moving average to do this. Usually anywhere between 175-250 times is a good starting point. When looking at market personality changes, a background check on any contract is important. For example, fast-paced markets may require variables in your calculations. On the other hand, there is a need to move the markets and make a small adjustment to the side markets.

The next step is fairly simple and straightforward; Note the “issuers” during the specified period. At some point, the market price tends to move away from the SMA. At first I used a scattered graph and over time I improved that process to some extent.

· Prices move away from the average to the point where the transaction is moving. To achieve this, I use two bands set to a standard error signal through a background test. The inner line can be set to Sigma 1.7-2.5 and the outer line reflects the input of 2.8-4.0 depending on market behavior. Painting the space between the two standard distortion settings results in a band above and below the average, which turns yellow for easy identification. I do not need to check the groups every day unless there is a significant change in market behavior. My unscientific assumption is that I will pay the bandages every three months or so.

It is really easy to trade the bands as prices move to the upper or lower bands. When the price starts to move to average, I take bands. When there is a trend, it is important to remember to take costs that go in the direction of the trend. Although e-contracts are said to be back in business, the percentage is not as impressive as trending traders.

Not all is easy. Any rotation will explode through any standard deviation setting and they hope you will not trade in the sharp opposite direction. Spirals affect all types of trading systems and are therefore a risk to all traders. On the other hand, the news media can cause some abortions. When it comes to advertising, most e-commerce tends to be out of business. But it is especially good news that you can increase the price and send it through your pure small business bands.

You may be wondering, why not just use a bowlinger band indicator or a Celtic channel. In my opinion you can do the same thing on both devices. However, they seem to greatly improve my results by creating my own bands and adding specific criteria for group activity.

In conclusion, I suggest that incorporating the reverse into the average strategy gives you a better chance of being profitable. We’ve looked at some of the criteria I use, and I suggest doing a few back-to-back tests to find some acceptable tolerance. Finally, we looked at a way to trade the data generated by our parameters.