Below, I am pasting verbatim what I posted on the topic on my thread in Traderji. Note the need to deploy full capital to get the results indicated. As mentioned in the post, a high win % and low risk per trade would be great. However, I am now thinking that high Recovery Factor and low risk per trade would be a better criteria to give the confidence to deploy maximum capital.

Recovery Factor = (Net profit) / (Maximum system drawdown)

The Power of CompoundingNF is at 7700. If you are able to net 10 points per day, then you are earning 3.24% on margin on MIS basis, and 1.62% on NRML basis. If you have a ,
then with NRML your capital would have multiplied 24 time in an year.
With MIS, then your capital would have multiplied 588 times.high win %, and low risk per trade, and deploy full capital on each tradeI am assuming that you are able to trade 200 days in a year. If you earn 0.1% of capital everyday, compounding your capital will make it 1.22 times after 1 year. If 0.2%, 1.49 times. If 0.3%, 1.82 times. If 0.5%, 2.71 times. If 1%, 7.32 times. If 2%, 52 times. If 3%, 369 times. If 4%, 2550 times. If 5%, 17292 times. If 6%, 115125 times. If 7%, 752931 times. If 8%, 4838949 times. If 9%, 30570292 times. If 10%, 189905276 times. Get the drift? Now don't find excuses. Just do it |

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