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Calculating trades in R
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Calculating trades in R

  #1 (permalink)
Sydney,NSW,Australia
 
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Calculating trades in R

Hello,

I am recording my trades in google sheets and include usual data like open price, close price profit/loss in pips etc but would like to also start recording my profit/loss in R.

I am trying to find information how to calculate it automaticaly in Google sheets or Excel but so far no luck.

If anybody here is willing to help could you please point me to a website or information how to use calculation formula to calculate my trades in R?
Thanks a lot.

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  #2 (permalink)
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  #3 (permalink)
Legendary Market Wizard
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You mention R, Google Sheets and then Excel. R is statistical heavy scripting programming language and nothing like a spreadsheet. There are some R packages designed especially for financial modeling of trading (QuantMod being the most popular I think) but I don't think that's what your looking for. You could perform the calculations you want in R, but I think it would take a lot more work than many better available options (like spreadsheets). What exactly are you trying to automate? If you really are determined to use R, RStudio is a good place to start.

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  #4 (permalink)
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Or if you mean the Van Tharp version of 'R' for Risk multiples, then just divide the profit/loss of a trade by the risk per trade.
So if a trade made $200 and the total risk was $100, the trade has an R multiple of 2R. If you risked $200 and took a full stop for -$200 then that is a -1R trade.
Google "Van Tharp R multiples" will give you lots more if that's what you want.

Or sometimes people who aren't using firm stops (except maybe a hard safety stop just in case of platform or internet problems), could use the Maximum Adverse Excursion (MAE), of a trade instead of initial risk. So if trading two contracts say on the ES with an example trade which goes two ticks negative then gets a scale out at one point and the second contract at two points. That would be $50 Risk/MAE in total and $150 profit, so a 3R trade.

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  #5 (permalink)
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arrrgh!

I prefer to collect a sample of risk experience measured in MAE.

R, as I understand it, can be determined by a single bar in a pattern and seems more arbitrary. maybe because its more variable. Whereas the pattern as a whole will produce a distribution of MAEs that can be used to set risk behind the fat part of the curve. Same goes for target setting.

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  #6 (permalink)
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matthew28 View Post
Or if you mean the Van Tharp version of 'R' for Risk multiples, then just divide the profit/loss of a trade by the risk per trade.
So if a trade made $200 and the total risk was $100, the trade has an R multiple of 2R. If you risked $200 and took a full stop for -$200 then that is a -1R trade.
Google "Van Tharp R multiples" will give you lots more if that's what you want.

Thanks a lot to all of you guys.

As Mathew28 pointed I am after simple calculation of R when entering my open, SL and TP prices in google sheets.

I know this site is mostly about futures but I trade mainly forex so I was hoping to find something to help me and simplify whole process of entering trades and recording R.

For example if I enter buy trade
Entry price : 1.3000
SL : 1.2900
TP: 1.3100

...and then also have "R"column

Then in case the price will hit TP and I enter 1.3100 in "close price" ideally it would automaticaly calculate my "R".

Now because I dont have this formula and dont know how to do it I have to manually calculate as Matthew28 suggested above - divide profit/loss by risk.

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  #7 (permalink)
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Kennard View Post
Thanks a lot to all of you guys.

As Mathew28 pointed I am after simple calculation of R when entering my open, SL and TP prices in google sheets.

I know this site is mostly about futures but I trade mainly forex so I was hoping to find something to help me and simplify whole process of entering trades and recording R.

For example if I enter buy trade
Entry price : 1.3000
SL : 1.2900
TP: 1.3100

...and then also have "R"column

Then in case the price will hit TP and I enter 1.3100 in "close price" ideally it would automaticaly calculate my "R".

Now because I dont have this formula and dont know how to do it I have to manually calculate as Matthew28 suggested above - divide profit/loss by risk.

In this case it is simple (TP-Entry)/(Entry-SL)

(TP- Entry) is your profit or loss, (Entry - SL) is your risk. This is only for long trades, for short trades it is
(Entry-TP) /(SL-Entry).

It is better to say Exit to your TP.

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  #8 (permalink)
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Guess I missed the boat on this one!

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  #9 (permalink)
Sydney,NSW,Australia
 
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matthew28 View Post
So if a trade made $200 and the total risk was $100, the trade has an R multiple of 2R. If you risked $200 and took a full stop for -$200 then that is a -1R trade.

Are my calculations correct?

124 profit / 100 risk -> 1.24R
-58/85 -> -0.68R
278/100 -> 2.78R
-75/130 -> -0.57R

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  #10 (permalink)
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Kennard View Post
Are my calculations correct?

124 profit / 100 risk -> 1.24R
-58/85 -> -0.68R
278/100 -> 2.78R
-75/130 -> -0.57R

Yes those are all right. So along with the Profit/Loss column you already have in your spreadsheet, just add a couple of extra columns. One where you manually input the Risk in dollars for the trade and one with a simple calculation that divides the Profit/Loss column with the Risk column.
The only thing to be aware of is whether your trade results P/L are per contract or for the total trade. ie if you enter two lots say in the ES with a two point stop and you make two points with one contract and four points on the second contract, does your platform list that as one trade (each contract separate), or as one trade. If individual contracts your risk for each contract would be $100 (two point stop at $50 per point on the ES), but for the trade as a whole your risk column would be $200 for the two contracts.

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