Value At Risk Channel [AstrideUnicorn]The Value at Risk Channel (VaR Channel) is a trading indicator designed to help traders control the level of risk exposure in their positions. The user can select a time period and a probability value, and the indicator will plot the upper and lower limits that the price can reach during the selected time period with the given probability.
CONCEPTS
The indicator is based on the Value at Risk (VaR) calculation. VaR is an important metric in risk management that quantifies the degree of potential financial loss within a position, portfolio or company over a specific period of time. It is widely used by financial institutions like banks and investment companies to forecast the extent and likelihood of potential losses in their portfolios.
We use the so-called “historical method” to compute VaR. The algorithm looks at the history of past returns and creates a histogram that represents the statistical distribution of past returns. Assuming that the returns follow a normal distribution, one can assign a probability to each value of return. The probability of a specific return value is determined by the distribution percentile to which it belongs.
HOW TO USE
Let’s assume you want to plot the upper and lower limits that price will reach within 4 hours with 5% probability. To do this, go to the indicator Settings tab and set the Timeframe parameter to "4 hours'' and the Probability parameter to 5.0.
You can use the indicator to set your Stop-Loss at the price level where it will trigger with low probability. And what's more, you can measure and control the probability of triggering.
You can also see how likely it is that the price will reach your Take-Profit within a specific period of time. For example, you expect your target level to be reached within a week. To determine this probability, set the Timeframe parameter to "1 week" and adjust the Probability parameter so that the upper or lower limit of your VaR channel is close to your Take-Profit level. The resulting Probability parameter value will show the probability of reaching your target in the expected time.
The indicator can be a useful tool for measuring and managing risk, as well as for developing and fine-tuning trading strategies. If you find other uses for the indicator, feel free to share them in the comments!
SETTINGS
Timeframe - sets the time period, during which the price can reach the upper or lower bound of the VaR channel with the probability, set by the Probability parameter.
Probability - specifies the probability with which the price can reach the upper or lower bound of the VaR channel during the time period specified by the Timeframe parameter.
Window - specifies the length of history (number of historical bars) used for VaR calculation.
Riskmangement
Future Risk CalculatorCreated out of revenge against the difficulty of controlling psychology, greed, and risk management. Designed for cryptocurrency futures trading by following the risk management principles from Kevin Sailly. Very welcome if there are suggestions and input to improve the quality of this "indicator". Please use wisely.
How to use:
1. Open indicator settings.
2. Fill out all the forms. (Note: I make Max Loss Risk only has 5 options. Because, you know, to control the greed. You can choose by considering your risk profiles and market condition)
3. All of the information and calculation will appear on the label (right side of the bar chart) and top-right box.
4. You can adjust the three prices (target, entry, and stop) by clicking any part of the indicator. There will be three dots in the middle of the chart window (align with three prices). Click that dots and drag them up/down to customize according to your wishes. The price order must be correct, for LONG direction the price order from the top is target-entry-stop. Vice versa for SHORT direction. There will be "SETUP ERROR" text in the top-right box if the price order is not correct.
"Never, ever argue with your trading system." (by Michael Covel)
Regards,
Ircham
PhinkTrade Risk Manager EssentialsHello there, fellow traders!
So, happy to bring you a new, free tool: my Risk Manager Essentials .
(To use it, click on "Add to favorite indicators" below, and then look for it in your charts’ "Indicators & Strategies" dialog window, inside "Favorites" tab.)
The main objective of this indicator is to help and incentivize as many traders as possible to adopt essential risk management practices .
First and foremost, it helps you define how much you can buy or sell, at your chosen price levels, in order to keep your risk always under control (in other words: in order to limit the amount you can potentially lose with a trade if your stop loss order is hit).
This is fundamental if you want to have a lasting and successful trading career: protect your capital, always . Because without it, you know: it’s game over.
Indicator also helps you visualize where minimum ideal target / take profit level is , given your risk, using the popular 3:1 Return/Risk ratio (R/R) .
3:1 R/R ratio is popular because with it you only need to “be right” (have price reach your targets) about 33% of the time, in order to be profitable : in other words, the fewer successful trades will pay you more than the sum of your unsuccessful ones will take from you.
So, make sure your strategy has a success rate greater than 33% and apply 3:1 R/R to your trades . This indicator will help you that, and with developing the necessary discipline . For example, by knowing where the ideal target should be, given your choices, you can assess the likelihood of it being reached in current price context. If that would look like a hard to happen scenario, it would probably be a good idea to avoid taking that particular trade.
Now, let’s see how it works:
When you deploy the indicator to the chart for the first time, you’ll be asked to define:
Your 1st entry price (interactively: you can define and adjust levels directly on the chart, thanks to the new Interactive Mode introduced by TradingView (ty, TV team!))
Your stop loss price (likewise)
Your 1st target price (likewise)
Your starting capital (via initial Input dialog)
Your risk (likewise)
Your risk is how much of your starting capital you are willing to lose if your stop loss is hit (define it as a % of your starting capital).
There’s a good practice here too: to risk only 1 percent of your capital per trade . This way, you can reinforce the odds of making more money than you lose and keep your peace of mind in all trades – and avoid messing up with your plans – and statistics – along the way.
Successful trading is a statistics-based endeavor. So, you want to implement and maintain consistency. Again, this indicator helps with that.
After initial setup:
You can also define additional entries and targets (up to 3 each) . Just open indicator’s Settings window and adjust accordingly.
If you have more than one entry – or target, the amounts involved will be split evenly between them. You can also enable the display of the Average Entry and Average Target labels , to see the equivalent, should you have taken (or take) a single order for each.
You can also define (via Settings, then interactively) a particular date and time for the trade . This way, labels will be presented near that moment, instead of constantly show near the latest bar.
Finally, you can personalize some other display settings: levels precision (number of decimal places), labels positions , and labels colors .
In conclusion:
You are very welcome to check it out – and adopt it on your daily use!
Please let me know your feedbacks as well. If you find any issues, or have any suggestions, I’ll be glad to hear. You can contact me here, via TradingView, or Telegram.
Finally, check the updates section below , as new stuff may show from time to time.
Thank you very much for your attention, and enjoy!
PhinkTrade
Volume calculationHello friends
First let me say that my English is poor and I am using Google Translator 😬🙃🙃🙃
Secondly, this indicator is open source and its use is allowed in its indicator, but in order to play it, my name must be mentioned.
Well, let's go to the description of the indicator :
This indicator gives you the amount of purchasing volume in relation to the capital, the risk you trade and the stop loss.
And shows you the LRP
I hope you use the indicator well
Your pocket is full of money
Let me say that I am Iranian
