The Two System Portfolio trades NQ V-Reversal ATS and NQ Gap Continuation 2020. Understanding expected gains versus risk is one of the most important concepts to understand when managing an active trading program. Micro-managing strategies inside normal performance cycles can have the same effect as discretionary trading. The two equity curves represent the hypothetical trading systems results for NQ V-Reversal ATS and NQ Gap Continuation 2020 through this morning (4/28/2026) Trade.
This current drawdown reminds me of the drawdown level when we started the live Auto Trade results in 2024. (see below).
NQ V-Reversal ATS
Hypothetical Performance Summary
(1/1/2017 - 4/28/2026)
$25 round turn slippage and commission
NQ Gap Continuation 2020
Hypothetical Performance Summary
(1/1/2017 - 4/28/2026)
$25 round turn slippage and commission
Principles to Understand:
-Start after a drawdown cycle or series of losers. This will buffer worse case drawdowns.
-Don't start in a euphoric state of mind at equity peaks.
-Systems degrade over time and we anticipate worse case drawdowns in the future.
-Exceptions to this are backtesting methods that do allow you to beat the original strategy using systematic money management algorithms.
-Markets can have unprecedented price action for a season that generates better than average performance or worse than average performance.
Questions to Ask:
-Would you stop at a drawdown level that would be a great entry point if you were not already trading it?
When we combine these two strategies into a portfolio we can see the latest hypothetical results below for an end of day equity and drawdown curve.
These are the results through 4/28/2026 (half day).
NQ Two System Portfolio
Hypothetical Performance Summary
(1/1/2017 - 4/28/2026)
$25 round turn slippage and commission
I study the drawdown curve more than the equity curve when I look at a portfolio. Zooming in on the drawdown curve below, we see the current drawdown $9,665 out of max drawdown of $17,390. We also notice recent drawdown levels in 2024 of $14,500.
It is important to look at the drawdown curve and to not start a trading program without being willing to risk and holding through a new worse case drawdown. Starting on a drawdown like this helps to make the initial risk to worse case drawdown smaller.
Live tracking for this program started on 8/4/2024, near the 8/6/2024 drawdown of the broker assisted program. The current drawdown reminds me of that time period. It was a great entry point as you can see below in the live results what happened in 2024.
Live results for the broker assisted program through 4/27/2026.
Past performance of live or hypothetical results is not indicative of future results.
The NQ Two System Portfolio is program that can be traded through a subscription for self-directed traders.
If you want it managed and traded for you by a brokerage service that can take care of all the technical details, you can contact us to get the Auto Trade service.