Trading large spread and low volume stocks
Can other traders out there share their stories with me about trading stocks that have thin volume and large spreads?
While it's fairly easy to create a strategy that backtests well within that universe, I am very doubtful that actual trading results would be nearly as good, especially as amounts of capital over 100k were deployed.
So I have been focusing on stocks that trade 5 mil shares/day with penny spreads. However, it's been extremely hard to find effective strategies for this universe. All the strategies that have over 60% win rate (with 1% =success) produce no more than 1-3 trades every 4-5 days. Thoughts?
For example, would the strategy below be worth trading?
8 / 13 = 61.54% up 1% in 10 minutes; Average winner = 3.94%, Average loser = -0.1%, Net winnings = 31.01%, Best = 7.86%, Worst = -0.1%; Casino Factor = 98.09%
12/26 : 0.00/0
12/29 : 0.00/0
12/30 : 0.00/0
12/31 : 0.00/0
1/02 : 0.00/0
1/05 : 0.00/0
1/06 : 0.00/0
1/07 : 4.05/1
1/08 : -0.10/1
1/09 : 0.00/0
1/12 : 0.00/0
1/13 : 7.86/1
1/14 : 0.00/0
1/15 : 0.00/0
1/16 : 2.92/1
1/20 : -0.20/2
1/21 : 0.00/0
1/22 : 0.00/0
1/23 : 14.18/4
1/26 : 0.00/0
1/27 : 0.00/0
1/28 : 0.00/0
1/29 : 0.00/0
1/30 : 2.50/1
2/02 : -0.10/1
2/03 : 0.00/0
2/04 : -0.10/1
2/05 : 0.00/0
