Profitability in the Forex Market with the USD/CHF Currency Pair using Grid Trading Strategy.

Abstract

The aim of this study was to develop a profitable strategy in the foreign exchange market using the USD/Swiss franc currency pair. Two strategies, namely the Traditional Grid and the Dynamic Grid, were created and backtested. The study analyzed the USD exchange rate data from January 2019 to May 2023, The optimum criteria for each strategy were determined based on the performance of the USD/Swiss franc pair.

The results of the study showed that both strategies yielded profitable outcomes. Strategy 1, the Traditional Grid, achieved a profit of 23.51%, with a maximum drawdown of 17.04% and a coefficient of variation (CV) of 0.7247. On the other hand, Strategy 2, the Dynamic Grid, achieved a profit of 81.16%, with a maximum drawdown of 17.75% and a CV of 0.2187.

Based on the experimental results, the study concluded that the most suitable strategy is Strategy 2, the Dynamic Grid. This strategy demonstrated higher returns compared to the Traditional Grid and had a lower CV, making it the most profitable option during the analyzed period.