What you're saying makes sense. Imo the allure of several hundred pip moves is very deceptive - in hindsight they generally look obvious and therefore easier than they really are to catch. This is where doing stats really helps understand what is the optimal trading strategy you really want to work with, because there are always trade-offs.
This is a bit like the question I often have about many traders' obsession with multi-baggers. It seems that is very alluring to many traders, but obviously multi-baggers don't happen every day, it is often a long time between drinks, or a question of feast or famine (to mix my metaphors). Personally I would much rather enjoy a meal every day than starve for weeks or months before I get that feast (if it actually happens). And especially when you add in the power of compounding into a strategy small regular incremental profits can easily outweigh the multi-bagger approach over time (without risking large chunks of capital on any given trade).
Back to the question of short term wins vs runners, when I analyse a potential model to trade I look at the trade outcomes compared over a range of timeframes. So for example if I am trading a 1 hour setup (i.e. on a 60m setup bar) then I look at the results of that trade if I close it at the close of 1 bar and up to 13 bars. I see a consistent trade-off between the shorter term exits and longer term ones, and I'll use an example set of setup stats for exits of 1, 2 & 13 bars to illustrate (see below):
So just to explain the graphs above (the data is for a 3 year period):
1. The blue line is the equity curve (for this data set its over 4500 trades) and is measured on the left hand scale which is in % return over time, so you can see the returns over the data set are between just under 600% and up to just over 800%
2. The orange bars are the individual trade results in % of equity and are measured on the right hand scale (so in the bottom chart for 13 bar exits there are a couple of big trades returning up to 20% of equity)
Some observations from these charts:
1. Firstly and most importantly, you will see that not a single trade loses more than 1% equity on the right hand scale - because they are always capped with a stoploss at 1%
2. Notice that for the 13 bar exit the orange bars show lots of winners between 5-20% of equity, although the larger they are the fewer they are (only 4 bars there out of 4500 showing a 20% result), whereas for the 1 bar exit there is only a handful of trades that are better than 4% return, and naturally the 2 bar exit is somewhere between (closer to the 1 bar exit than the 13 bar exit)
3. The total returns for the 3 exits are 570% (1 bar), 750% (2 bars) and 870% (13 bars) so the 13 bar exit gives the best total return over the data set
4. However now look at the shape of the equity curves - the 1 bar exit is the smoothest, and the 13 bar exit is the roughest. That is because what is not easy to see in the above charts is that there are many more stoplosses resulting in 1% losses for the 13 bar exit than for the 1 bar exit. Comparing them, 15% of all trades result in a stoploss for the 1 bar exit, 34% for the 2 bar exit and 68% (yes 68%) of all trades for the 13 bar exit result in a 1% stoploss.
5. The result is that the maximum drawdowns for each curve are 6% for the 1 bar exit, 11% for the 2 bar exit and 29% for the 13 bar exit. Also, the maximum time in drawdown (in days) is 7 ( 1 bar exit), 18 (2 bar exit) and 40 (13 bar exit).
Summing up:
In other words, the longer timeframe gives the best return, and the most runners, but it incurs the most pain (number of 1% losses, max drawdown and time in drawdown). So you will get the feel good factor of some nice runners, but it is generally inescapable that there will be many small losses in between. This is a very common result I have seen for different setups that I have tested. It is also applicable on different timeframes (i.e. the trade duration relation applies to a 60m chart pretty much as it does to a 15m chart or a 12h chart) - but of course the pips at risk is different in each case so its all relative - the benefit of the smaller timeframes is more setups in a given time than for larger timeframes, but more work obviously.
Personally for me I started out being attracted to the type of results from the 13 bar exit approach. I soon learned that actually it is much more satisfying and less painful to achieve the smoother equity curve offered by shorter trade durations. I will typically now go for a 2 bar duration as my preferred compromise between gain and pain.
I guess my main point though is I think the relationship illustrated by the 3 curves is generally applicable and therefore a strategy that catches runners typically will also have bigger drawdowns is inescapable, so it necessarily become a trade-off that each trader must choose the best compromise for themselves.
