Floored, But Back On My Feet! - Commodities Futures Trading | futures io social day trading
futures io futures trading


Floored, But Back On My Feet!
Updated: Views / Replies:29,967 / 118
Created: by tigertrader Attachments:1

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors – all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you don’t need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 1  
 
Thread Tools Search this Thread
 

Floored, But Back On My Feet!

  #91 (permalink)
Elite Member
Budapest, Hungary
 
Futures Experience: Advanced
Platform: Windows 95
Favorite Futures: GC, CL, 6E
 
Yuri57's Avatar
 
Posts: 278 since Feb 2013
Thanks: 71 given, 103 received


tigertrader View Post
@Yuri57

moving target, indeed!

you know what @Fat Tails would say...

"Besser gut shlafen, als gut essen."

"Als fressen" I think I got the point.

But still I think it's possible to trade 1000 lots, just use a mental SL but when a broker gets to know your trading habits is the time to change brokers.

Reply With Quote
The following 2 users say Thank You to Yuri57 for this post:
 
  #92 (permalink)
Elite Member
Chicago Illinois USA
 
Futures Experience: Advanced
Platform: Ninja Trader
Broker/Data: IB
Favorite Futures: duh hammer!
 
wldman's Avatar
 
Posts: 2,069 since Aug 2011
Thanks: 967 given, 2,624 received

I was around for a while..

@Yuri57 and really believe that I have seen just about everything you could imagine in trading and I can name only a very few locals from the Chicago floor trading community that were typically 1000 up on a given market. This, what we do today is quite a bit different than what went on in the hey day of open outcry market making....meaning that it is way way more difficult today to efficiently trade anything even near 100 contracts at a time from a computer screen.

Reply With Quote
The following 2 users say Thank You to wldman for this post:
 
  #93 (permalink)
Elite Member
Chicago Illinois USA
 
Futures Experience: Advanced
Platform: Ninja Trader
Broker/Data: IB
Favorite Futures: duh hammer!
 
wldman's Avatar
 
Posts: 2,069 since Aug 2011
Thanks: 967 given, 2,624 received

Everyone...even experienced successful guys...



tigertrader View Post
@Yuri57

as bacon would say (robert, not kevin), the grind is taken. as a short-term trader, you get "satisfaction" on a more predictable basis, but you pay a price (risk premium) for the comfort of a higher frequency of gains; that is smaller profits, and higher friction. this kind of trading, was "pit appropriate" because of the advantages afforded the floor trader, i.e., reduced commissions(with a yearly cap), a real edge ( buy/sell-it-on-the-bid/offer), knowledge of the order flow, auditory and visual cues, etc. it was a very un-level playing field that was tilted in favor of the local and was tailored to scalping - high frequency, low expectation. because of these advantages local traders owned the grind.

change venues to the screen, and all the advantages that a pit trader enjoyed on the floor are gone. he immediately becomes an uninformed trader, who gives up the edge, pays higher transaction costs, has to deal with execution slippage, and loses all the visual and auditory feedback he enjoyed in the pit. he goes form making the market, to reacting to the market. in effect, the hfts, have supplanted the local trader/market maker, and inextricably tilted the playing field to their advantage. now they own the grind.

this is question of of market structure, but lets consider price distribution. the majority of trading days are range or mean-reversion days. if we use es as a proxy, only 14% of trading days are trend days. there are big implications here in both psychology and p&l. trends tend to be outliers- low probability trades - frequency is low, expectation is high. the trader now goes from paying a premium, to receiving one. therefore, the big money is in the outliers, because of the way profit opportunities are naturally distributed by the market — not evenly, but in concentrated bursts for limited periods of time.

of course, the best approach would be to integrate your trading styles, using a mean-reversion strategy on range bound markets( while avoiding the chop), and a trend following strategy on trend days. but even in this scenario, probably 80-90% of your profits, will come from 10-20% of your trades, and those are the fat tail trend days.

for all the reasons i mentioned above, it is infinitely more difficult to trade size electronically than in the pit. you have to realize, that a floor trader that would accommodate a large order, usually received a substantial edge, which could be anywhere from a tic to 4or5 tics below-the-bid or above-the-offer, and in addition he usually had large resting orders to lean on.

this post should be mandatory for anyone that wants to understand and compete in the game today. More wisdom here than in a lifetime of holy grail indies...with all the secret settings...lol

Reply With Quote
The following 4 users say Thank You to wldman for this post:
 
  #94 (permalink)
Live Your Bliss
Canary Islands, Spain
 
Futures Experience: Advanced
Platform: OA
Favorite Futures: What Moves
 
Anagami's Avatar
 
Posts: 701 since Dec 2010
Thanks: 474 given, 1,398 received


wldman View Post
this post should be mandatory for anyone that wants to understand and compete in the game today. More wisdom here than in a lifetime of holy grail indies...with all the secret settings...lol

+1. A terrific post by @tigertrader . But where does that leave an unconverted scalper like myself?

I would have to argue that one can make a good living as a mean reversion trader... BECAUSE of many more opportunities... though lesser gains per trade.

"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas
Reply With Quote
The following 2 users say Thank You to Anagami for this post:
 
  #95 (permalink)
Elite Member
Philly, Pa
 
Futures Experience: Master
Platform: NinjaTrader
Favorite Futures: ES, ZB
 
tigertrader's Avatar
 
Posts: 5,948 since Jul 2010
Thanks: 6,314 given, 31,870 received


Anagami View Post
+1. A terrific post by @tigertrader . But where does that leave an unconverted scalper like myself?

I would have to argue that one can make a good living as a mean reversion trader... BECAUSE of many more opportunities... though lesser gains per trade.

the optimal approach would be integrate both approaches, whether you trade a single instrument , or you take more of a portfolio approach, and trade multiple instruments simultaneously

in either case you, you take advantage of a trend day, by levering up and trading the trend-to-the-end

Reply With Quote
The following 7 users say Thank You to tigertrader for this post:
 
  #96 (permalink)
Elite Member
Chicago Illinois USA
 
Futures Experience: Advanced
Platform: Ninja Trader
Broker/Data: IB
Favorite Futures: duh hammer!
 
wldman's Avatar
 
Posts: 2,069 since Aug 2011
Thanks: 967 given, 2,624 received

Yes...


Anagami View Post
+1. A terrific post by @tigertrader . But where does that leave an unconverted scalper like myself?

I would have to argue that one can make a good living as a mean reversion trader... BECAUSE of many more opportunities... though lesser gains per trade.

I have that issue all the time. I want to be a position trading local like back in the day, but that is nearly impossible. Often I feel like I am just trading or scalping the noise and that is outside of what I identify with as a trader. That said, the best guys could always and continue to do as tigertrader suggests.

The "reversion trade" or non trend, as he describes it, is or could be described as a statistical or quasi-statistical model based entry signaled by anything observable and somewhat repeatable. The case for evidence based technical analysis. In my case the trade entries are nearly the same, at least to a point that I review the potential of a trade to not be worth the identifiable risk of entry. The exits on the other had are totally different....more subjective based on what is given. 3 or 4 es handles is not a very productive trend situation outcome BUT six three or four handle trades, some on each side of the market can add up to tremendous productivity to the guy that can repeat the outcome.

Trend also, can be subjective. But the best earners, true enough, are adding to their positions with the trend right at the prices where the majority are starting to take profits. Good traders press the hell out of their winners.


Last edited by wldman; January 20th, 2014 at 09:38 PM.
Reply With Quote
The following 7 users say Thank You to wldman for this post:
 
  #97 (permalink)
Banned: trolling
NYC + NY / USA
 
Futures Experience: Advanced
Platform: "I trade, therefore, I AM!"; Theme Song: "Atomic Dog!"
Favorite Futures: EMD, 6J, ZB
 
kronie's Avatar
 
Posts: 798 since Oct 2009
Thanks: 216 given, 498 received


tigertrader View Post
@Yuri57

as bacon would say (robert, not kevin), the grind is taken. as a short-term trader, you get "satisfaction" on a more predictable basis, but you pay a price (risk premium) for the comfort of a higher frequency of gains; that is smaller profits, and higher friction. this kind of trading, was "pit appropriate" because of the advantages afforded the floor trader, i.e., reduced commissions(with a yearly cap), a real edge ( buy/sell-it-on-the-bid/offer), knowledge of the order flow, auditory and visual cues, etc. it was a very un-level playing field that was tilted in favor of the local and was tailored to scalping - high frequency, low expectation. because of these advantages local traders owned the grind.

change venues to the screen, and all the advantages that a pit trader enjoyed on the floor are gone. he immediately becomes an uninformed trader, who gives up the edge, pays higher transaction costs, has to deal with execution slippage, and loses all the visual and auditory feedback he enjoyed in the pit. he goes form making the market, to reacting to the market. in effect, the hfts, have supplanted the local trader/market maker, and inextricably tilted the playing field to their advantage. now they own the grind.

this is question of of market structure, but lets consider price distribution. the majority of trading days are range or mean-reversion days. if we use es as a proxy, only 14% of trading days are trend days. there are big implications here in both psychology and p&l. trends tend to be outliers- low probability trades - frequency is low, expectation is high. the trader now goes from paying a premium, to receiving one. therefore, the big money is in the outliers, because of the way profit opportunities are naturally distributed by the market — not evenly, but in concentrated bursts for limited periods of time.

of course, the best approach would be to integrate your trading styles, using a mean-reversion strategy on range bound markets( while avoiding the chop), and a trend following strategy on trend days. but even in this scenario, probably 80-90% of your profits, will come from 10-20% of your trades, and those are the fat tail trend days.

for all the reasons i mentioned above, it is infinitely more difficult to trade size electronically than in the pit. you have to realize, that a floor trader that would accommodate a large order, usually received a substantial edge, which could be anywhere from a tic to 4or5 tics below-the-bid or above-the-offer, and in addition he usually had large resting orders to lean on.


I can't agree more, and I appreciate your word phrases, because so many of us retail traders, after going a few rounds, either as trading groups gathered around some room, concept or shared approach, have drawn similar conclusions, just not as well worded, thorough or fully aware of all those parallel details.

Successful floor traders, amongst all those that were there, and those that had large accounts, were able to rest against orders and in essence take virtually risk-less trades over and over. As things go, those that were able to do that earliest in the life cycle of the contract traded became powerhouses in the pit.

Electronic success by essence comes from take many small profits, and over time, those themselves adding up to ones targets, goals or needs. Home-run trades happen, but are not the norm, even for position traders willing to stay through overnight margin calls or stay multi-day trades. One has to constantly fight against the natural human emotion of only seeking, preferring or looking for home-run trades, and get back to the grind and grind out a living with less than stellar trades, hopefully of a profitable nature and holding the line on losing trades.

Reply With Quote
The following 4 users say Thank You to kronie for this post:
 
  #98 (permalink)
Live Your Bliss
Canary Islands, Spain
 
Futures Experience: Advanced
Platform: OA
Favorite Futures: What Moves
 
Anagami's Avatar
 
Posts: 701 since Dec 2010
Thanks: 474 given, 1,398 received


tigertrader View Post
the optimal approach would be integrate both approaches, whether you trade a single instrument , or you take more of a portfolio approach, and trade multiple instruments simultaneously

in either case you, you take advantage of a trend day, by levering up and trading the trend-to-the-end

Over the years I found that the optimal approach is the one that fits with my personality (i.e. one that I can stomach). I know this is a trading cliche repeated over and over.... but it's true. For me, that means scalping and frequent winning.

As a trader, I have to feel happy and content with the way I work. Otherwise, I won't be able to execute properly or withstand drawdowns.

"...the degree to which you think you know, assume you know, or in any way need to know what is going to happen next, is equal to the degree to which you will fail as a trader." - Mark Douglas
Reply With Quote
The following 4 users say Thank You to Anagami for this post:
 
  #99 (permalink)
Trading Apprentice
Chicago IL
 
Futures Experience: Intermediate
Platform: Think or Swim
Favorite Futures: Currency Futures
 
Posts: 1 since Apr 2014
Thanks: 1 given, 1 received

Great Post!

Thanks.
I was down there with you most of the time. from 1979, on. The real computer revolution started
with the introduction of options.

It's been a ride for me, too. I started running to the Gold pit... back at 444 W Jackson.
Soon after that I was on both exchanges. When I go down there I feel like
I am seeing the old South Works.

But not all of us were "floored"!

I am starting over, too!

Reply With Quote
The following user says Thank You to ckemnitz for this post:
 
  #100 (permalink)
Elite Member
Philly, Pa
 
Futures Experience: Master
Platform: NinjaTrader
Favorite Futures: ES, ZB
 
tigertrader's Avatar
 
Posts: 5,948 since Jul 2010
Thanks: 6,314 given, 31,870 received



ckemnitz View Post
Thanks.
I was down there with you most of the time. from 1979, on. The real computer revolution started
with the introduction of options.

It's been a ride for me, too. I started running to the Gold pit... back at 444 W Jackson.
Soon after that I was on both exchanges. When I go down there I feel like
I am seeing the old South Works.

But not all of us were "floored"!

I am starting over, too!

damn, you must be a real alter cocker?

Reply With Quote

Reply



futures io > > > > Floored, But Back On My Feet!

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Linda Bradford Raschke: Reading The Tape

Elite only

Adam Grimes: TBA

Elite only

NinjaTrader: TBA

January

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
"Floored," the documentary on Trading Pit opens in Chicago this week goldilocks Off-Topic 39 September 11th, 2013 12:55 PM
FLOORED - CME FLOOR MOVIE traderTX Traders Hideout 2 August 16th, 2011 11:33 PM
Back to the Future! Back testing multi time frame strategy trades occuring in future mrticks The Elite Circle 10 April 2nd, 2011 10:54 AM
1/2 way back Xzap Traders Hideout 2 August 10th, 2009 09:08 AM


All times are GMT -4. The time now is 06:28 AM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-12 in 0.17 seconds with 20 queries on phoenix via your IP 54.145.51.250