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Would 5 months translate to a 3 year equivalent? What about 4 months? 3 months? How about 2 weeks? What about 1 day?
If someone called you up and said...hey, I've got a guy who can invest your money and earn 20% a day! What sort of track record or history would you need to believe he/she could do that going forward for say a year?
"A dumb man never learns. A smart man learns from his own failure and success. But a wise man learns from the failure and success of others."
Can you help answer these questions from other members on NexusFi?
Well, do YOU have the answer ? Is there an objective answer to this question ? Textbooks in statistics may give some answers but if we're talking about manual/discretionary trading, it's questionable whether employing elaborate statistic analysis is helpful in this context at all.
I gave you my answer. There's no "threshold" but only a trend.
The larger the timeframe referenced for performance, the greater correlation and confidence you can have employing that same method/system in the future.
The number of traders who can repeat performance over several years vs several months is quite different.
Even with a "discretionary" style....6 months of performance is not enough to prove conclusively that you've been successful under all the varying conditions the market has to bear.
Like I said, there's no magic number or timeline, just that greater timeframe indicates greater probability of being repeatable and consistent.
"A dumb man never learns. A smart man learns from his own failure and success. But a wise man learns from the failure and success of others."
if its 2 points or 10 points - its relevent to the time frame and swing factor that the trading strategy employes - i would suggest working on the various strtegies being presented ( if people would be open to them ) and trying to make them a possibility for everyone, maybe even automate them , lets woek together for the benafit of everyone instead of arguing with everyone for the benafit of one
Of course it's possible, but your aim is off. You should be looking to take what the market offers you in the time frame of interest. That could be more or less than 2 points, depending on a variety of factors. You need to start by asking the right questions; specifically 'how' not 'if'.
Old thread, but I spoke to a guy who's been trading full-time for 7 years and his only goal for the day is to make 1 point. After that, he's done. He trades 20-30 contracts. That's 30K $ per month gross. I think he said he had 2 or 3 losing days last year.
I've been following the ES on/off for the last 10 years. Some of it trading it/following it full-time.
I've tried building a model which captures a bigger piece of the daily swings than just 1,0 point, but in actual trading it so far - I have mixed results. That is - roughly breakeven. And this is day trading the afternoon session only as I have a full time job still. I often find that I may even be correct in predicting price movement, but that the micro aspect, i.e., smaller swings stops me out before resuming my initial direction.
So, I'm still testing things and smoothing things out while keeping risk/contracts to a minimum.
To get back to your question:
80 % of my trades for the last two months have a maximum favourable excursion of 1,5 points or more.
86 % of my trades for the last two months have a maximum favourable excursion of 1,0 points or more.
Sadly, quite a few of these have instead turned into losses or BE/+0,25 point profit trades. My entries tend to be good, but I need to get better at my exits. Either decide to hold my trades (AND INITIAL STOP) for the desired target allowing adverse movement or start banking smaller profits (or just 1,0 point and call it a day) instead.
Based on this and inspiration from that other trader I have indeed considered if I should instead be content with less for the time being.
