This is what I have been doing last 3 years. I have been into making strategies thru Genetic evo continuously on 200 computor threads. I have also traded and are trading 1000nds of them mostly on demo accounts but some real accounts as well and i guess i been lucky since they have been making money on my real accounts. I learned a bunch of things doing this for example.
1. Most strategies actually works if the market it is trading comply with it. Curve fitting is a myth.
2. All strategies will have stagnation and drawdown. This is the most common state.
3. You cant make a strategy profitable on a period when it has been loosing by optimizing it . You can make it flat.
4. Saving good performing strategies after a 6-24 months period with very good performance has no impact on future performance looking at a short perspective of 6 months or less since stagnation and drawdown is the most common state.
Now i decided to try and trade only the current performing strategies based on a rolling look back x trades performance which i have automated. This seems to work fine and increases winrate of the 1000 plus strategies from 49 % to 60 % which seems to be a game changer because this way i can now bulk trade strategies and be tuf and only trade the ones that actually currently have an edge on the current market that they are trading.
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I've been trading for over 10 years, some years profitable some years not so much. I've literally tested almost every indicator known to man, and have been frustrated enough to call it quits several times, but sooner or later the market pulls me back in.
I have no reason to lie to you or offer false bravado, I'm selling nothing. About 2 years ago I discovered an algorithm using pure price action. I have a proprietary way to set up the time bars, so they are unique to my chart. To provide some frame work- if technical analysis works- but everyone is trading the same charts there will be no edge. ES Futures trade from 6:00 pm till 5:00 the next day, so that's a daily chart. But a daily chart can also be from 12:00 noon to 11:59:59 am the following day- it's still a daily chart but no one is looking at it for typical patterns. (Not what I do- it's just a for instance) My system is a swing system, which is SAR (Stop and Reverse). I trade a basket of 8 commodities, and have been either long or short in the market, on all 8 contracts, since funding my account from a property sale on February 3rd 2020. My account is currently up 77.79% as of 5:00 est today. I'm actually in a draw down as my account was been over 100% twice in the past 2 months. I wish returns could be steady and offer a consistent 1k per week but that is just not how the markets tend to turn. Most systems will have a dormant period, where the system is spinning it's wheels or losing money- but the key is when the market starts clicking again- will the system make up for the small losses accumulated along the way.
I'm not a programmer- so my back testing is done manually on Excell, which is extremely time consuming- but back testing revealed my system has had over a 100% return for the last 3 years. (107%, 127% and 162%). After hitting 50% profits by the end of March- I assumed the system would be over 200% for this year- which remains to be seen.
Profitable systems are like nuggets of gold- they are hard to find- and it takes a tremendous amount of expended energy to find one. I'm very protective of my system- I've read tons of information, and it seems that most profitable systems exploit discrepancies in the market which are eventually recognized and filled, whereas the system will begin to fail- again this remains to be seen.
I've researched prop firms and incubators, and I feel they are all methods of hi jacking some one else's hard work. My goal is to continue to build the account- at which point I can start drawing off money to live.
I actually have tears in my eyes when I see the return, and what this could mean for my future, but I remain cautiously optimistic. I hope if (or when) the system fails I'm able to recognize it and re-act accordingly. Even though the return, to the casual observer, is impressive- bad days are still bad days, and you never know if that bad day is the first of many and will lead to a breakdown of the system, it's not easy.
No matter what confidence in my system I think I have, and with all the testing in the world, on a daily basis there is concern. Real money is on the line- and you do the exact same things to lose money (when the system doesn't work) as you did to make money, which is like no other job you've had. The peace of mind I do have is that Jim Simons from RenTech, assumed his system would eventually blow up- and that was on his way to 20 billion dollars! If I could only be so lucky.....................................
Good luck and keep the faith.
As an aside: At this point I have no clue as to what my system would be worth going forward, scalability is an issue with an account, say, over 10 million? So in that regard I wouldn't 'sell' my system to anyone for any amount at this point, if it's true money maker, with all the ups, downs and blemishes, how would you value it? So the entire point of my post (like the Market Wizards books) is just to add positivity to the mix- this journey can be extremely frustrating, been there, but the rewards are possible for those with conviction (and maybe a little luck). From "The Edge": What one man can do another can do!
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I wanted to weigh in here a little bit since I have had a lot of exposure to failure as a trader on my own and through my own prop traders and the many online traders I have come to know.
Here's the bottom line: Take any method or approach (fibs, trend strategies, auction markets, indicators, price action, order flow, etc.) and you can be a tremendous success or a complete failure depending on a ton of constantly moving variables. You can feel like an ace with your 14/50 EMA cross-over system for a period and then watch your account dissolve to nothing. In other words, everything works and nothing works a lot of the time. There is a heavy element of luck and randomness in addition to market regimes that may favor one way over another.
With that being said, the thing that must be consistently stable is the trader. I think @Meklon and others offer solid advice. For consistent resilience and adaptation, in my opinion, you must understand why the market rotates and its purpose at its core. So understand that it is an auction and understand how auctions work. Then use one of many, many ways discussed here at FIO as to how to identify a balance (choppy/sideways) market vs imbalanced (trending/breakout/momentum) market. Then create a plan that SUITS YOU AS AN INDIVIDUAL which first sets a reasonable amount of cost for testing a trade (this is your stop) to find out if your timing, direction, entry price and stop size are aligned with the market. At its core, this is what trading is. Period. Don't complicate it more than this.
I know I'm not offering you specific steps, but I would really urge you to come with the attitude that you are just a sail in the wind. Your goal is to simply position yourself in a direction where the wind (which you can't create or control) will take you. So identify the trend in YOUR time frame and ride it for reasonable outcomes.
I can get more specific, but then again I have done what seems like 100s of webinars on many aspects of what I'm covering here.
Be patient. Be vigilant with risk. Allow yourself time and mistakes. This will take a while and will cost a lot to figure out.
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There are many profitable consistent traders of stocks and futures. You just need to know where to find them. They are young, they work, and they are focused. You can find a few of them on Twitch. Yesterday, Matt, a funded $150k trader at Topstep was down $2900, took a break, and made $7,000 to finish up the day with profits over $4,000.
jtradezdays is another consistent trader. You see his trading live, you see his face and his focus.
I can lead you to many more but that should do for a start.
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And, I just saw the post by FT71. He has some good things to say so read that closely. I remember many years ago he and I were banished together from a trade room that we were in. We moved over to another room with just us 2 in it. I was glad to see he moved on up to where he is now.
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I just came across Matt and his YT channel yesterday evening. Do you know if any profitable traders who use Bookmap other than FT71 and have a room or live stream? Thank you for posting this information.
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All of the metrics you mentioned are useful, but for us it is simply end of year P/L. Our 1099-B's tells us if we are profitable. I know this seems like an oversimplification, but in my mind profitability is binary: you either are or you are not.
With respect to your comment on mechanical systems (we are algorithmic traders for 12+ years), I don't know if your numbers are accurate but I would love to find out. Unfortunately brokers cannot tell who is trading algorithmically versus discretionary, though many (all?) publish the percentages of retail and institutional traders who make money. I can tell you that as soon as we algo traders stick our fingers in the pie, we are discretionary, such as when we have to correct a bad entry. I know every algo trader has had to intervene manually at some point. I have known of some traders who have blown up accounts with their automated systems. Hopefully someone is able to commission and perform a study that can provide us with how many algo traders are profitable. Maybe when my pockets are deeper I will do that .
Okay, I went off rail there. Anyhow, I think the metrics you mention have a ton of value, but some are more important than others, depending upon what you trade (softs, metals, indexes, equities, options, wine*, etc.), how you trade (style), when you trade (timeframe), and why you trade (goals and expected outcomes). Profitability eventually comes down to: did I make money?
Anyhow, great comment, thanks for sharing!
~vmodus
* I have traded wine futures once upon a time, for real
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I kinda of disagree with you. It depends on the timeframe chart a trader is using. If I trader is using a 4 tick range chart, everyday the trader will get a trend to trade maybe once or twice a day. If a trader is using a 1 minute timeframe chart, the trader will get a trade once or twice a day. If a trader is using the 60 minute chart or 4 hour chart, then yes, i agree with you, there will not be a trend daily and trader has to wait for those setups.
There is nothing wrong with a trading trainer teaching trend strategies as long as the trainer informs the students, that a trend may not occur daily and it really dependent on time frame of chart.
There is nothing wrong with indicators if the indicators prove to make money over time, it helps the mental. Now I kinda of disagree with 10 indicators on the chart cause too much confusion.
IMO, it all depends on the style of trader and what he or she likes.
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- Trade what you see. Invest in what you believe -
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- Trade what you see. Invest in what you believe -
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Dude...you are THAT Bubba...holy crap. That was like 15 years ago. Remember how much I used to call those other people out with their trades. Turns out they both got arrested for fraud or something. Every time I posted a live trade (and I did a lot of them back then as a scalper), they would make comments. Anyway, glad to see you here. 15 freaking years...wow I'm getting old.
Risk Disclaimer: Trading Futures is not suitable for all investors. Past Performance is not indicative of future results.
If you have any questions about the products or services provided, please send me a Private Message or use the futures.io "Ask Me Anything" thread
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I use Bookmap purely as a tool to monitor volume and what type of traders are part of the volume.
I use a highly controversial method using the sell pop-up window in NT8. I do this with 10-30 contracts for 2-3 tick trades. This is my $1000 a day keeps the bill collectors away method.
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I trade intraday day-to-day, small time frame chart, and look for a 1 or 2 trends of the day.
I do a good job of getting the trend right at the moment, however, sometimes, I miss trades with the direction of trend because I started using limit orders to make sure my risk (stop loss distance from predefined entry) is equal to my reward (profit target based on price action locations). It is a bit of scalping sometimes.
I use limit orders, and some times I miss trades. However, if I use stop orders to enter, I want miss any trades, but my RR will be less than 1.
Question:
1. Is this normal as a trader to focus on the risk vs reward per trade and setup trade such that each trade risk is somewhat equal to reward?
Just wanted your opinion to make sure I am not overworking myself on these trade setups.
I can show you a trade example, so you see what I mean.
Morad Askar, better known as FuturesTrader71 or simply FT71, will be monitoring this thread so that he may answer any questions that you post here about trading in general.
Please keep in mind that some customer service/technical support issues are …
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- Trade what you see. Invest in what you believe -
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I went looking for Matt on Twitch, but he has moved to YouTube.
"Trades by Matt" is the name.
Persistence! Nothing in the world can take the place of persistence.
Talent will not ... nothing is more common than unsuccessful men with talent.
Genius will not ... Unrewarded genius is almost a proverb.
Education will not ... The world is full of educated derelicts.
Persistence and determination alone are omnipotent! Calvin Coolidge
It was stated that Trades by Matt had moved to youtube and yes he posts to there a day or so later. However, REAL TIME, he comes on at 8:25 central on Twitch.com. He was not in there today as he put in a full day of trading on Monday.
I trade like him on the opening and the first few hours of the day. I focus and get my trading done during prime time.
He has a lot of followers and I doubt he is leaving Twitch.
Actually looks like, as of today, TradesByMatt has moved to YouTube:
[yt]https://www.youtube.com/channel/UCAiadqtIuxMOBbzMHGk_aYQ/join[/yt]
See: TradesbyMatt
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My God. A trader who streams live AND shows losses. Heavens no. This cannot be right...
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- Trade what you see. Invest in what you believe -
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Matt does not moderate when he is in a trade as he is focused. You will see the trades show up and the P/L will show up his progress up and or down. He usually is around for the first few hours. He does not broadcast all day long.
I partially agree with you. Those metrics are not the best because they don't show the total risk. Risk (even partial risk) is hard to show because most (all?) systems won't track it. But annual tax statements are not enough because we are also trying to determine the statistical chance of long term profitability not just historical profitability. A trader can be very profitable for a few years and then blow up spectacularly because he never managed risk well. His historical risk adjusted returns will be poor.
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Thank you Bubba1 for sharing with me someone who actually trades live real cash. I have always wondered is there any trader out there willing to show others what they are doing. To me it only makes sense to trade live and show your customers or viewers your trading if you selling them something.
If someone shows you 5 years of annual trading tax statements from 2015 to 2020, AND all of their trades during this period, AND provide you the performance metrics of all these trades, is this not enough to convince you with a high probability chance of not wasting time , energy , stress, and money to invest in this person to teach you how to trade?
What else would you want someone to show you? The performance metrics will show edge and drawdown.
If they provided all of their trades during the period then for sure you'd have all the information you'd need to make a decision, including how much risk they're taking on.
But I have never seen it. Not 5 years worth, and certainly not anyone trying to sell something.
This is really just about teaching people how to evaluate a strategy, because there's a lot of dirty tricks the charlatans are using out there that are very effective at convincing people. The biggest one I see is making money by taking on excessive risk. Strategies that fit this category would include strategies where your target is much closer than your stop (if there's a stop at all), doubling down on losers, or martingale strategies where you risk more and more even when you're losing. Such strategies can result in really high winrates, but risk catastrophic losses. I find this particularly common among combine traders. They'll get funded using excessive risk, and then blow the account later. I know some individuals that have been funded over 6 times!
Many probably stumble upon these kinds of strategies to protect their ego. You'll find that the narcissistic ones almost always do this sort of thing. They don't want to be wrong, and so they take on extra risk to avoid having to face the reality. However, it's also just a really easy way to develop a following on YouTube or to sell a service. To new traders it appears like you're winning all the time. You can get away with it for a long time too. Years even. When that bad day comes along it can just be dismissed as a mistake. The reality though is that the blowing up is an inherent property of a strategy that has no real edge.
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Your post said elite trader guy lives in a mansion in Texas, and has a special pattern reading ability.
If you saw the show, you'd get the reference.
Essentially Jeff Lowe was a conman, that also lived in a Texas mansion. There's more, but but the show does much better job of telling the story.
I don't know what living in a mansion in Texas has to do with trading ability. I own a very expensive house in Manhattan, but have lost more money than I care to admit trading futures.
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“Matt Trades” is not exactly selling anything. He is a funded trader by topsteptrader.com and earns on average $650 - $1000 a day. I actually pay YouTube $4.95 a month for the member fee which I think Matt gets 60% or more of. If he is selling anything it is himself. He has to give 20% of his earnings to topsteptrader.
He is very helpful in terms of having someone to trade alongside while you trade.
You would need full disclosure of all their trades along with a complete risk disclosure so you would need to see all their orders
as well because the trades don't show the stops. Specifically you want to focus on their Reward:Risk ratio during adverse market conditions.
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You must be a decent trader if you can afford a Manhattan pad. I moved my family to Japan from California because I thought $10,000 monthly cost of living was out of control. Now we live in the mountains with a custom built home that took us a year to complete and including the mortgage our entire monthly nut is $4,000 down from $10,000 just 5 years ago.
I devote my entire schedule around 3 hours of trading futures and pre-market news stocks. I actually spend 6+ hours a day researching stocks to trade. I usually wait to trade futures until 10am EST.
Your point about losing money trading futures. I remember making an initial $1,500 wire transfer and have never added more money. I pay for my family and I add plenty too my stock balance so my margin is fairly large. I’m not that great of a futures trader but never blew an account yet.....there is still time.
Wife and I have had high disposable income for years, which we used to leverage large loans for investment properties in undervalued neighborhoods over the years. We've since retired from our previous careers to raise our new family, and live off the passive income for expenses.
My minimum monthly expense is about the same as yours was in Cali, about 10k per month.
Taking risks has always been very attractive to me, so daytrading feels very good. Initially I too funded my first futures account with a small deposit. I've lost more money at the craps table than I care to admit as well, so a couple grand in a futures account was play money. However I found success very early on, and that success ended up destroying me over the next year. I ended up putting more money into the account, and was trading 50+ ES contracts. I was completely unprepared for everything that entailed. I guess as a cautionary tale, even if you are having great success over hundreds of trades in a given month, everything can change the next month when the market changes.
Now I'm back to growing the account naturally, like you. It's funny too because while in the depths of my downward spiral, I was constantly reminded of Paul Tudor Jones saying to reduce your trade size when losing. I knew what I was doing was wrong, but I lost all control. I had no business doing what I was doing, and ultimately paid the price of what I think a typical mansion would cost in Dallas TX.
Thankfully my wife has been very understanding of my demons. We all have our neuroses, especially folks living in the city. She truly is my soulmate, and we always lift the other up when one of us falls down.
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Got it. At least Hilmy posts his brokerage statements. They do look real. However, in this day of photoshop and acrobat, one never can really tell for sure.
re: "and was trading 50+ ES contracts. I was completely unprepared for everything that entailed. I guess as a cautionary tale, even if you are having great success over hundreds of trades in a given month, everything can change the next month when the market changes."
Whoa...so with a 10 pt stop, we are talking a $25k potential loss on ONE TRADE ? So if that happens 4 times a week (easily could happen), you could be down $50k-$100k depending on the size of your winners. Right ?
Yes, day-trading and trading in general is an extremely difficult job. So is medical surgery, and aerospace engineering and architecture etc...
Yet, ardent individuals found a way to do it.
I've been checking Matt's Youtube videos and he doesn't seem to have a real strategy? Or maybe I'm missing something?
Perhaps you have been following him for a while and see something I don't...
I just see a guy that keeps adding to looser trades hoping to see a reversal and basically betting to have a gain above his average prices.
No stop loss or real analysis that could explain the reason to enter a trade...
What do you think?
Cheers!
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Picking up pennies in front of a steam roller always ends the same.
By the way, thanks for linking to that elite trader thread. I never really browsed that forum the way I do this one. But having read through most of that thread, and a few others, I can relate to alot of the insane behavior from those guys. This forum is very PG compared to that place.
Thank you! This is an excellent way to articulate it.
How do you know if you are taking on excessive risk? Are there a set of metrics you look at?
Is it just having more than 1:1 risk reward and a high Sharpe ratio? Does it need to be compared to some metrics of other consistently profitable traders?
You sound like you been trading for awhile. LOL. I will be honest and I was one of those traders scalping with big risk, small reward. My risk was about $300 per trade and my reward was between the $40 to $150 range for that $300 risk. And yes, my win rate was high, around 92%. But guess what, one or two losses would take away about 4 days of work. fast paced way to trade, but I had to trade alot to get that win rate up.
Now I plan my trades setups for minimum R:R of 1 and learn to wait for a cheaper entry.
I am currently in TopStepTrader, I was recently funded after 3 months of trying. Went up about $1600 in 3 days, then hit drawdown and a few mistakes and failed out. Now I take some time detail my trading plan and trade setups.
I can tell you this. It takes time. Markets conditions will change. Trade Management regardless of market conditions is important. It is important to KEEP going and trade everyday straight for 2 years. The eyes must see different situations. Correct practice is the best practice.
I am not consistent profitability, but what i think helps me is getting good training, journaling trades, studying, and taking trades and just getting experience
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While I've been in the finance world since the 2008 crisis, I've only been actively day trading for 4 years. The advantage that I try to have is through community. I troll the forums a lot, run my daily Speculatorseth livestream, and chat on discord. So I come into contact with awide variety of retail traders and information.
That's why this particular issue just grates on me so much. I've watched a lot of people lose money with these kinds of strategies, and I find it really difficult to convince newer traders of the danger in them.
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Hey Bubba1 thanks for the mention. That's actually my Instagram name. Twitch name is just "jtradeZ". Live trades everyday with Live P&L. It's Free and all are welcome.
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I agree with you. This is why I try really hard to setup up my trades, with minimum R:R equal or greater than 1 and I wait for targets. Sometimes price and market conditions does not care about my profit target and, I have to re-think a new profit target, making the R:R less than 1. This is rare.
If the market setup will not allow for your minimum R:R, then you should just pass on the trade and wait for a trade that does work. Better to wait for what will inevitably occur than push a bad setup!
Persistence! Nothing in the world can take the place of persistence.
Talent will not ... nothing is more common than unsuccessful men with talent.
Genius will not ... Unrewarded genius is almost a proverb.
Education will not ... The world is full of educated derelicts.
Persistence and determination alone are omnipotent! Calvin Coolidge
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I can only give you some general advice. I was a local futures floor trader for 30 years on the CBOT, the LIFFE Exchange and traded also on the Sidney Futures Exchange and the floor of the Brazilian BM&F. Screen trading is much harder because everybody is on the same playing field. Still here's my takeaway..
1) You'll have to lose money to learn how not to lose it. I lost money for 3 straight months, when I started, until suddenly I gained a "perspective" of the market that I was trading; it's like the penny drops and suddenly you have more awareness. Whatever you choose to trade, trade it every day, and don't miss days like it's a part time job. You'll lose continuity and rhythm. Get to know your chosen market like the back of your hand. After a while trading it should become almost a mechanical process. I'm a scalper, so this advice is more applicable to my type of trading.
2) Be determined as hell....that the market is not going to beat you...that no market will!
3 Trade small until whatever you're doing starts to work for you. Being consistent every day is your goal; Losing big at the outset will dishearten you, and the market will spit you out in a bloody heap. I know traders who even committed suicide over this. If it's a rough, choppy day, you're still down a few hundred by early afternoon - then quit. Trying to break even for the sake of it will end in tears. Call it a successful day. Tomorrow is another day.
4) If your account is ahead, then at the end of the month take out half of your profits. Pay rent and some bills. Connect your futures acct to the real world and get satisfaction that your trading is working for you. Build your acct by half of your monthly profits.
5)A word about automated systems (based on rules and indicators). Engineers and methodical people love them and hopefully they free you up to do your regular job, or if you can't stay in front of a screen. I've paid thousands for so-called proven systems, back-tested up the wazoo, traded by a professional broker on my behalf, that were written and devised by rocket scientists. They work great, until they don't. The market will always defeat them at some point. Simple as that. Trying to write your own rules based system will be a waste of time. The ability to create your own system is kind of cool, but it just sells hope for the most part. (sorry if I sound cynical).
6) On a personal note, I won't trade stock indexes. The algos and bots make it like swimming in shark infested waters. Absolutely everybody is trying to pick each others pockets is ES or whatever. I stick to traditional commodities like gold or financial instruments.
From your post, I sense perhaps some early frustration with trading the markets. I sincerely wish you the best of luck going forward.
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#4 - I have a similar perspective, in general, when it comes to trading. Traders need to be consistent to be able to do this ('consistency' seems to be a theme in this thread). I think that, beside understanding that you need to enjoy the fruits of your labor. I think it actually can lend itself to keeping your trading grounded.
#4 (part 2) - I won't pay money for algos/automated systems, or even trade ones that have been given to me, for some of the reasons you mentioned. Mainly, backtesting is done wrong (refer to the writings of Kevin Davey, aka @kevinkdog). With that being said, I am an algo trader and yes, systems can fail after a certain amount of time, at which time it is okay to retire them. The most valuable thing I learned from Kevin regarding algo trading is portfolio diversification, especially building a non-correlated portfolio. That is kind of where we (my wife/trading partner) are with our trading.
I think people have a certain idea of what bot/algo/auto trading is, but the reality (having been doing it for many years) is something completely different. It is not the ATM that some people think (or promote) it is.
~vmodus
~vmodus
Enjoy everything!
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I don't think I can post the link because im New. It's in my profile or you can go to twitch. TV and search "jtradeZ" I'll be on today around 9am eastern standard if you want to come hang out.
Hello Goodoboy,
I'll never intentionally enter a trade where risk is greater than reward. If a range is narrow I won't trade it. If a range is wide, I can pick tops and bottoms with better risk/reward ratio. I don't hold trades for the whole width of a range; I will get out halfway through the range because I don't have much patience for holding onto trades. I use limit orders to pick my entry spots. If a market is breaking out of a range and I sense momentum building for a strong move in a direction, then I'll jump in at market to make sure I get in. Trying to finesse a fill on a breakout move will make you miss the move. When instinct really tells you a breakout move is happening, I'll add another contract. I avoid slow markets or lunch time markets as scalping trades must then be held for longer times and I like to be in and out pretty fast.
One more thing. Personally, I don't use any indicators. For my type of trading they just make me second guess what I want to do .( Eg I want to sell, but price is above an MA so I don't pull the trigger.) I use point and figure charts - one chart for every single tick movement and one long term chart - 10 ticks for each box. Most people will use a one minute or five minute candlestick chart.
Good luck with your trading!
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Rant alert, not directed at syswizard, just directed at this thread. If it kills the conversation, sorry, but so be it, the horse has been dead for weeks but it keeps getting beaten.
First -- I don't get this whole conversation. It's like a bunch of nerds who've never gotten laid, trying to get proof that one of them finally scored. "you mean... it actually can happen?" And then what? You'll believe...? If you tie your belief to someone else's brokerage statement, you definitely do not have a winning attitude. That's a pure loser's mentality. You surely will also want to copy what that person does, hoping that his way can be your way too. As long as you think that way and hitch your possibilities in life to what someone else has done, you will stifle your creativity and your potential. Think for yourself.
Stop doubting people, as if consistently turning a big profit in trading is some kind of utopian impossibility. My god, don't you know there were once floor traders who regularly traded many hundreds of contracts? In "Trading in the Zone," Douglas talks about a client who traded t bond futures who would trade a thousand, for a $30k +/- swing per tick.
On the other end of the spectrum, stop idolizing people who make money. They're not better than you, they're not some demigods who have some magic formula. They have simply aligned their minds with the market, see it for what it is, and above all else, they don't treat it like some unreachable dream like some of you do. You know the girl, the really hot one, the one who you think is way out of your league? You'll never get her, but not because she's out of your league; because you think she's out of your league and you act like an idiot every time you come within a mile of her. You can approach trading like it's your obsession, because that's not a healthy relationship, and it will do what people who you view that way do to you -- rip out your heart. Except the market will also bend you over and create a second orifice for you. So, stop idolizing this business and stumbling all over yourself. Get it together, respect the market, and allow it to pay you.
Second -- think bigger. I'm not a big baller AT ALL, but if a $25k loss on a trade scares you, why are you in this game? To make $100K a year? With a good head on your shoulders, you can break into the technology industry (as there's such high demand), and be making that in 2-3 years, and much more than that if you're actually good. And that's with ZERO risk on a daily basis. Traders are paid because they take calculated risks. If you're scared about a $25K loss, you're probably scared about a $25 loss, just to a lesser degree.
The following 12 users say Thank You to josh for this post:
I disagree with you on this. Allow me a single quote which applies in this situation
Trading can take years of losing before one finally manages to turn a profit. Hope is what keeps a person striving through the anguish and is the source of your greatest strength when you are in a world of hurt and all you want to do is give up.
I think it is totally normal and acceptable to look to those that are successful to try to emulate certain successful characteristics. Seeing success in other gives hope which is the foundation of belief. If you are not yet profitable and are not seeing success in other people then what motivates you to pursue trading?
The following 5 users say Thank You to Grantx for this post:
Great explanation. I have been doing the same thing in those ranges, seeking RR=1 for buying bottom and selling top. One thing I am working on is not getting scared to sell top of a range with bullish context.
I agree with you, for those strong breakouts, I just enter with market order. Better to be in then out.
The following user says Thank You to goodoboy for this post:
1) Don't believe anyone's P&L report without seeing audited documentation.
2) It may be useful to learn trading techniques from other traders but make sure to have your own tested trading process.
3) The market is simply a statistical process. Liquid markets can be traded profitably with the right statistical method
else they wouldn't be liquid.
The following 2 users say Thank You to Analytic for this post:
$25k loss implies a $500k min. account balance. Who has that account size ?
Note: That's just standard risk management practice (5% max loss). Some traders go as low as 2% max loss per trade.
The following user says Thank You to syswizard for this post:
Persistence! Nothing in the world can take the place of persistence.
Talent will not ... nothing is more common than unsuccessful men with talent.
Genius will not ... Unrewarded genius is almost a proverb.
Education will not ... The world is full of educated derelicts.
Persistence and determination alone are omnipotent! Calvin Coolidge
The following user says Thank You to Joseph Connors for this post:
Who has that account size? I am assuming that was a rhetorical question that doesn't need an answer because many, MANY traders do. I have a tight circle of trader friends. 2 of them have over 1 million dollar accounts and trade the ES every single day, just like humble me.
And a 5% max loss is standard management practice? Standard by who's measurement? I would never advocate 5% risk of loss on any trading account. 1 to 2% at the maximum. Unless you are a very experienced and consistently profitable trader, risking 5% of your account every day is a means to an end.
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- Trade what you see. Invest in what you believe -
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The following 2 users say Thank You to JonnyBoy for this post:
Hi KyronC, I am not selling anything, but have been profitable with micro futures for some months now. I am happy to DM you with my TD Ameritrade record if you are interested. My mentors taought me without cost and I am happy to do the same where I can.
Thanks,
masterelf1
The following 2 users say Thank You to masterelf1 for this post:
Let's think about it this way. How much money do you want to make in a year? Let's assume it's at least $100,000 -- because if it's anything less than that, why don't you just get a job that makes $100k, without the risk? (can't get a job that makes $100k? look harder) Hopefully it's MUCH higher, but that's a worst case scenario.
Now, let's talk about annual returns. 10% is considered average, 50% would be phenomenal. To make $100k a year, you'd need $1,000,000 and make an average return and you'd need $200k if you're phenomenal. Does $500k still sound crazy? Let me guess -- you have $10k, and you're going to make $100k with that in a year?
Think bigger. If you're trading to make $5k per month to live on, apply yourself and do something easier. This is the type of thinking that vendors lull you into. Also, this whole "1% per trade" is nonsense. Even 1% is too high -- but 1% or 5% doesn't matter. The problem is the retail mindset that says "risk 2%, set your stop, hope it works." That's not trading.
My point, which was clearly lost, is that if losing $25k scares you, then almost certainly losing $25 will scare you as well. The problem is not the amount -- it's the fear. Fear holds you back when you give it a voice. "Omg, I can't imagine losing $25k on one trade" ... well, you'll probably never experience losing that much on a trade, which means you'll never risk enough to make $25k or even close to it on a trade. This reminds of this thread from a few months back.
The following 4 users say Thank You to josh for this post:
I honestly hate this question. If I had a 100 bucks for every time this question was asked in this forum and posts that followed I could afford a really nice house! Seriously, it’s like saying show me your paycheck. Who does that?
When I was growing up I ran across an add for a car which didn’t have a price listed. I asked my dad why and he said if you have to ask then you can’t afford it. I feel the same way about trading; if you have to ask you shouldn’t be trading cause you can’t afford it.
Robert
nosce te ipsum
You make your own opportunities in life.
The following 6 users say Thank You to Silver Dragon for this post:
The problem is people are looking for an absolute answer. They want to know if they do this they won’t fail they will be safe. if you tell them just because I can do it does not mean you will succeed they get pissed. It’s a unanswerable question. No matter how much evidence you can provide they will never be happy! Case and point; we are on post 178 and the conversation is still going on. The question is unanswerable.
Robert
nosce te ipsum
You make your own opportunities in life.
The following 7 users say Thank You to Silver Dragon for this post:
Because quite frankly it is a question (and often from a place of disenchantment) from traders who are failing and don't believe it is possible to earn a living doing it. Re-framing the question to state (and I paraphrase here) "...I am struggling as a trader and I desperately need help..." rather than "Can anyone actually prove to me that they have been consistently growing their account with futures?" would have received more attention.
Who cares about other traders earnings and if they are profitable. Asking this type of question (and just to note I was willing to give direction to the OP out until they proved to be not worth the time) is just an excuse not to trade, an excuse not to be accountable for your own trading, an excuse not to dig deep and find your own answers to a question that can never be answered except by the trader themselves based on a reflection of their own trading.
So it's not a case of being upset by the question, it's a case of the question having immeasurable answers.
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- Trade what you see. Invest in what you believe -
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The following 3 users say Thank You to JonnyBoy for this post:
Friends and people ask me about business ventures and career path all the time, because I am professional in the science and engineering field. I give talks to young people and even my own kids.
Everyone wants some degree of certainty before they proceed a journey.
I be honest with them and I do not sugar coat anything. Atleast I know I gave them my honest answer.
If someone ask me if I make money trading, I will tell them yes or no. It is the Right thing to do.
You realise you just summed up my entire point with that response right?. If you ever achieve the status of a profitable trader, and I mean a truly profitable trader who earns a full time living in the markets, come back to the original question. I am sure your response will be very different from what it is today.
This thread is tiring so I'll exit stage left and watch from the side lines.
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- Trade what you see. Invest in what you believe -
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The following 3 users say Thank You to JonnyBoy for this post:
Inject morality (the "right thing"?) if you want, but it's simply a personal question, which the person being asked has no obligation to answer. Those who say "yes" are then always asked to show proof. If they show proof, they are asked to show live trades. It never ends. It's like asking "do you exist, god?" When the voice from heaven says "yes" then you ask, "can you make it rain, or something?" The real kicker though, is that their 'yes' or 'no' in no way affects you. All of this is an effort to offload responsibility, at its core.
On another thread here recently, people were talking about the viability of a trading method. The average comment was something like this: "I'm not willing to spend $1000 on this without some guarantee that it works." That's all people want -- guarantees. It further proves my $25K / $25 parity comment -- it's not about the money, it's about being unable to accept risk (not the same as the inability to take risk). People want guarantees that their $1000 will not be wasted. What form should that guarantee take? Apparently, anyone who buys this $1000 trading manual should have some guarantee of making money. How ludicrous. Do people who think this way even understand that THIS is one of the reasons they are losing? They want guarantees, because they don't know how to accept risk, and not being able to accept risk is one reason that they lose.
The following 13 users say Thank You to josh for this post:
theirs one simple answer to the question "do you make money" and that is " I haven't had to get a real job yet" This will stop any and all bs about how much do you make, let me see, how much do you lose etc etc. It has been my go to answer for the past few months.
-P
"Truth is not what you want it to be; it is what it is, and you must bend to its power or live a lie"-Miyamoto Musashi
The following 2 users say Thank You to MiniP for this post:
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- Trade what you see. Invest in what you believe -
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The following user says Thank You to JonnyBoy for this post:
Josh, I agree with your sentiment. Some are "fascinated" with the markets, and they like the courses, the indicators, the strobe lights on the platform, the bubbles, and the ongoing chatter about the markets.
Then some approach trading as a decision-making challenge, and they look for solutions that would help them cope with the challenges of the markets. They know the risk, don't look for guarantees; they seek variables that would help them make better decisions.
In my opinion, if the world's best trader decided to write a course, at best, it would help marginally. This applies to any expertise you seek. The best expert advice helps you slightly because the rest is your personal experience and application of things your way. Any information or plan when you don't have practical experience is just a model.
Trading is the analysis of psychology, crowd behavior, price action, and the exercise of risk management. How could one person take all that and apply it to someone else in one curse, book, or lecture? Practically impossible.
Everyone has to ask themselves the question, "what problem am I trying to solve?" This is the model question. You could further ask, "What am I lacking to solve this?" and "what tools do I need to solve this problem?" Then you can evaluate if the tools you are coming across get you close to your goal.
"I want to make money from trading!" is not a problem, BTW. It's a wish. "How do I choose overbought areas?" is a problem, or "how do I stop my impulsive trading?" and "What asset class should I trade?". All these are challenges that could be defined and potentially researched to find the appropriate solutions.
Thank you,
Matt Z
Optimus Futures
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Thanks! It's always been my favorite. I believe it embodies the essential characteristics of gaining success in this game!
Persistence! Nothing in the world can take the place of persistence.
Talent will not ... nothing is more common than unsuccessful men with talent.
Genius will not ... Unrewarded genius is almost a proverb.
Education will not ... The world is full of educated derelicts.
Persistence and determination alone are omnipotent! Calvin Coolidge
All this talk of being "true" to yourself and not following others, brings to mind the story
of the so called "Turtle Traders" from the early 80s. It was supposedly the inspiration for
the movie "Trading Places".
In 1983 commodity traders Richard Dennis and William Eckhardt conducted an experiment
to see if traders were made or born. Dennis believed they were made and could be taught to follow a
specific trading plan with no deviation and Eckhardt believe that they were born with the skills.
Dennis placed and ad in the Wall Street Journal for traders. He received over 1000 replies. He culled
the list down by asking them all a simple question: If you were presented with a trade opportunity
according to the rules of the system but you believed in your heart that it would be a losing trade, would
you execute according to the rules of the system?
VERY few answered that they would execute according to the rules. I believe it was less than 10 of the
original 1000! He hired the ones who said they would execute the system no matter what. Thus were
born the "Turtle Traders" as they became know!
My point is that a disciplined trader can execute any system he is told to execute! Whether or not he believes
in it. Don't get me wrong, believing in a system is VERY important, but I for one can execute a system
that I know makes money even if I don't believe every trade will turn out.
Persistence! Nothing in the world can take the place of persistence.
Talent will not ... nothing is more common than unsuccessful men with talent.
Genius will not ... Unrewarded genius is almost a proverb.
Education will not ... The world is full of educated derelicts.
Persistence and determination alone are omnipotent! Calvin Coolidge
The following 4 users say Thank You to Joseph Connors for this post:
And that is why people are always asking if a mentor is legit, and for proof. @josh we're all looking for a Richard Dennis, with a proven system. Unfortunately that chances of finding a Richard Dennis through Google or YouTube is zero.
The following 2 users say Thank You to planetkill for this post:
1. The turtles had widely different results, because even with the initial selection of traders and the clear system rules and all that, they didn't execute the same trades anyway. I think most people who follow a system don't -- the temptation to just make little adjustments to improve things, or to take into account something else, or whatever, is too great.
2. The Turtle system stopped working when the markets changed and a basic trend-following system stopped working. Dennis stopped trading after some serious reversals, but since he got out in time he kept most of his money. If you had been totally disciplined and not changed a thing in the system, you would have gone broke following it.
Which doesn't seem fair, because you'd lose if you changed it and you'd lose if you didn't, but there it is.
So finding a Richard Dennis won't do it either.
I think the moral of the story is not to look for a trading mentor, guru or system. You do have to do it on your own. What if you had found Dennis right at the point that he started losing money? His track record at that point was beyond awesome, but it wouldn't have guaranteed you a thing.
You can get help and you can learn from others, but that's different. Looking for someone to follow is a very risky way to go.
Yes and I am one of those people. Maybe it is just you and you need to understand that you are not alone. There are those who are earning and those who are not. The difference between them is how they handle themselves in here . You need todo something about it.
Of course there are quite a number of people making money. Think about it, how long has this site been runnning and how many people are using it. If there was no one earning then there would not be anyone here or new people joining. What you need to do is develop a better strategy if you have not been making any profit.
There are people making money and there are people that are not making money. If you are among those peole that are not making money then you are doing something wrong. You are gonna have to work harder and improve on what you have been doing. Strategy is everthing in here.
The following is just a basic guideline based on the current 'accepted' thinking.
A) People Making Money
1) Most Commercial Traders -> Market Makers, Commercial Hedgers
2) 'Large Specs' -> Elite Quant Funds using Machine Learning with correct robust statistical methods for financial time series data
3) 'Small Specs' -> 5% of retail traders (mostly using statistically proven mechanical methods)
B) People Not Making Money
1) 'Small Specs' -> 95% of retail traders
2) 'Large Specs' -> Large amount of dumb money piled into sub-par funds that have bad trading methods
If you are not making money then obviously you need to find a way to move from Group B to Group A
The following user says Thank You to Analytic for this post:
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