NexusFi: Find Your Edge


Home Menu

 





Micro account vs Funded account (combine)


Discussion in Traders Hideout

Updated
      Top Posters
    1. looks_one arielalejandro with 20 posts (22 thanks)
    2. looks_two bobwest with 6 posts (20 thanks)
    3. looks_3 F10trades with 4 posts (9 thanks)
    4. looks_4 planetkill with 3 posts (2 thanks)
      Best Posters
    1. looks_one dyst with 4.5 thanks per post
    2. looks_two bobwest with 3.3 thanks per post
    3. looks_3 F10trades with 2.3 thanks per post
    4. looks_4 arielalejandro with 1.1 thanks per post
    1. trending_up 19,705 views
    2. thumb_up 114 thanks given
    3. group 554 followers
    1. forum 67 posts
    2. attach_file 4 attachments




 
Search this Thread

Micro account vs Funded account (combine)

  #1 (permalink)
arielalejandro
Córdoba
 
Posts: 27 since Apr 2020
Thanks Given: 20
Thanks Received: 28

Hello everyone. First of all I think this thread should go in this forum, if not, please feel free to move it where it belongs, and also I´m not english native speaker, so sorry in advance for any mistake.
Here we go:
I was studying and practicing paper trading with the Thinkorswim platform for quite a long time now with real time data. I started to read about trading and markets probably almost 3 years ago, and when I started to do paper trading basically was a gambling, shooting at everything that moves. Needless to say the result of that so I kept reading but not "trading"
Time passed and started to do paper trading again with an action plan, stop and profit target, sizing, etc etc and with the determination to follow those rules to be as realistic as possible. Things started to do well and I started to be profitable (in the simulator, I know)
Also I read about the psicological effect of being live or not, so here I am now.
I´m in a mini gaunlet 50k combine, trading with only 1 ES contract to keep the losses in check, althou I can´t. Tried to execute as always, with the same parameters as I always did after 6 months of paper trading but I can feel the "fear" knowing that in the end there´s money in stake, even the monthly fee of the gaunlet. $-300 the first day, $-500 today. I don´t know how it will end but I can guess...

So, if I fail with the gaunlet, from your experience, wouldn´t be better to start with a micro account where a big movement in price doesn´t take too much of loss, since the MES only has $1.25 per tick and start from there and forget about earn money (I don´t have the rush to have 1 million in 2 days, I´m not that kind of guys) at least at first but at least get used to been live and at least cover the costs of the operations (fees, commisions and platform?)

On a side note, the reason of taking so much time to decide getting live somehow is because I really wanted to have a strategy that could work and I think I found it, because 6 months of paper trading with military discipline and annotating, each day the results, gave me the confidence to go with the gaunlet.

Sorry for the extension of the post but I wanted to be as clear as possible about the whole situation.
Thank you for you time.
Ariel.

Reply With Quote
The following 8 users say Thank You to arielalejandro for this post:

Can you help answer these questions
from other members on NexusFi?
ZombieSqueeze
Platforms and Indicators
Request for MACD with option to use different MAs for fa …
NinjaTrader
My NT8 Volume Profile Split by Asian/Euro/Open
NinjaTrader
NexusFi Journal Challenge - April 2024
Feedback and Announcements
 
Best Threads (Most Thanked)
in the last 7 days on NexusFi
Retail Trading As An Industry
62 thanks
NexusFi site changelog and issues/problem reporting
47 thanks
Battlestations: Show us your trading desks!
35 thanks
GFIs1 1 DAX trade per day journal
32 thanks
What percentage per day is possible? [Poll]
31 thanks

  #2 (permalink)
 
bobwest's Avatar
 bobwest 
Western Florida
Site Moderator
 
Experience: Advanced
Platform: Sierra Chart
Trading: ES, YM
Frequency: Several times daily
Duration: Minutes
Posts: 8,157 since Jan 2013
Thanks Given: 57,287
Thanks Received: 26,253

This is a good question. I think they have different purposes, depending on the trader.

I would suggest that a more accomplished trader who just wants to get some funding would be better off with one of the evaluation/funding programs.

I think that a trader who needs some live experience is probably better off with a live micro account.

If you trade one of the funding program eval accounts, and if you use a full emini contract like ES, your P/L swings will be much larger and may affect your judgment more. Also, the rules are fairly strict and you have the knowledge that someone else is judging you, which may add to the burden.

If you trade micros in a live account, the P/L swings will be much smaller, and you can focus more on the unique issues of live vs. sim trading.

I do know that some of these funding companies now let you trade micros in their evaluation accounts also, so you may want to look into that.

If you have only done sim trading, and if you are now struggling with the gauntlet, you may be better moving over to a live micro account. Please make sure to not be under-capitalized even in that account, or you will not be able to withstand the normal movement in and out of the account, and you may feel pressure from fear of losses.

You will, absolutely, have losses, because anything that is live or close to live is totally different from sim, no matter how well you have done in sim.

Think about this, and I hope it will prove helpful. Good luck.

Bob.

-------------------

By the way, the "Psychology and Money Management" forum, where you placed it, is a reasonable home for this thread, but I will move it to "Traders Hideout," which is a more general-purpose location. The question is of very general interest and may be relevant to a lot of new traders.

When one door closes, another opens.
-- Cervantes, Don Quixote
Reply With Quote
The following 9 users say Thank You to bobwest for this post:
  #3 (permalink)
arielalejandro
Córdoba
 
Posts: 27 since Apr 2020
Thanks Given: 20
Thanks Received: 28


You have a good argument Bob.
About using micros on the gaunlet, I can but I'm only limited to 2 contracts, so it will take forever to pass the test if I pass it, with the factor of a monthly fee that probably I can save it and open a micros account in AMP or Optimus or any other broker.
I agree with you about not being under capitalized with the micros because any price movement against me and I'm out.
In the meantime, since I already paid for it I'll keep trading the gaunlet as cautious as possible and as feelings detachment as possible. If I screw it up then I'll go for the micros account. So here's the question. What is your suggestion for the amount of money that should I have? Each micro has a margin of $40 and I'm not planning to trade more than 3 or 4. Again, I'm not planning to get rich with it, just to gain the confidence at first to trade live and hopefully cover the trading costs.
Thanks again.

Sent using the NexusFi mobile app

Reply With Quote
The following user says Thank You to arielalejandro for this post:
  #4 (permalink)
 
bobwest's Avatar
 bobwest 
Western Florida
Site Moderator
 
Experience: Advanced
Platform: Sierra Chart
Trading: ES, YM
Frequency: Several times daily
Duration: Minutes
Posts: 8,157 since Jan 2013
Thanks Given: 57,287
Thanks Received: 26,253


arielalejandro View Post
I agree with you about not being under capitalized with the micros because any price movement against me and I'm out.
...
So here's the question. What is your suggestion for the amount of money that should I have? Each micro has a margin of $40 and I'm not planning to trade more than 3 or 4. Again, I'm not planning to get rich with it, just to gain the confidence at first to trade live and hopefully cover the trading costs.
Thanks again.

Sent using the NexusFi mobile app

Use several times the minimum margin. Always do this when trading futures, no matter the contract, and especially if you are using one of the brokers that emphasize small margins.

They know that "you only have to deposit x amount to trade" is a draw to bring in traders who don't have much, but it's not that good an idea for the traders, because it leaves them too thinly funded and too vulnerable to blowing up the account. If you can't manage enough margin, then either reduce your number of contracts or save up some more.

How much is "several times the minimum?" Well, decide what will let you be totally unconcerned about the whole question, and then use more than that.

When you have more experience, you can look at the question again, but start out being very conservative.

By the way, it is also a good idea to recognize in advance that blowing an account may happen no matter what you do, which is a common learning experience. This is not negative thinking, it's realism. And not the end of the world, just a pause. Losses are feedback from reality that something is off, which is good to know.

Another idea is to start a trade journal here, with as objective a self-review of your trading as you can manage. Look at a few journals that are currently active and see if the idea appeals to you. It may help, or, of course, it may not. But many people have benefited from doing it. You will get feedback from others if you want it, and it will be constructive.

Good luck.

Bob.

When one door closes, another opens.
-- Cervantes, Don Quixote
Reply With Quote
The following 7 users say Thank You to bobwest for this post:
  #5 (permalink)
arielalejandro
Córdoba
 
Posts: 27 since Apr 2020
Thanks Given: 20
Thanks Received: 28


bobwest View Post
Use several times the minimum margin. Always do this when trading futures, no matter the contract, and especially if you are using one of the brokers that emphasize small margins.

They know that "you only have to deposit x amount to trade" is a draw to bring in traders who don't have much, but it's not that good an idea for the traders, because it leaves them too thinly funded and too vulnerable to blowing up the account. If you can't manage enough margin, then either reduce your number of contracts or save up some more.

How much is "several times the minimum?" Well, decide what will let you be totally unconcerned about the whole question, and then use more than that.

When you have more experience, you can look at the question again, but start out being very conservative.

By the way, it is also a good idea to recognize in advance that blowing an account may happen no matter what you do, which is a common learning experience. This is not negative thinking, it's realism. And not the end of the world, just a pause. Losses are feedback from reality that something is off, which is good to know.

Another idea is to start a trade journal here, with as objective a self-review of your trading as you can manage. Look at a few journals that are currently active and see if the idea appeals to you. It may help, or, of course, it may not. But many people have benefited from doing it. You will get feedback from others if you want it, and it will be constructive.

Good luck.

Bob.

Yes, about the micros account of course that my idea is to have a good cushion for, let´s say 2 contracts with enough room for price swings according my strategy and several days of probable losses.


bobwest View Post
By the way, it is also a good idea to recognize in advance that blowing an account may happen no matter what you do, which is a common learning experience. This is not negative thinking, it's realism. And not the end of the world, just a pause. Losses are feedback from reality that something is off, which is good to know.

I know and you´re right. Just want to minimize the psicological effect of that and a probable way is to trade micros . Will be easier I think to absorb losses and you always can scale up more gradually one contract at a time.

And last, about journaling here I´ll give it a try to see if I can find it useful which it will probably be because of the quality of people and advices that I saw in other´s journals.
Thanks again.

Reply With Quote
The following 2 users say Thank You to arielalejandro for this post:
  #6 (permalink)
 
dyst's Avatar
 dyst 
Singapore
 
Experience: Intermediate
Platform: NinjaTrader, Sierra, MT4
Trading: ES, CL, NG, XAUUSD, USDJPY
Posts: 109 since May 2015
Thanks Given: 75
Thanks Received: 91

I know how you feel but just a word of caution when dealing with those discount brokers - they will change margins accordingly. It might be $40 per MES lot today required margin but wake up tomorrow and you may hear some overnight volatility thus it is $400 now or something.

This is why my friends always advise me to have the contract value as my account deposit so I would not have problems even if the broker reduce leverage (demand more margin) on the trading lots. 1 MES contract value is around 15k USD now (seniors, pls correct me if I am wrong).

ps: I am trying the gauntlet now too, so good luck to us bro




arielalejandro View Post
You have a good argument Bob.
About using micros on the gaunlet, I can but I'm only limited to 2 contracts, so it will take forever to pass the test if I pass it, with the factor of a monthly fee that probably I can save it and open a micros account in AMP or Optimus or any other broker.
I agree with you about not being under capitalized with the micros because any price movement against me and I'm out.
In the meantime, since I already paid for it I'll keep trading the gaunlet as cautious as possible and as feelings detachment as possible. If I screw it up then I'll go for the micros account. So here's the question. What is your suggestion for the amount of money that should I have? Each micro has a margin of $40 and I'm not planning to trade more than 3 or 4. Again, I'm not planning to get rich with it, just to gain the confidence at first to trade live and hopefully cover the trading costs.
Thanks again.

Sent using the NexusFi mobile app


Numbers work... Magic lies in the numbers
Reply With Quote
The following 6 users say Thank You to dyst for this post:
  #7 (permalink)
arielalejandro
Córdoba
 
Posts: 27 since Apr 2020
Thanks Given: 20
Thanks Received: 28


dyst View Post
I know how you feel but just a word of caution when dealing with those discount brokers - they will change margins accordingly. It might be $40 per MES lot today required margin but wake up tomorrow and you may hear some overnight volatility thus it is $400 now or something.

This is why my friends always advise me to have the contract value as my account deposit so I would not have problems even if the broker reduce leverage (demand more margin) on the trading lots. 1 MES contract value is around 15k USD now (seniors, pls correct me if I am wrong).

ps: I am trying the gauntlet now too, so good luck to us bro

Thank you and first of all, wish you the best with the gaunlet! I feel that trailing drawdown like a boogieman chasing me. Today I used micros and it was a green day. The stress factor was WAAAYY less. I could trade as I always do on the sim and the results showed that.

About what you mention on the margins requeriments, please correct me if I´m wrong but those requeriments change day by day and not intraday basis, right? I´m not planning to hold positions overnight, so if something like you mention happens (volatility and increase margin rise) then at most I won´t be able to trade if the requirement is above my account value. Anyways the plan is to trade no more than 2 micros and have enough cushion to develop the strategy. I´m not planning to open the account with $200. And my first goal will be to cover the monthly cost (commission, fees, etc) no more than that. I need to get exposed to live trading. Then we will how can I scale up or even try a gaunlet again.

Reply With Quote
The following 6 users say Thank You to arielalejandro for this post:
  #8 (permalink)
 
dyst's Avatar
 dyst 
Singapore
 
Experience: Intermediate
Platform: NinjaTrader, Sierra, MT4
Trading: ES, CL, NG, XAUUSD, USDJPY
Posts: 109 since May 2015
Thanks Given: 75
Thanks Received: 91

Yes, the trailing DD is annoying... but the funding firms all claim they have their reasons for enforcing that. But if you want to avoid that, you can sign up for the more expensive "The Gauntlet" which lasts 2 months https://www.earn2trade.com/gauntlet now it costs USD 429 for the 2 months. And since it is so expensive, most of us try our luck with earn2trade's "Mini Gauntlet" which applies the trailing DD.

Yes, the intraday requirement changes day by day but during volatile times like Crude oil earlier this year, the brokers will suddenly demand much more margin at short notice. So first they tell you USD400 for 1 lot QM (smaller crude oil contract)so you are happy and open 2 or 3 lots on your 10k account. Then over weekend or overnight some big news... and later they demand USD5000 per lot QM and since you don't have enough they will liquidate you. Happened to so many people earlier this year...

But if you are not intending to hold overnight, then should be no problem for you. At the most, they will not allow you to open position if margin not enough. But yes this is why most seniors advise people to have at least 20k account before start trading. You have to be exceptionally good to survive 1 year on 10k or 5k starting account


ps: Monthly cost is very low, data fees are cheap if you are not considered professional since you can always go for the 'bundle set'. And many brokers offer free platform, so you can also save on platform fees



arielalejandro View Post
Thank you and first of all, wish you the best with the gaunlet! I feel that trailing drawdown like a boogieman chasing me. Today I used micros and it was a green day. The stress factor was WAAAYY less. I could trade as I always do on the sim and the results showed that.

About what you mention on the margins requeriments, please correct me if I´m wrong but those requeriments change day by day and not intraday basis, right? I´m not planning to hold positions overnight, so if something like you mention happens (volatility and increase margin rise) then at most I won´t be able to trade if the requirement is above my account value. Anyways the plan is to trade no more than 2 micros and have enough cushion to develop the strategy. I´m not planning to open the account with $200. And my first goal will be to cover the monthly cost (commission, fees, etc) no more than that. I need to get exposed to live trading. Then we will how can I scale up or even try a gaunlet again.


Numbers work... Magic lies in the numbers
Reply With Quote
The following 3 users say Thank You to dyst for this post:
  #9 (permalink)
eaglehoof
Parkland, Florida, Broward
 
Posts: 2 since Oct 2018
Thanks Given: 0
Thanks Received: 7

Definitely go to a micro account. If you have not already, add the VWAP to your indicators. Also the standard deviation channel is of help. The biggest skill, in my opinion is when to take a trade and when to sit on the sidelines.

Reply With Quote
The following 6 users say Thank You to eaglehoof for this post:
  #10 (permalink)
dsulli6
Denver CO
 
Posts: 14 since Apr 2019
Thanks Given: 6
Thanks Received: 14


In my experience, the trading combine is a wierd mix between a paper account and a live account. For me, that got me into trouble because I would trade it like a sim account that didn't matter almost. I've been trading on the micro contracts, $400 account gets you started on Ninjatrader brokerage, margin has been a steady $50 for initial margin since they micros came out last year. You can easily still lose or make $100 a day in current market conditions. So don't think for a second that the 10x smaller moves are going to save your account of you trade with FOMO or greed or revenge. Read Mark douglas - trading in the zone, accept the potential loss, and learn to trade consistently above all else. Its only through live trading you can learn this headspace...the combine is just a paid paper account at the end of the day. Risk some of your own money, hell its basically the same price on the micros account to fund it as it is to get a combine these days. And you arent on a time crunch, reoccuring subscription, and you can say you actually trade a live account and are a trader.

Reply With Quote
The following 6 users say Thank You to dsulli6 for this post:





Last Updated on July 31, 2021


© 2024 NexusFi™, s.a., All Rights Reserved.
Av Ricardo J. Alfaro, Century Tower, Panama City, Panama, Ph: +507 833-9432 (Panama and Intl), +1 888-312-3001 (USA and Canada)
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.
About Us - Contact Us - Site Rules, Acceptable Use, and Terms and Conditions - Privacy Policy - Downloads - Top
no new posts