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Kevin's TST Combine Journal
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Kevin's TST Combine Journal

  #71 (permalink)
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kevinkdog View Post
Agreed. This would have to be verified through historical testing. My initial testing did not yield anything worthwhile, so I am not doing it in the Combine.

The idea comes from the fact that most systems I have developed do better with bigger stops, and having a daily loss limit (stop) of $400-500 per trade is really a tough constraint. If the stop was instead $800-1000, a lot more trading systems become plausible.

Development of such a "two step" system is much more difficult, though.

Would one of the larger combines work better? This would give you more room. But of course the profit objective become larger as well.

Plan your trade, trade your plan.
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  #72 (permalink)
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Assuming each trade has roughly the same probability, then the same risk should be used on each trade.

Quite to the contrary. Maybe if you have a wide DLL in your own account, but the combine has special rules with a tight DLL and you have to strategize accordingly.

Let's have an example. In the 30K Combine Kevin is trading 2 ES contracts. the DLL says he can be wrong up to 4.5 points, and no more. If he has two 2-2 points losers at the beginning of the day, the trading for the day is pretty much over, because very little cushion is left. Now if he has 2-2 pts winners, he has a 8 pts cushion and he can go 3 contracts for the next few trades.

The same logic if he starts out with 1 contract. If he wins 4 points in the morning, his cushion for even 2 contracts is now 7 pts for the rest of the day. In my first Combine I played it too safe, used only 1 contract and although I was profitable, I didn't make enough...

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  #73 (permalink)
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Brewer20 View Post
Would one of the larger combines work better? This would give you more room. But of course the profit objective become larger as well.

Good point. Potential Combiners should take a look at the different levels, because the profit targets , daily loss limit, and max drawdown don't scale linearly.

Compare the $30K and $150K 20 day Combines, for example...

The starting amount is a factor of 5.
The max position size is a factor of 5.
The Daily loss limit, though, is a factor of 6. (better to do $150K)
The max drawdown is only a factor of 3 higher. (better to do 30K)
The profit factor is a factor of 8 higher, though. (better to do 30K)

So, depending on one's strategy, one size combine may be much more desirable than another.

The caveat here is that after the Combine, some of the rules change, so designing JUST for the Combine may not work in the long run. And if you are not doing this for long term success, what is the point?

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  #74 (permalink)
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Kevin, let me know if we are offtopic, I can move the conversation, but I like to discuss the Combine.

For most people I would say the 50K combines are the best and Mr. Patak said those are the ones passed successfully by most. It gives more contracts so one can trade 2-3 instruments at the same time, if passed you can actually make decent money with it (unlike the 30K) and it is relative cheap. Also wider DLL.

If someone is real good, they can always try bigger combines later, but to start out right away with the 100K and 150K, you need balls and you have to be cocksure of yourself. But there is really no point in trying to climb the highest mountain first...


Last edited by Pedro40; April 5th, 2013 at 11:38 AM.
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  #75 (permalink)
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Pedro40 View Post
Quite to the contrary. Maybe if you have a wide DLL in your own account, but the combine has special rules with a tight DLL and you have to strategize accordingly.

Let's have an example. In the 30K Combine Kevin is trading 2 ES contracts. the DLL says he can be wrong up to 4.5 points, and no more. If he has two 2-2 points losers at the beginning of the day, the trading for the day is pretty much over, because very little cushion is left. Now if he has 2-2 pts winners, he has a 8 pts cushion and he can go 3 contracts for the next few trades.

The same logic if he starts out with 1 contract. If he wins 4 points in the morning, his cushion for even 2 contracts is now 7 pts for the rest of the day. In my first Combine I played it too safe, used only 1 contract and although I was profitable, I didn't make enough...

I admit I haven't run the math on this...but if the probability of a win is the same for each trade. When he scales up, isn't he as likely to get close to the DLL as he is to have a stellar gain. Keeping the lot size the same, seems more likely to keep you the game. But I could be wrong...

However, the strategy will have to generate enough profit to pass the combine. If it won't, then you do have an issue.

Plan your trade, trade your plan.
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  #76 (permalink)
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Pedro40 View Post
Kevin, let me know if we are offtopic, I can move the conversation, but I like to discus the Combine.

For most people I would say the 50K combines are the best and Mr. Patak said those are the ones passed successfully by most. It gives more contracts so one can trade 2-3 instruments at the same time, if passed you can actually make decent money with it (unlike the 30K) and it is relative cheap. Also wider DLL.

If someone is real good, they can always try bigger combines later, but to start out right away with the 100K and 150K, you need balls and you have to be cocksure of yourself. But there is really no point in trying to climb the highest mountain first...


To me, so much of the Combine starts with your goals and objectives. Some people may just want to get a "foot in the door" and have limited funds to spend on Combines (I bet most people don't pass the first one). They might be better off doing the $30K. Others may think "I'm only in this for the possible money down the road" in which case maybe $150K is better, although if you are not used to trading that level in real life, you might have problems trading it in a Combine or afterwards if you pass.

The key, in my opinion, is to base your Combine start amount on your long term objectives. Once you have that established, you can look at developing/altering your trading strategy to meet all the rules of the Combine and beyond.


I'll give an example of how I did NOT do that: after I developed my strategy for the Combine, I found that once you pass, your daily loss limit also becomes your weekly loss limit (a new requirement). Had I checked this beforehand, I would have developed my strategy differently.

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  #77 (permalink)
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kevinkdog View Post
and have limited funds to spend on Combines

The price difference is minoscule between the 30K and 50K, only $15... Passing the 30K is only good for pocketmoney, after taxes and profitshare...

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  #78 (permalink)
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kevinkdog View Post
The caveat here is that after the Combine, some of the rules change, so designing JUST for the Combine may not work in the long run. And if you are not doing this for long term success, what is the point?

This point right here is the most salient point made about the combines. The rules change AFTER you win a combine and trading to pass the combine is simply short sighted in my view.

A better strategy would be to submit a custom combine proposal that mirrors what the rules change to after the combine is won. Admittedly, this can be an even tougher way to win a combine but its far more realistic of what you will be trading if you win.

The smart trader will include in the proposal those metrics he/she knows they can achieve and ask for those metrics they have trouble with or have kept them from winning a combine in the past excluded from metrics the scouts review.

If anyone has any questions regarding this, PM me and I will be more specific.

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  #79 (permalink)
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PandaWarrior View Post
This point right here is the most salient point made about the combines. The rules change AFTER you win a combine and trading to pass the combine is simply short sighted in my view.

A better strategy would be to submit a custom combine proposal that mirrors what the rules change to after the combine is won. Admittedly, this can be an even tougher way to win a combine but its far more realistic of what you will be trading if you win.

The smart trader will include in the proposal those metrics he/she knows they can achieve and ask for those metrics they have trouble with or have kept them from winning a combine in the past excluded from metrics the scouts review.

If anyone has any questions regarding this, PM me and I will be more specific.


I agree. I think you have the best chance of long term success by following the same rules during the Combine, and afterwards.

If you have any questions please send me a Private Message or use the futures.io "Ask Me Anything" thread
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  #80 (permalink)
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Combine, Day 7


Day 7 of my 20 Day Combine -

A nice small winner overnight.


If you look through all my trades, you may be thinking "how in the world will you pass the Combine taking small profits and bigger losses?"

The short answer is "I won't. I need big winners."

The slightly longer answer is that my Strategy #2, that trades during the day, should be my "workhouse" strategy, providing most of the profits. So far, it has not done that. It goes for the big win (essentially no profit target, but rather a time exit at 3 PM). The drawbacks to this strategy are
1) it does not trade often enough
2) it has around only 45% winning percentage.


Note that both of Strat #2 drawbacks will cause me to fail the combine. So, I had to develop some other strategies which
1) traded more, so I would hit the 20 day minimum within 60 calendar days
2) would raise the overall winning percentage above 50%
3) would provide extra profit to meet the profit goal.

So that is what you see with the overnight strat #1 - a high percentage strat, that is mildly profitable. It definitely will help me meet the Combine goals.



OK, now I know you guys are smart enough to be thinking "your approach of 3 strategies seems awfully complicated. Why not just create one good strategy and be done with it?"


Short answer: "I couldn't."

Long answer: I had only 3 weeks to develop this strategy. When I got relatively close to Combine goals with Strategy #2, the best option was to add 2 additional strategies to get me over the hump (rather than chuck the almost good strat #2 in hopes of finding an even better one).

As for excuses, I typically don't devise intraday strats (although I am looking at them more), and I have never developed a strategy with so many requirements. But I took on this Combine challenge knowing all this, so the excuses are not valid at all. Frankly, all things considered, I'm lucky I created what I did.

Is what I developed good enough? I guess we will see...


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