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TopstepTrader's Michael Patak (Founder) - Ask Me Anything (AMA)


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TopstepTrader's Michael Patak (Founder) - Ask Me Anything (AMA)

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  #1231 (permalink)
 Rrrracer 
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Howard Roark View Post
You mentioned $5K in subscription fees. Quite frankly, if that's all anyone pays in tuition to the market that's a really small investment.

Very true. I've lost a lot more than that... on micro currencies, no less, where liquidity can definitely be a problem. That issue has been resolved with the advent of the new wave of micro products, making them an even more viable choice. No doubt that the lessons doled out by the market are most quickly learned in the live environment, with one's own real money on the line. Nothing will better prepare you for the realities of getting punched in the face by the market. This is how I learned.

That said, I do think funding companies serve a valid purpose; discipline, after all, can be one of the most difficult trading skills to acquire. When we trade, we trade by ourselves; we have to not only be traders, but managers. I'd argue that, just starting out, virtually nobody has the skill set to manage themselves effectively while learning to trade at the same time. I can see how some accountability could be beneficial at first so that the focus can be on learning how to trade. Hopefully those skills carry over when the trader decides to venture out on their own.

My point being, this business is a million shades of grey, and there's more than one way to skin a cat. And there's only one way for you to learn how to trade... your own way

We're getting a little off-topic here tho... there's probably another thread where this conversation would be better served.

Edit: Perhaps here

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  #1232 (permalink)
Howard Roark
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Rrrracer View Post
That said, I do think funding companies serve a valid purpose; discipline, after all, can be one of the most difficult trading skills to acquire. When we trade, we trade by ourselves; we have to not only be traders, but managers. I'd argue that, just starting out, virtually nobody has the skill set to manage themselves effectively while learning to trade at the same time. I can see how some accountability could be beneficial at first so that the focus can be on learning how to trade. Hopefully those skills carry over when the trader decides to venture out on their own.

Agreed.

Another thing I learned in my recent Combine is to focus on daily profitability and have a more long-term mindset as with my own account I've been pressing a bit too hard at times trying to get rich in one single day.

It also felt good to feel maybe you were part of 'something' as trading really is a lonely business.

But again - I don't think any of these companies really have any interest in funding a successful trader. That's more like a nuisance for them.

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  #1233 (permalink)
 bobwest 
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Rrrracer View Post

We're getting a little off-topic here tho... there's probably another thread where this conversation would be better served.

Edit: Perhaps here

Actually, that's right. This is an interesting conversation, but this thread is Michael Patak's Ask Me Anything thread, which should be for questions directed to Michael Patak (hence the name ).

The thread suggested by @Rrrracer would be better for this discussion, and it would not be off-topic (although it is not a TopStep thread as such, it is about funding companies in general.)

Let's continue it there, or perhaps in a thread specifically meant for this question. Just not this thread.

Thanks.

Bob.

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  #1234 (permalink)
 matthew28 
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REEBOSAURUS View Post
Sorry if this has been asked before, what are the account level dollar amounts based on? If we get funded at the 50k level how much are we actually allowed to trade?

I remember an interview Michael Patak did a long time ago where he said the names of the Combine levels were just based on the old adage that one should only trade one contract for each $10k of account equity. So a person with a $50k account should trade a maximum of 5 contracts and the $150k account is a maximum of 15 contracts.
It was just an easy way to differentiate between the accounts rather than saying: small, medium, large or whatever.

In the Funded Account/Pro Account (and in Step2), you follow the scaling plan below so you start with a reduced maximum contract size and build up with account equity to prevent people starting badly, then going all in to try and recover and blowing up quickly.
Once you exceed $5k you can request increased risk parameters if you wish (last paragraph).

https://help.futures.topstep.com/hc/en-us/articles/360000140787-What-is-the-scaling-plan-

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  #1235 (permalink)
johnbn1
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Hi Michael. Would it be possible to use Quantower with Rithmic data in the Trading Combine? When setting up a Rithmic connection in Quantower I noticed that Topstep servers were available. I've tried different settings with my Topstep login, but no succes. It would be great to have access to an order book heatmap, without further costs!

Thanks.

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  #1236 (permalink)
johnbn1
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Didn't look like I could edit the above post.. But I got the solution. A trading combine is bound to a specific platform and you can't have access to more than one platform at a time, so one would have to start a new combine with a platform that uses Rithmic data. I think you get access to the full MBO Rithmic data, but I'm not sure on that.

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  #1237 (permalink)
 Poosman 
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Hi Michael, I've been on step 2 now for a few months. Your staff is fabulous and I thank you for creating TST because without it, I doubt I would have had the nerve to do this and I really enjoy it.

Suggestion:

The 'consistency' metric is flawed. The saying goes "Cut your losses and let your winners run". But if you include the reality of how the consistency metric affects your standing with TST it should be amended to read ""Cut your losses and let your winners run but not too much because risking to gain additional profit will not actually bring your profit"

A better approach would be to ditch the 40% rule and pay attention to the Reward/Risk metric after the trader has hit their benchmarks. Let's face it, markets sometimes trend and sometimes chop. The 40% metric penalizes traders that take advantage of the trend and get chopped by ranging markets - but who are ultimately profitable as trend followers.

Suggestion #2:

As a parallel to the above I'd like to see my performance metrics in terms of volatility of the markets I traded. I'm betting that some traders do better/worse in markets with higher/lower volatilities.

Thanks.

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  #1238 (permalink)
 matthew28 
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Poosman View Post
A better approach would be to ditch the 40% rule and pay attention to the Reward/Risk metric after the trader has hit their benchmarks. Let's face it, markets sometimes trend and sometimes chop. The 40% metric penalizes traders that take advantage of the trend and get chopped by ranging markets - but who are ultimately profitable as trend followers.

They only just introduced the 40% metric at the same time as discarding the short lived 20 seconds rule.

I imagine it is to cut out the people who would post their results on the Topstep Facebook page showing one day where they went all in and hit the profit target, followed by all the other days scratching for a tick.
From the Facebook community there have seemed to be two types of Topstep trader, those trying to trade properly and become consistently profitable, or those just trying to fluke their way through the Combines and resetting again and again until they pass to the next stage, in the hope of winning their "free $5k". Especially with the Pro account introduction where it used to be that if you failed in that you went back to Step2. Now they changed that so you only go back to Step2 if the balance is profitable.

At least one other firm has a similar consistency rule. The rule also only applies in Step2 not Step1 (and the Pro account, but obviously not the Funded account as that has no profit target).
If I was funding people I would want proof that they could be profitable on more than one day. With the 40% rule they will see that a trader can at least have a minimum of three good days to reach the target. That doesn't seem to me like an unreasonable thing to be considering when funding day traders.

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  #1239 (permalink)
 Kone 
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Topstep View Post
Hi Bob,

As you gathered, still a work in progress. We will share updates across our channels as they come to fruition.

Thanks!



Thanks Topstep. So Sierra Chart is now available

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  #1240 (permalink)
 bobwest 
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Kone View Post
Thanks Topstep. So Sierra Chart is now available

Just saw this. Looks like it is:

https://help.futures.topstep.com/hc/en-us/articles/4409422051475-Sierra-Chart-Connection-Instructions

Bob.

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