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Using two different PROP firms, I am thinking of 5 long positions(NQ, ES etc.) in Prop firm A, then 5 short positions on prop firm B. what do you think? I will blow one of the two accounts but potential profit is incredible. anyone tried this?
It isn't though is it, because you are on sim trial accounts, so no incredible potential profit.
You will just pay for two accounts, blow one out and then in theory make a big profit on the other one unless the trade reverses. And then what, most of the online "prop" firms have a maximum daily percentage or consistency rule so you can't make the target in one go so what do you do the next day and the day after that, A consistency target of 30% is common so you need four good days or more. Flipping a coin and getting lucky going long or short isn't going to help either if you do eventually pass and have ONE funded account you are supposed to trade in a vaguely professional way using a system you have proven you have an edge with to aim for consistent profitability. That's the goal, not lucking in to very briefly having a funded account.
You do not win as a trader, you just get to play again the next day. If that game doesn’t appeal to you then you should not trade. Gary Norden
what I tried and kinda succeeded was this: I had two accounts with two different firms.
A: 5 ES long made $2500 profits
B: 5 ES short: lost $2500 hit the trailing drawdown and of course blew it
There seems to be a way to go back and forth, say once I hit $1500 profit, I will close positions on acct A and B. I am now down $1500 on B so I will try to recover some loss, once I recover loss on account, B, I will repeat. lol oh well. it's hard to beat the market.
Have you ever heard of futures options being traded or existing at all?
You can choose a market and then you buy a call option in that market and at the same time you sell a call option on another strike level.
This type of trading is called: "Vertical Call Credit Spread trading". You can also do this with put options. If you are correct in your assessment of the market, then you can keep the profit between the two options, because of different strike levels, on the expiration date of the option and otherwise the profit goes to the other side.
Advantage compared to the pure futures spread with different companies: Relatively small margins and thus you can, depending on the size of your trading account, build entire portfolios with those "spreads".
This simply as an alternative idea to what you have addressed. Followin just one link to see a bit more about what I am talling:
The trade you describe is perfectly reasonable, if someone is into trading options. But the "long and short position" being described by @andwhysee is not at all like the spread trading you describe. He is long and short the same instrument, with the two trades being executed by different prop firms (possibly using different brokers), which is not a legitimate trade under exchange rules.
The idea is to have one prop firm swallow the losing trade because he blows up his account there, while he takes the profit from the winning trade, making a withdrawal from the firm that housed the account with the winning trade.
This is not a winning strategy for the long term, and will get his accounts closed out if the firms involved find out what he is doing.
See my comments in my next post, below.
Bob.
When one door closes, another opens.
-- Cervantes, Don Quixote
