$2,000 to $200,000 in 2020 at 2.00% per day.

[7out]

It was discussed before 7out, and personally I feel sstheo is probably better of sticking to his plan: growing his account on a slow and steady pace. I would not call 2% slow by the way.

Though my account is a bit bigger I also switched to MES a couple of weeks ago. With this volatility a couple of normal stops with ES is all it takes to be 1k in the red and that would hurt his account for sure. He would probably be affected emotionally, I know I am. Even when a strategy is very clear there are a lot of decisions to be made to manage the trade, and being completely relax helps to think clear.

Your advice is great but being so experienced you probably forgot how trading with scared money feels. I don't mean this in a negative way, take it as a compliment: you are a more mature trader.

I look at it this way: if he keeps up what he is doing he will be trading regular ES soon enough with peace of mind, so why rush and make it more difficult emotionally?

I disagree completely and hopefully I can explain it to you.
No one is suggesting he goes for broke, but he can risk 10% of account (approx $500) and trade 1 ES the way he trades MES. he's pretty MUCH scalping for pennies ($10 or less average per trade), he can easily take a shot and try the exact same thing but using 1 ES. If he loses 5 trades, then fine - he took a shot and failed, no big deal.

However, he currently has an edge. HE MUST LEARN TO MAXIMIZE IT WHILE HE STILL HAS IT, because there is no guarantee of tomorrow. If he succeeds on the first 3 trades, that'll give him great leverage to continue - and if he all of a sudden fails to continue this path with ES (assuming all else is the same) then he has a mental impairment for trading and it will hinder him going forward and he'll just be wasting his time.

Think of it like in poker, you have AA preflop. There is plenty of action before the action gets to him. He must shove all his chips in the middle to lock up all the loose money out there already and if anyone calls him (yes he has a chance of losing, but he'll now be a heavy favorite to win more). He must go for it.

In a gambling situation, you're in a casino and you see a table cheering and going crazy. Let's say craps - the shooter is rolling and table is going crazy, you jump on for the remainder of that roll and press the crap out of it. You can only lose (lets say $100, but if the roll continues for a short while you can collect that $100 and make much more freerolling the casino, since the plan is to leave after the roll is over regardless if up or down. Same thing can happen on a baccarat table, you walk up and everyone is going crazy. You see the last 7 hands were won by banker, you run with the banker until the streak ends. Please don't take my gambling scenario too literal, but he currently has an edge. He must learn to maximize it, not wait for it to end and then try to recreate it.

 

[Micro MadMan]

@7out interesting perspective on exploiting a potentially depreciating edge. With over ten years full time experience trading can you tell us how often your edges lasted'? How often did you have to recreate them, if ever? If you did recreate them; were they more like a slight modification of a previous edge or more similar to reinventing the wheel, i.e. a long painful process of discovering something totally new and different than before?

 

[RubberBand]

I disagree completely and hopefully I can explain it to you.
No one is suggesting he goes for broke, but he can risk 10% of account (approx $500) and trade 1 ES the way he trades MES. he's pretty MUCH scalping for pennies ($10 or less average per trade), he can easily take a shot and try the exact same thing but using 1 ES. If he loses 5 trades, then fine - he took a shot and failed, no big deal.

However, he currently has an edge. HE MUST LEARN TO MAXIMIZE IT WHILE HE STILL HAS IT, because there is no guarantee of tomorrow. If he succeeds on the first 3 trades, that'll give him great leverage to continue - and if he all of a sudden fails to continue this path with ES (assuming all else is the same) then he has a mental impairment for trading and it will hinder him going forward and he'll just be wasting his time.

Think of it like in poker, you have AA preflop. There is plenty of action before the action gets to him. He must shove all his chips in the middle to lock up all the loose money out there already and if anyone calls him (yes he has a chance of losing, but he'll now be a heavy favorite to win more). He must go for it.

In a gambling situation, you're in a casino and you see a table cheering and going crazy. Let's say craps - the shooter is rolling and table is going crazy, you jump on for the remainder of that roll and press the crap out of it. You can only lose (lets say $100, but if the roll continues for a short while you can collect that $100 and make much more freerolling the casino, since the plan is to leave after the roll is over regardless if up or down. Same thing can happen on a baccarat table, you walk up and everyone is going crazy. You see the last 7 hands were won by banker, you run with the banker until the streak ends. Please don't take my gambling scenario too literal, but he currently has an edge. He must learn to maximize it, not wait for it to end and then try to recreate it.

It is interesting what you say. I think maybe going to 1 ES is a big jump, but there is no reason why he shouldn't be able to do 2 or 3 micro ES. Looking at the stats he shares, most trades are in the green. With 2 micro ES, the profits would simply be double. There is so much data from his trades over the past few weeks, so if all of a sudden he had 3 losing days in a row, it would be obvious that he has, as you put it, a mental impairment.

There is almost no reason why he hasn't gone up in micro contracts other than perhaps a mental impairment. The volatility doesn't really seem to matter since he has tight stops and tight targets. I have to wonder if perhaps he will end up suffering the fate that traders do when they switch from trading in the simulation mode to going live. They don't end up trading the same way when its real, and then results end up being the complete opposite. By trading just 1 micro contract, it might be easier on the emotions, but this is kind of like trading when it isn't real. Going to 5 or more contracts would then make it real, and he will be scared and do things differently, and then not be able to maintain the 2% target with a bigger account.

 

[sstheo]

I'm sorry if I come across rude (definitely not trying to be), but is this what you do full time?

Though I haven't studied your trades but you do seem profitable - at least since doing this challenge. Why don't you size up, since I see your average trade yields less than $10 profit/loss. Surely the account can handle a 10x swing (ie an ES contract) . If after 5 trades you see it doesn't work for you, you can always size down, but if you have an edge and the stats are correct after 5 successful trades you'll be freerolling the account (just go back to micros after 5 losing trades until you regain your confidence).

This coming to you from someone who traded Full time for a decade and 100x-plus larger account. Treat the trades like units, if you can be profitable to start and just focus on your trades, you'll be golden - don't think of the money!!!

Sorry, I didn't answer your first question. I am a full time real estate broker, but I have no agents working for me. I work mainly with investors who don't need to be driven all over the place, so watching the screens works out well for me - while I research investment properties in the mornings.

Obviously a singular focus would be better for either task, but I have found a nice balance that works for me.

Especially with the virus all around us, I am eager to keep making trading work. I had 3 nervous investors back out of deals in the last 7 days, so I can't tell you what is going to happen in the next couple months in my market - which is supposed to be the hottest time of the year.

 

[sstheo]

@7out, @RubberBand Thanks for the interest. I do feel like I have an edge, and I am eager to follow the original plan and scale up. I hope to be able to do it soon.

Here is a histogram of the ES 3-day average ATR. I love the roller coaster ride for volatility. There is no shortage of trades, that is for sure. But you have to admit that the risks are still elevated considerably.

If I were perfectly disciplined, then perhaps I could have stayed on Plan A, but sometimes I break my rules. The drop in contract size was designed specifically, exactly, precisely for me to stay alive and not commit account suicide during a tweet, Covid-19 death report or other unexpected systemic shock. I did exactly what the CME mandated with margins recently.

Fortunately, AMP has lowered the margins again, and I take it as a sign to be able to dip my whole foot in the water and not just a toe. I will soon be a little more aggressive. When the ATR 3-day average hits 60 again, then I will resume my scaling plan. For now, I am happy to be hanging on with one or two contracts.

 

[7out]

@7out interesting perspective on exploiting a potentially depreciating edge. With over ten years full time experience trading can you tell us how often your edges lasted'? How often did you have to recreate them, if ever? If you did recreate them; were they more like a slight modification of a previous edge or more similar to reinventing the wheel, i.e. a long painful process of discovering something totally new and different than before?

There is no best before date on edges, it can simply falter one day for good. Like poker the game changes over time, you must continuously study and be up to date. I suggest anyone actively trading, to spend 1 hour every night (a few hours after the trading day or even 1 hour before heading to bed for the night - my favorite) looking at charts and have a notebook to make notes. In my experience you usually modify something that you are familiar with to start. I still refer to my trading guide (that I created for myself from over 20 years ago). I recently spoke to a friend who used the same technique for the last decade doing well for himself. As the market started going crazy in late February he kept getting stopped out of every trade and suffering mentally from the sudden lack of success. Although he has always traded full time, he decided to take time off to save himself mentally.

Another great idea, which doesn't exist today was to trade at a live place like Swift Trade, where you have a lot of aspiring traders mixed in with seasoned traders. You pick up a lot of tips like that. Even novice traders have good ideas, but need a little guidance to make it into a workable one.

Here is an idea that I see is working (though I no longer actively day trade), using a 5 minute chart of the indexes (I usually watch S&P), add bollinger bands and the moving average of past 20 time periods. You'll notice, once bar chart closes above or below that 20 (time period) moving average you can make a trade with the continuation trend - but I would use multiple contracts, one to eek out a small profit to cover a loss if the trade on the other contract doesn't pan out like expected and then let the other one run.

Will try to respond more late tonight.

 

[7out]

Obviously a singular focus would be better for either task, but I have found a nice balance that works for me.

You'd be surprised how better focused you are when you don't do only one thing consistently, assuming that the things you are doing, you are already proficient in. As long as both occupations don't require 40 hours a week each, it's a good idea to step back do something else and return. It's like sleeping, it allows the body to regenerate and you return more refreshed. Full time trading is probably the most stressful full time job I have ever had.

I'm going to send you a private message with my info, I'd like to talk to you. Then one day I want to be online live with you while you trade and see if you can begin to achieve your true capabilities without fear.

 

[Micro MadMan]

Wow Steve looks like you're getting offered a trading partnership on a joint account. I actually was offered and took a parternship from a well known guru bases on my live results and calls in a trading a room when I traded full time. We did good for awhile but.......spoiler alert conditions changed and I couldn't beat the market anymore.

Whatever happens and if you do get offered make sure it's on your terms and DO NOT give up other things to go full time until you're totally comfortable (i.e. 500K trading profits in the bank).

 

[Overnight]

If I were perfectly disciplined, then perhaps I could have stayed on Plan A, but sometimes I break my rules. The drop in contract size was designed specifically, exactly, precisely for [B]me[/B] to [B]stay alive[/B] and not commit account suicide during a tweet, Covid-19 death report or other unexpected systemic shock. I did exactly what the CME mandated with margins recently.

Fortunately, AMP has lowered the margins again, and I take it as a sign to be able to dip my whole foot in the water and not just a toe. I will soon be a little more aggressive. When the ATR 3-day average hits 60 again, then I will resume my scaling plan. For now, I am happy to be hanging on with one or two contracts.

Do exactly what you are doing, and do not lose focus. I was doing fine on a micro here and there, and then saw another entry, and mistakenly did it on YM, 1 contract. Lost 400 bux in about 1 minute.

Discipline is required here, now, and at all-time-high alert. This market movement is FUCKED UP!

 

[sstheo]

Do exactly what you are doing, and do not lose focus. I was doing fine on a micro here and there, and then saw another entry, and mistakenly did it on YM, 1 contract. Lost 400 bux in about 1 minute.

Discipline is required here, now, and at all-time-high alert. This market movement is FUCKED UP!

Thanks @Overnight Ouch. I actually have at least one doozie of a technical error weekly. I am currently working on simplifying things to minimize those errors.

You have seen my ability to resist those who want me to shift into second, third, and fourth gear with my pedal to the metal. Not worry about my going too fast here... All in good time!