2k to 20k

[Sekiyo]

What happens when you are at 80% daily max of your loss from the previous trade? Then you put on another trade because you have not hit 100%.

Is the new loss limit 20% the new trade of your max loss or is it 100% of a trade? And if it happens you end up with 180% of max loss.

I.e. how will you account for the difference between max loss per trade and daily loss maximum?

I don’t see it this way.
If daily max risk is 5% divided by 5 trades,
Max risk per trade is 1%. Maybe less but not more.

I can hit losses such as -(1, 1, 1, 0.5, 0.5)
In this case I have 1% left after 5 trades.
Either take more trade or stop after 5 trades.

But I won’t risk more than 1%.
Worst case is -(1, 1, 1, 1, 1)

 

[longandshort]

The only people who told me anything are me and myself.

Some futures like ZN or ES are liquid enough to be tradable and structured on the 1min.

1min is the same as hourly or daily or weekly.

They all mean revert on the shorter term and trend on the longer term.

That’s not true and is also not consistent with some of your trading tactics (“buy breakout, sell breakdown”).

Prices are mean reverting between informational events, but *you* do not know if price holds information (of subsequent flow). Most of the moves in the market are not things you can take advantage of, but a subset of them are, and you should only focus on trading those (and making sure you have a tight filter and workflow to identify them).

 

[Sekiyo]

That’s not true and is also not consistent with some of your trading tactics (“buy breakout, sell breakdown”).

Prices are mean reverting between informational events, but *you* do not know if price holds information (of subsequent flow). Most of the moves in the market are not things you can take advantage of, but a subset of them are, and you should only focus on trading those (and making sure you have a tight filter and workflow to identify them).

Agree with the fact that there’s no edge most of the time.

What’s not true ?

I mean that on every time frame,
You better buy below short MAs (Mean Reversion)
You better buy above long MAs (Trend Following)

Holds true for every timeframe.

 

[longandshort]

What’s not true ?

I mean that on every time frame,
You better buy below short MAs (Mean Reversion)
You better buy above long MAs (Trend Following)

Holds true for every timeframe.

1) you may be confusing your long MA strategy with the markets general profile (historically has moved higher over time); what you’re not thinking about is the large drawdown risk, it is essentially the same risk as buying and holding
2) prices don’t mean revert in shorter timescales because prices are non-stationary geometric random walks anchored by information (which can be macro, idio, flow based, etc.) … so while there is some evidence of mean reversion between information, the tradeable amount of opportunities are a small % of total trades through the day. If you’re trying to trade 1m charts you are getting so lost in the trees that you’ll never find the forest.

There’s this idea that successful traders are constantly moving money, trading here and there, “busy”, etc. Trading is more like hunting.. a lot of hard work/patience/waiting to identify an opportunity and then hope to catch it before anyone else does.

 

[Sekiyo]

1) you may be confusing your long MA strategy with the markets general profile (historically has moved higher over time); what you’re not thinking about is the large drawdown risk, it is essentially the same risk as buying and holding
2) prices don’t mean revert in shorter timescales because prices are non-stationary geometric random walks anchored by information (which can be macro, idio, flow based, etc.) … so while there is some evidence of mean reversion between information, the tradeable amount of opportunities are a small % of total trades through the day. If you’re trying to trade 1m charts you are getting so lost in the trees that you’ll never find the forest.

There’s this idea that successful traders are constantly moving money, trading here and there, “busy”, etc. Trading is more like hunting.. a lot of hard work/patience/waiting to identify an opportunity and then hope to catch it before anyone else does.

That’s what makes a market,
It’s fine to be in disagreement.
Now if we truly want to prove a point,
We might need more than just some words.

Thanks for sharing your insights.
Have to read more into your post.

 

[Rams Fan]

prices don’t mean revert in shorter timescales because prices are non-stationary geometric random walks anchored by information

You talk to your mother with that mouth?

 

[easymon1]

Prices are mean reverting between informational events

Sounds good.
What timeframe charts do traders of this hypothesis operate?
Are there any papers or backtests available online about "Prices are mean reverting between informational events"?

 

[Laissez Faire]

2K to 20K should be possible. Let's look at some basic simulations/parameters.

1. If you can net 3.5 ES points / $17.50 per MES contract/per day and allocate $1500 margin per contract you'll hit your target after 242 trading days. Initially, progress is slow and you'll be trading 1 contract for about 60 days before you can move on to 2 contracts.

2. If you trade more aggressively allocating $750 per contract you'll hit your target after 110 trading days.

However, due to the effect of compounding which eventually snowballs rapidly your account will hit $218 912,50 with this simulation where you top out with 100 MES contracts after 250 trading days.

The question then is what's possible to take home on a daily basis?

The average RTH range on ES was 74,50 points in 2022.

So, 3.5 ES points is 5 % of the daily average range.

If, instead, we look at the average daily sum of the major swings the number was 131 points for 2022. 3.5 ES points is about 3 % of that number.

So, the points are definitely there for grabs and 3.5 points should be a modest daily target.

Now, being able to do this consistently is very hard and beyond reach for most. The point is however to illustrate that a more modest daily take done consistently actually can give you substantial returns if all profits are kept in the account for compounded growth. You don't need to hit a homerun every single day.

I would advice you to be very careful trading the opening period. Maybe avoid trading for the first 30 minutes completely as it can be a wild period where it's very easy to get on the wrong side of the market if you don't really know what you're doing.

Good luck and happy new year.

 

[Sekiyo]

2K to 20K should be possible. Let's look at some basic simulations/parameters.

1. If you can net 3.5 ES points / $17.50 per MES contract/per day and allocate $1500 margin per contract you'll hit your target after 242 trading days. Initially, progress is slow and you'll be trading 1 contract for about 60 days before you can move on to 2 contracts.

2. If you trade more aggressively allocating $750 per contract you'll hit your target after 110 trading days.

However, due to the effect of compounding which eventually snowballs rapidly your account will hit $218 912,50 with this simulation where you top out with 100 MES contracts after 250 trading days.

The question then is what's possible to take home on a daily basis?

The average RTH range on ES was 74,50 points in 2022.

So, 3.5 ES points is 5 % of the daily average range.

If, instead, we look at the average daily sum of the major swings the number was 131 points for 2022. 3.5 ES points is about 3 % of that number.

So, the points are definitely there for grabs and 3.5 points should be a modest daily target.

Now, being able to do this consistently is very hard and beyond reach for most. The point is however to illustrate that a more modest daily take done consistently actually can give you substantial returns if all profits are kept in the account for compounded growth. You don't need to hit a homerun every single day.

I would advice you to be very careful trading the opening period. Maybe avoid trading for the first 30 minutes completely as it can be a wild period where it's very easy to get on the wrong side of the market if you don't really know what you're doing.

Good luck and happy new year.

View attachment 302799

Amaizing !

Thank you for the facts + positive vibes.

That’s exactly my point,
To compound small gains on a daily basis.

However I was thinking about more points for less margining.

More like 2500$ margin for 5 points.

Daily range sounds better than average swings,
Because I believe average swing requires holding overnight.

That’s a risk I don’t want to be taking.

Percent wise … 1000% is about 1% per day.
1.01^252 = 1227%

Ideal target would be -1% or +3% per day,
If half the day are one or the other,
The expected value is 1% / day.

But at the very beginning I’ll have to risk more.
4 MES points represent 1% of my 2000$

Wish you a happy new year !

 

[semperfrosty]

You talk to your mother with that mouth?

Nice! hahaha