An Attempt to Learn How to Trade Consistently and Profitably

[attempt]

Ok, cash account makes sense, so it's mostly long only, right?

5.) https://www.etf.com/etf-education-c...s-the-creationredemption-mechanism?nopaging=1

Keeping an eye on premium/discount to NAV gives you insight into the authorised participants actions.

I actually have learned about ATP, maybe like 5 months ago, I asked a question on the ETF reddit about supply/demand of ETFs, was confused but I remember reading up on ATP and redemption/creation process. I'll look more into it again.

6.) the 25 delta risk reversal shows you how much otm puts cost vs otm calls, e.g. are people buying protection?
25d fly shows you pricing of ATM vs OTM and timespreads give you an idea of urgency, e.g. when people are rushing for protection they mostly buy short dated puts since they have the most gamma and are cheap on a nominal basis


Start learning about ETFs first. I still find it mind boggling how many people trade these and still have no clue how they work. Do your homework, start with the basics.

After that, get the book by Pierino Ursone (https://www.pierinoursone.com/). It requires basic understranding but it explains the relationships best

Thanks, I'll slowly get into things.

Edit: For your first question I can do both puts and calls.

 

[MrMuppet]

You have to learn the product you trade inside out.
The reason why people trade it, how they trade it and who trades it.

That's why I'd never trade stuff like the S&P, crude or FX, because literally everyone has their fingers in it which makes the product very complex.

The S&P is the worlds most important equity index and the amount of cross flow is insane. Option traders use it to hedge delta, dispersion traders use it to hedge delta and correlation, foreign equity traders use it as a proxy hedge for their own indices, pairs traders, basis traders, basket traders, arbitrageurs, scalpers, market makers, global macro, the list is endless...and you have to make sure you have your eye on flow out of every possible direction.

For a small account it's just not worth it IMO, but you do what you do

 

[MrMuppet]

Edit: For your first question I can do both puts and calls.

you just want to look at how high the 25d put IV is and compare that to the IV of the 25d call

 

[attempt]

You have to learn the product you trade inside out.
The reason why people trade it, how they trade it and who trades it.

That's why I'd never trade stuff like the S&P, crude or FX, because literally everyone has their fingers in it which makes the product very complex.

The S&P is the worlds most important equity index and the amount of cross flow is insane. Option traders use it to hedge delta, dispersion traders use it to hedge delta and correlation, foreign equity traders use it as a proxy hedge for their own indices, pairs traders, basis traders, basket traders, arbitrageurs, scalpers, market makers, global macro, the list is endless...and you have to make sure you have your eye on flow out of every possible direction.

For a small account it's just not worth it IMO, but you do what you do

I appreciate the help, I'll learn anyways . It is good knowledge for the career direction I want. I think I was hiding under a rock while trading, glad I posted this thread, even if my ego took a hit.

 

[QTrader20]

.......

You do this every single day for at least a year and you will notice a drastic improvement in your results.

.......

Maybe I'm not a smart person cuz it took me years to unlearn everything and then, more than 5 years of solid hard works to develop my own trading system and observing it to identify reliable strategies. Forward testing these strategies consumed much more than a year to see how they perform in different market conditions.

So your statement of at least a year is kinda understatement.

If I realize from the beginning how much efforts and time consuming it takes to trade profitably which I spent more than a decade on it, I'd prefer to keep my old boring professional job instead. I could use those spare time to hook up with chics lol...

 

[MrMuppet]

Maybe I'm not a smart person cuz it took me years to unlearn everything and then, more than 5 years of solid hard works to develop my own trading system and observing it to identify reliable strategies. Forward testing these strategies consumed much more than a year to see how they perform in different market conditions.

So your statement of at least a year is kinda understatement.

If I realize from the beginning how much efforts and time consuming it takes to trade profitably which I spent more than a decade on it, I'd prefer to keep my old boring professional job instead. I could use those spare time to hook up with chics lol...

I did not say one year till profitable...5 years is more realistic.

However, when you journal everyday your progress speeds up tremenduously, because you're not making the same mistakes again and again and - in fact - you will stumble uppon one or two setups that really make sense to you....and that's when the fun actually starts.

Everything else is just: copy system found online -> no success -> copy next system -> no success-> book online course -> no success, etc.

 

[MrMuppet]

I appreciate the help, I'll learn anyways . It is good knowledge for the career direction I want. I think I was hiding under a rock while trading, glad I posted this thread, even if my ego took a hit.

Glad it was helpful, but listen:

You're so at the very beginning, you probably looking at 1% of all the stuff you gotta know.
Don't get frustrated and truck along. You won't be making money for a very long time, just be ok with it and stay hungry

 

[attempt]

01/19/2021:
REAL TRADING SESSION
TRADES: 3(LONG) + 1(SHORT)
Winners: 1
Losers: 3
NEWS:

• JANET YELLEN (TUESDAY 10AM EST)
• INAUGURATION
• INTERNATIONAL ENERGY AGENCY REPORT
• BANK OF CANADA RATE DECSISION

CORRELATING MARKETS:

• VOLATILITY:

VIX: -6.4
25 Delta RR: ? (still learning options, don't quite understand how to calculate)
1-3m ATM Calendar: ?
3-6m ATM Calendar: ?​

• INDICES:

NIKKEI: +1.15
FTSE100: +0.14
DAX: +0.27
STOXX50: +0.02​

• METALS:

GOLD: +0.58
SILVER: +1.81
COPPER: +1.24​

• OILS:

CRUDE OIL: +0.97​

• INTEREST:

10Y TREASURY: -0.09​

• CURRENCIES:

USD/JPY: +0.16​

• INDEX MAKEUP(TOP 5):

AAPL: +0.55
MSFT: +0.07
AMZN: +0.42
FB: +1.90
GOOGL: +1.27
TSLA: +1.51​

GAMEPLAN:

MARKET STRUCTURE:

• POSITIVE OUTLOOK, IF ES 3782.25 HOLDS
• IF BREAKS ES 3782.25 POSSIBLE DIP BUY

PERFORMANCE:

LEGEND: BLUE IS LONG & PINK IS SHORT

I got sucked into my plan early on, did not stick to my plan after. Was blind sided by greed and started to chase moves, started to tunnel vision and not sell losses, no plan to sell, was just expecting up, up, up. Noticed VIX and SPY subtleties. Lost money.

Last trade, closed to early, obviously suck but I gotta DEFINE my entry/exit more precisely. Notice I easily want to jump into trades, reminds me when I just started options trading with no PDT trades were coming out like a machine gun.

Anyways I have to end on a early note because I need to send a package to fedex.

 

[BonScott]

I think you need to find a way to trade that suits your personality.
For myself, I always have a stop loss set before I enter, because I need one.
If ever I over-trade to chase any losses, then I go back to doing just one trade a day and then turn everything off. This is very hard to do, but it stops revenge trading.

Today, I think your first trade (long) was against the trend.
I find picking reversals harder than going with the trend.
Good luck with your trading.

 

[attempt]

I think you need to find a way to trade that suits your personality.
For myself, I always have a stop loss set before I enter, because I need one.
If ever I over-trade to chase any losses, then I go back to doing just one trade a day and then turn everything off. This is very hard to do, but it stops revenge trading.

Today, I think your first trade (long) was against the trend.
I find picking reversals harder than going with the trend.
Good luck with your trading.

Yeah, I noticed that. I used to "trend scalp," never used the news before. First time actually. So I needed to get over the issue of just thinking only of my plan. The markets will tell me if my plan is right or wrong, but I shouldn't blindly enter based on my bias. That's what I got in trouble with today, still need the market to play in my favour. I was semi lost until the end. Thanks for the input.