Like 23 years ago I started what I call "Dumb Journal", it has all the trades I had a urge to put on, so I paper traded them, and told myself when I can get winning percentage over 50%, I would go back to trading what I see. After adding it all up each year, always like 5% winning trades, I still put some trades in it to see if I am getting any better as far as my "feel" and these feel good trades seldom ever win. I never trade as I feel, I am good system trader and that's it.
Can't win in futures trading
- Thread starter ctmvas
- Start date
The banksters dropped a Trillion - they are all professionals still in business.Most pro's lose money they rely 100% on a flow of new dumb money-that could be you.
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You are not alone. Futures suck.
You can liken the financial markets to baseball. You have different levels of play, you have college baseball, the minor leagues, and finally the major leagues.
College baseball is the OTCBB market, where you have mostly amateurs being used as sacrificial lambs and pawns in the larger game to enrich those who rule its market (promoters, boiler rooms, companies profiting from selling stock, not products/services.).
The minor leagues are the listed stocks, with small caps the A level, mid caps the AA level, and large caps the AAA level. The higher the level, the more efficient the market and the stronger the competition. Small caps, or the A level, have more of a mix of retail and institutional players, and if the volume is large enough, HFTs. Most of the institutions and HFTs are crowded into the AA and AAA level.
Lastly, the big boys play in the futures market, the major leagues. This is all HFTs, large banks, hedge funds, and other institutions at war with each other in a negative sum game. While theoretically zero sum, the commissions/exchange fees collected by the brokers and exchanges make it strongly negative sum. And it is not a trivial amount. It makes it extremely difficult to beat this league due to the strong competition and efficiency of the market.
Even among the futures markets, as you go up the liquidity curve, the higher the liquidity, the more competition and the more difficult it is to make money. The all stars in the league congregate around the big markets, stock index, FX, fixed income, and crude oil/gold. The smaller markets like the ags, softs, industrial metals, livestock, etc. are the journeymen. A bit less efficient, but still not easy.
Only seasoned professionals make consistent money in futures. You are not going to beat the futures market by reading some trend following drivel regurgitated by Covel or with an Al Brooks e-mini trading course. It takes disciplined money management, a resilient and repeatable edge, and constant data analysis. Unfortunately, the futures market seems to attract get rich quick types attracted to the huge leverage but not willing to put in the work or manage risk well enough to be profitable.
99.9% of people on ET should stick with stocks.
College baseball is the OTCBB market, where you have mostly amateurs being used as sacrificial lambs and pawns in the larger game to enrich those who rule its market (promoters, boiler rooms, companies profiting from selling stock, not products/services.).
The minor leagues are the listed stocks, with small caps the A level, mid caps the AA level, and large caps the AAA level. The higher the level, the more efficient the market and the stronger the competition. Small caps, or the A level, have more of a mix of retail and institutional players, and if the volume is large enough, HFTs. Most of the institutions and HFTs are crowded into the AA and AAA level.
Lastly, the big boys play in the futures market, the major leagues. This is all HFTs, large banks, hedge funds, and other institutions at war with each other in a negative sum game. While theoretically zero sum, the commissions/exchange fees collected by the brokers and exchanges make it strongly negative sum. And it is not a trivial amount. It makes it extremely difficult to beat this league due to the strong competition and efficiency of the market.
Even among the futures markets, as you go up the liquidity curve, the higher the liquidity, the more competition and the more difficult it is to make money. The all stars in the league congregate around the big markets, stock index, FX, fixed income, and crude oil/gold. The smaller markets like the ags, softs, industrial metals, livestock, etc. are the journeymen. A bit less efficient, but still not easy.
Only seasoned professionals make consistent money in futures. You are not going to beat the futures market by reading some trend following drivel regurgitated by Covel or with an Al Brooks e-mini trading course. It takes disciplined money management, a resilient and repeatable edge, and constant data analysis. Unfortunately, the futures market seems to attract get rich quick types attracted to the huge leverage but not willing to put in the work or manage risk well enough to be profitable.
99.9% of people on ET should stick with stocks.
I agree and instead of just saving 30k to properly daytrade stocks, they prematurely get the itch to gamble in an arena way out of their league, and with 5k, the margin for error is almost zero.
Liquidity is a double edged sword. The attractive risk profile is almost inversely proportional to the profit potential
There are ways to win in futures trading but if you're underfunded, over trade or get too greedy, you're more likely to lose. You should trade like a sniper and not focus on home runs. You should trade 1 contract per $10k. You can get away with $5k to $7k per contract but not advisable. Also, if you're not properly educated in futures, you can lose a lot. I've seen many unprepared dreamers come in and think they can wing it. They don't understand one bit about the instrument they are trading.
Also, if you're not good at something, do what you're good at and stick with it. Do what makes you happy and make sure it fits your personality. Trading is part psychology too.
Not everyone is the same. If one person likes something, another person wants something else. Find your talent and master it. Forget the rest.