Do daytraders profit everyday? Or are they like me: one huge win one day, 10 losses in a row after?

[Xela]

loads of youtube traders seem to make like at least 2k every single day without fail. But they also run chat rooms.

"Seem" is the operative word, there.

 

[zdreg]

it’s not trading that is hurting you, it’s your own expectations.

"from your mouth to god's ear."
it’s not .......... that is hurting you, it’s your own expectations.
fill in the box. you hit on one of the great truths of life.

 

[Handle123]

I know this is a post about day trading.

The "80/20" rule applies to trading.

80% of your profits come from 20% of your trades.

80% of your profits will come from 20% of your time. Rest of the time, it's a grind.

80% of your losses will also come from 20% of your trades/time. Which is why traders should be ever vigilant about preserving capital.

As far as my long term in commodities, this is very true statements, but in actually it is lower than 20%, more like between 5-15%. When I did it manually, you really appreciate what you can do in scalping Indexes cause my long term, it like constant of breakeven or small wins/losses for much of the time in months and sometimes even years in some markets.

What is more important than win rate is positive expectancy. If you have high positive expectancy, one win out of 10 should not bother you.

What fascinates me is trading strategy like Nassim Taleb's, have one winning trade every now and then but still makes millions. But I don't know how many trade that way. You need to have ice in your blood to survive such odds.

No you don't, but you have to study and define risk management, you stop competing against Hedge funds and make it a self competition, you become highly knowledgeable on hedging and not just options, sometimes you have to use stock options or stocks themselves to hedge various commodities as they lack options. Like I got short Lumber and waiting to add to my shorts, without the hedges it be playing with fire.

And yes, I agree with positive expectancy, but mine is way different than most, I have zero caring about winning percentages and just concentrate on finding ways to have as low as I can go regarding losing percentages and amount of drawdowns.
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Humans have a tendency to want to be right. It makes them feel good and gives them something to brag about at parties. The last thing a trader with a 10% win rate wants to do is talk about his last 9 losses.

But a 10% win rate doesn’t necessarily mean a bad strategy, indeed it could be optimal for the market and strategy where its employed...

I lost feelings a LONG time ago, and it not about being right, it is about how to seldom lose money in LONG TERM and degree scalping/day trading. I don't go to many parties and most people would see me as part of the staff for the party, LOL And the 9 "losses" don't have to be losses, but they not winners either, some you make peanut money, for the trades where you lose peanut money. Sometimes Long term you have to take 24 different signals and last one is the huge winner/add on another 15 trades for ride down or sometimes can be several years of peanut money like Eurodollars. But I do attend some parties and I love discussing my 6% wins some years in commodity trading, but people assume it is 94% losses, and peanut money is usually fees or less than $50 and for long term trading, people buy fancy drinks and pay more than that each week. And my losing percentages(more than $50) are usually close to my winning percentages, and the risk to reward is very difficult to compute and I won't go into more than that, but some trades do have zero possibility to lose, and I am exploring this much more as I have time. Worst was 23 non fully winning trades, 24th paid off. Scalping/day trading, no one would believe what can be done when you live trading systems, and not going to be baited, stopped caring about most people long ago.

... If I am too stupid to make more then 10% winning trades, how can I then be smart enough to make killings in the profitable ones? ...

I thoroughly enjoy your responses, you are one of few I look forward to read, @Xela as well and a dozen others.

Yes, am too stupid, but also as stupid to make less than 10% losses, LOL. Made my day on this one.

That actually can lead into a profitable strategy by reversing the entries signals...

Have spent much time trying to make this work and all became too much losing percentages I can endure.

Wrong. If you do several trades a day you don't have to be 100% sure. You can recover a loss in another trade the same day. Total profits of the day should be bigger then total losses of the day. That's all.

1. Trading for the bigger moves implies that sometimes you give back a smaller profit and turn it in a loss because you want the big moves, but the big move does not occur.
2. Trading the big moves is more difficult then making small profits.
3. The number of winning trades is higher when trading for small profits.

Because of these 3 things I noticed, my strategy is a follows:

• I go for the big moves. That's where the real money is made.
  
• If I take a loss I switch to the small moves till my loss is recovered.
• Because my number of winning trades while trading for small profits is much higher, my risk is lower and I recover easily my losses. But in several, smaller profits.
  
• If I would continue to trade the big moves and get hit with a second (consecutive) loss, it becomes much more difficult to recover.

In this way I normally recover all losses within the same trading session, so ending without a losing day. Over 80% of my winning trades are big moves; less then 20% are the "smaller recovery from a loss" moves.

My lonely day trading system has similar numbers, seldom get full losses, most losses occur on reversals and those are seldom as well, only took me over 3 decades to design a method I could endure. Half my automation are scalping systems of small profits, and as day progresses, less volume, but when you follow many instruments, really hard to have losing day cause of diversification, only problem is running out of capital allotments and this is where losing days come. If there are three full losses and since all systems average down, if happens in in trading Indexes or Financials, losses be larger and strict rules on percentage of allotment will not allow to over ride, will get 1-6 weeks to recover in that instruments. If never use averaging down technique, be very hard to have losing days, but where would be the fun in that?

Many others and I completely agree with these views you've mentioned.

Yet, I think when traders do talk about how they're trading...they're intentionally vague or they leave out a lot of critical variables...they really aren't revealing any secrets. There's some aspects of trading that must be learned by yourself via trial n error.

For example, many years I've seen popular members share their trade strategy (general info) but they don't mention a criticals element in their trading like "money managment" or "risk management". Another example, a successful scalper talks about how he uses order flow in his DOM but he/she just vague about it...no meat in the burger.

Thus, I think being vague is intentional.

Yeah, I never really understood why some think they need to be at the computer screen every second of the trading day. They should know why their trading instruments tend to be the most active...this is when that lone boring trading job allows you to do other things during the trading day that another job wouldn't allow you to do.

Trading should be part of your life...it should never be "your life". This will minimize putting yourself in the position that trading can ruin your life when things go wrong. Also, it will minimize burn out.

wrbtrader

You of all people should know why. Ninety percentage who come to this forum and others are retail and most never understand or in small parts components , or dollar amounts I make are so small they would lose, hedge funds don't concern me cause most would never say my style matches what they are doing, vendors are very interested as they will sell one copy and before long it on the Internet and large traders would fully understand and then much harder to compete. You want meat? Put in sixteen hours a day for a decade, oh wait, you have other things to do in your life, so did I and I decide to work hard and smart, find very talented people to do what you don't like doing.

I been in the Business since Carter was President, long term, never have meet one trader over ten years with winning percentages for short term to be under 40%, all crashed and burned eventually.

I don't understand much about life but have lived it to the hilt, people tell me. What is normal to most of you, I rely on probabilities on how to respond whether in person or here. Recently have a name for what I have is Asperger's Syndrome. I have no concept of money nor time nor love, but when I hear USA National Anthem-tears form for comrades that have died in line of duty, I will never walk away from trading till I am satisfied of losing gets as close to zero as possible. And have no wife nor can have kids, am a freak of nature. But I do like the man I have become.

Wish all to have a profitable day.
Off for more testing.

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[Scataphagos]

As far as my long term in commodities, this is very true statements, but in actually it is lower than 20%, more like between 5-15%.

I don't know the exact percentage...80/20 sounds reasonable... but what usually happens is that when you catch a good "pop"... maybe 5x or more of your usual profit... it occurs (1) infrequently, and (2) quickly in time. The rest of the time you're "in the grind" hoping to be there for the pops.

A good trader is one who (1) accumulates decent gains during "grind-out*" times, (2) catches some bigger moves occasionally, and (3) protects capital at all times. (Excusing a 50% drawdown for any rationale is not protecting capital.)

*What is "grind-out"? You make enough profit so that you feel it alone was worth the effort you made without catching lots of big winners.... we all want/hope to do that. Doesn't mean we will.

 

[jinxu]

I don't understand much about life but have lived it to the hilt, people tell me. What is normal to most of you, I rely on probabilities on how to respond whether in person or here. Recently have a name for what I have is Asperger's Syndrome. I have no concept of money nor time nor love, but when I hear USA National Anthem-tears form for comrades that have died in line of duty, I will never walk away from trading till I am satisfied of losing gets as close to zero as possible. And have no wife nor can have kids, am a freak of nature. But I do like the man I have become.

I was rewatching Star Trek on Hulu the other day. Then I had a thought that vulcan sounds like asperger's. So I looked it up. Turns out I was write. Now when I think of Asperger's I think of Vulcans.

What do Vulcans & aspergers have in common? we hide our emotions
I have been analyzing star trek and realized my relationship with the vulcans. We think the same way. When you have Aspergers you hide your emotions, because that is the logical thing to do. We do this until our emotions over come our logic like what happens to vulcans exposed to terrelium-d. Now a lot of people reading this may not know what this blog usually is about. It is about people with aspergers, the closest real living beings to vulcans. We think like them, we don’t understand others who don’t think like a Vulcan. We don’t choose to think like vulcans, as lady gaga says “we were born this way”. Aspergers is a form of autism, a very, very high form of autism. I am having trouble thinking of a fictional species who act like they have autism. I believe there was a book called cats have autism, which is somewhat accurate. People with aspergers are on the same chart as those with autism, but function in day to day activity very well. We have acted like vulcans long before vulcans were invented. Our logic may not be the same as your logic, because ours is so logical and yours usually isn’t. Most people mix emotions with logic creating illogical logic. Logic and emotions are separate from each other. Those with Aspergers do a good job of acting Vulcan and hiding emotions until we still act Vulcan, but a Vulcan who can’t suppress their emotions. If you’ve ever seen the newest star trek movie where the Vulcan home world was
Destroyed and Kirk has to taunt Spock to show his emotions, well that is the strongest amount of emotions I’ve ever seen from a Vulcan, and people with aspergers don’t show emotions to that degree, well, some may, but not i. Please understand that everyone expresses emotions differently, so this may not apply to all with aspergers, but this is the best explanation between fiction and reality I could think of. We are Vulcan, we are aspies!

 

[Xela]

Now when I think of Asperger's I think of Vulcans.

This is certainly fairly appropriate for some Aspies.

I'm not sure of the extent to which it's an accurate generalization, though: the reality is probably more that there are almost as many "Aspie personality-types" as there are Aspies (and I've certainly seen Professor Baron-Cohen - widely regarded as the "world expert" - saying something very like that).

 

[snowman80]

loads of youtube traders seem to make like at least 2k every single day without fail. But they also run chat rooms. I never know what to believe, lol
That must be an actual dream job if it's legit!

i think most of these chat room operators make money by herding followers into pre-selected thinly traded stocks and then dumping all over them as soon as a they( the promoters) show a profit and/or by collecting subscription fees.

 

[galvinlee888]

To the point the one huge win in that day covers the 10 small losses on the 10 other days? It's frustrating not knowing when income is coming in. Is it possible to make it more consistent without scalping: 70% winning days in the calendar year? Mine feels like 30% winning days yet I'm still up for the year

Depend on the risk/reward of your trades.

 

[qxr1011]

The problem for most traders isn't the win rate - I've posted a chart on another thread showing that traders win more often than they lose, the problem is the size of their losses is much higher than their wins.

win rate, loss rate, expectations,...

lets rephrase it:

the problem for most trader's - they have no working method

nada...

 

[wrbtrader]

...I don't understand much about life but have lived it to the hilt, people tell me. What is normal to most of you, I rely on probabilities on how to respond whether in person or here. Recently have a name for what I have is Asperger's Syndrome. I have no concept of money nor time nor love, but when I hear USA National Anthem-tears form for comrades that have died in line of duty, I will never walk away from trading till I am satisfied of losing gets as close to zero as possible. And have no wife nor can have kids, am a freak of nature. But I do like the man I have become.

Wish all to have a profitable day.
Off for more testing.

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Wish you good trading too and thanks for the reply.

wrbtrader