Exit methods for trend-traders

[kubilai]

hehe, 5yrtrader must be a little confused because 100% per month starting at $1k comes out to be $4M/year.

I do wonder about your strategy spike, at $1k margin per ES contract, that's about 50x leverage you're using. So you must be using a very tight stop, but it's hard to achieve 90% win ratio with a tight stop. Does that mean your system have impeccable timing? Can you tell us what your stop is? Do you always load your positions to 50x leverage?

 

[kubilai]

spike500,

I started reading your previous posts, and learned that your stop is only 2 points. That's 10% risk per trade, without overnight risk that's very acceptable in my mind because of your high % of wins. There are some real gems of wisdom in your old posts, thank you for sharing...

 

[PitchBlack]

Quote from 5yrtrader:

Thats not how it works, unless you only use $1000 to trade and if your system shows that it is right 90% of the time I find it very hard to believe that you are trend-following or you just have a very loose veiw on what right means. With those #'s you must be selling out of the money options.
5yr

There are many trends; all depends in which timeframe you look. A 5 minute chart can give a short trend while the same quotes are in a long trend on hourly charts. On top of that: it's not because you are not able to see the trend, that the trend isn't there. You clearly never ever traded futures: talking about out of the money options? Telling me to crank up the leverage? You apparently have no idea about the leverage i use.

Quote from 5yrtrader:

With those #'s you must be selling out of the money options. If you have that good of results why wouldn't you crank up the leverage and actually make some really money, $12,000/year isn't what most people get into trading for, I think you can make more working the drive thru window.

5yr

Kubilai already commented on your terrible calculations. I think it's more a job for you to work the drive thru window. Although i think they require you to have a minimum knowledge of basic maths.

 

[PitchBlack]

It's only a pity that these kinds of posting get hostile reactions from certain people. I'm glad they are of some use to you.
My stop is indeed 2 points and is based on a risk/reward study on my +1000 trades test. I know within a very small margin the outcome if i do 100 trades because of stats.

Quote from kubilai:

spike500,

I started reading your previous posts, and learned that your stop is only 2 points. That's 10% risk per trade, without overnight risk that's very acceptable in my mind because of your high % of wins. There are some real gems of wisdom in your old posts, thank you for sharing...

 

[PitchBlack]

Quote from 5yrtrader:

So are you saying that upon entering your trade a point 1, which to me looks like you should be buying but you get short, you have stastical proof that bottoms are reached at ~10:18am?

At point 4 there is no obvious trend, it is still trading right around the opening, 1 bar to the right of point 5 seems like a more likely enter point. Obvious shortterm trend down and has broken through the low for the day.

At point 4 in MY system there is a trend. How can you tell me what my systems says if you even haven't the slightest idea how it functions? I call this arrogance.

Quote from 5yrtrader:


I believe it is impossible to identify trends before they happen, its like saying the market will move to X price in X days, no one that says that knows WTF they are talking about, you can guess but thats all it is.

Trend-following is a non-predictive strategy, it follows trends it doesn't try to guess before hand, they are usually late to parties too.

[/B][/QUOTE]

I add athe bottom of this posting a posting from a few days ago. I asked Lefty if it was not better to get out of his short position at 6.06 hours. I specified it should be done in the next 30 minutes. I placed a blue arrow on the added chart at 6.06. You can see yourselve what happened AFTERWARDS. So i posted IN ADVANCE, something that it impossible according to you. We went up and you could easily take 4 points or 20% on your investment. You have not the slightest idea what is possible in trading.

Quote from 5yrtrader:


Trend-following is a non-predictive strategy, it follows trends it doesn't try to guess before hand, they are usually late to parties too. On your chart, a trendfollower would have been long at 1, short on that big down move between 1 and 2 and finally short a bar or 2 after 5, losing money on the first 2 trades and making it back on the last one.

[/B][/QUOTE]

This quote is the best of all. You are going to tell me what i should have had done as a trendfollower. For you it's even clear that i should have lost twice and won once. In the end i should have a break even day. Well, don't take your wishes for reality.

 

[PitchBlack]

5 yrtrader,

I will decide myself if, when and how i respond to questions of other posters.
So i'm not interested in giving you signals in other markets nor will i give signals in the ES.
I'm free to decide how far i will go.
The fact that you will probably see this as proof that what i tell is not true is irrelevant to me.

I don't feel the need to prove myself, i only wanted to share a part of my vision on trading and a part of my 15 year long experience as daytrader.
For you it probably has no value because you think you know all there is to know. Apparently you even know how far the knowledge of other people can go. The fact that you don't even know these people poses no problem for your judgement.

You still have a lot to learn; and not only in trading.

 

[bali_survivor]

Quote from spike500:

I trade the ES with 1000$ margin per contract. I make more than 20 points net a month. 20 points is 1000$ or 100%. The real power lies in the fact that i have normally +90% profitable trades. So i don't give much back to the market from what i earn.

03-30-05 05:46 PM Quote from spike500:

My win/loss ratio never was low, but when i lost , i really lost.
But that's over since 1994 ( after a huge loss). I now respect my stoploss .
At least 85% of my trades are profitable.
Average hold time depends on the trend. If there is a move of 3 hours i stay in three hours, if the move is from opening till close, then i stay in from opening till close. I normally do 1-3 trades a day. I think (but i never calculated ) my average profit per trade is between 3 and 4 points.

From all the profits i make i give back between 10 and 15%. My stoploss is always at 2 points.

05-12-05 01:06 AM Quote from spike500:

I always take the full position. I trade on a signal, when the signal is there I get in.

I move my stop not after x ticks but based on calculations from my system. As long as my system says that we ‘re in the right direction I stay in, when the system warns me that the position might be in danger because things don’t go exactly as planned, I place a stop on the entry. My system warns very fast which means that in practice I can almost always get out before losing money. But there is always a stop on 2 points (ES).

Frequency of trading is irrelevant to me. If I have 1 signal I trade once; if I have 5 signals I trade 5 times. The signals tell me how many trades to do. If you have a good system you must respect the rules of that system and forget everything else.

Hmmmmmm..........

Let's say:
20 trading days / month
average 2 trades a day
minimum 3 points profit on winning trades
85% winners

which will give

20 (days) * 2 (trades) * 0.85 (% winners) * 3 (points) = 102 points gross profit. (conservative)

Now:
stop loss 2 points (yet at times you move it to break even)

20 (days) * 2 (trades) * 0.15 (% loosers) * 2 (points stoploss) = 12 points gross loss. (worst case)

Which makes 102 - 12 = 90 points net profit....

yet YOU mention 20 points net per month????

WTF ????

What am I missing here?


Something is not adding up!

Are we having another Woodie or ProfLogic here?

 

[PitchBlack]

Quote from bali_survivor:





Hmmmmmm..........

Let's say:
20 trading days / month
average 2 trades a day
minimum 3 points profit on winning trades
85% winners

which will give

20 (days) * 2 (trades) * 0.85 (% winners) * 3 (points) = 102 points gross profit. (conservative)

Now:
stop loss 2 points (yet at times you move it to break even)

20 (days) * 2 (trades) * 0.15 (% loosers) * 2 (points stoploss) = 12 points gross loss. (worst case)

Which makes 102 - 12 = 90 points net profit....

yet YOU mention 20 points net per month????

WTF ????

What am I missing here?


Something is not adding up!

Are we having another Woodie or ProfLogic here? [/B]

First of all the calculation you made is based on guessing, not on what i told. I said: " I make more than 20 points net a month. "
To someone who is no prejudiced this should mean AFTER LOSSES, that's why i use the word "NET".
Apparently you are so busy trying to put the stamp "Woodie" or "Proflogic " on me that you only read what you would like to read.
I only mentioned 20 points net because even with 20 points net i knew i would get your kind of reaction. In reality i make more.
Only in the move i posted to Lefty on this tread i made in 1 trade already more than the 3 points you are suggesting. But 1 trade is not a good reference. You need at least 100 trade before you can judge a system.
Unfortunately i don't have the intention to post 100 trades; i will give in the next posting an explanation of what would have happened last friday. After that i will do like Proflogic, i will stop posting and leave the forum to the "experts" who try by guessing, manipulating calculations at their convenience and quoting only parts of posting at their convenience to ridiculise other posters.
I don't know much about trading, and i might be an idiot or whatever you think i am; but i'm sure that my knowledge about trading is at a level where the average visitor of Elitetrader can learn more from me than i can learn from them.

Spike or
Proflogic the second or
Woodie the second

( you can choose a name at your convenience)

 

[PitchBlack]

This is a sample of 1 complete trading day (05/13/2005) just to give the full picture of how it works.
As said before I have 8 degrees of trend. I call them from +4 to –4, where +4 is very strong long and –4 is very strong short.

At the opening the trend is –1, so weak short. The system tells me to go short but to be careful (in fact I’m always careful, because you never know). I know at what to look because I have an certain scenario that should be followed; in this scenario I know that 15 minutes before the bottom I will be able to give the moment where the signal to go long should be. This moment can vary because at the moment of the signal I try to optimise the entry/exit point.
At 9.15 I get the signal that we should go long probably at 9.30 because that should be the bottom. At 9.30 I have to wait because this is not the best point to trade (I see this in my entry/exit system). At 9.39 I have to go long.
In the meantime time the trend has become –2.
I again have another scenario to follow. At 10.30 I get in the zone where the sell signal will be generated; only 1 part of my system is not OK, so I wait till my system says OK for all the parts of the scenario. At 11.30 I get the signal to go short again; the entry/exit timing system tells me that the signal was at 11.27. But because the scenario told me to wait till 11.30 I couldn’t go short at 11.27. So short at 11.30 again following the corresponding scenario. While waiting for the scenario to develop itself the trend goes from –2 to –4. Therefore we have to take the corresponding scenario.
At 14.42 we get out of our position and are flat.

There are priorities in the rules:
First follow the trend
Second follow the corresponding scenario
Third follow the entry/exit system

So if the entry/exit system says to go long but the scenario is still short, you MUST wait till the scenario is OK. The same logic for the trend and the scenario: trend must be OK before the scenario can be executed.

Because some posters react with lots of imagination on what I post or say, i say already in advance: Friday was not a representative day for the average trading day. But Friday was what it was, and I don’t want to manipulate the results, not in my advantage, but also not in my disadvantage. Friday was what it was.

I don’t sell advice, I don’t have a fund you can invest in, I don’t publish a newsletter and I don’t have a website you can enter if you register and pay. In short: I only trade for myself and have no income from any other kind of activities related to trading or invest in any interpretable way. So I’m not posting to attract money.

As I won’t post anymore some posters will have to find another victim to demolish. One can be critical but you always have to stay correct. Discussions and differences in opinions can lead to a better knowledge. But the way certain posters act will guarantee that the level of knowledge will stay what it was, they block any potential improvement because they think they have all the knowledge. And they want that the knowledge of others will be limited to the level of knowledge they have themselves. This can be caused by arrogance or by jalousie.

 

[bali_survivor]

Quote from spike500:

First of all the calculation you made is based on guessing, not on what i told. I said: " I make more than 20 points net a month. "
To someone who is no prejudiced this should mean AFTER LOSSES, that's why i use the word "NET".
Apparently you are so busy trying to put the stamp "Woodie" or "Proflogic " on me that you only read what you would like to read.
I only mentioned 20 points net because even with 20 points net i knew i would get your kind of reaction. In reality i make more.
Only in the move i posted to Lefty on this tread i made in 1 trade already more than the 3 points you are suggesting. But 1 trade is not a good reference. You need at least 100 trade before you can judge a system.
Unfortunately i don't have the intention to post 100 trades; i will give in the next posting an explanation of what would have happened last friday. After that i will do like Proflogic, i will stop posting and leave the forum to the "experts" who try by guessing, manipulating calculations at their convenience and quoting only parts of posting at their convenience to ridiculise other posters.
I don't know much about trading, and i might be an idiot or whatever you think i am; but i'm sure that my knowledge about trading is at a level where the average visitor of Elitetrader can learn more from me than i can learn from them.

Spike or
Proflogic the second or
Woodie the second

( you can choose a name at your convenience)

I just asked a question based on the simple fact:

that the arithmetic based on your infromation does not add up to the net results

This discrepancy is the cause that one has to put in big question marks the rest of your story.

20 points per month on USD $1000,- margin (as you mentioned before) is 100% return per month uncompounded.

Now you mention it is more. The calculation I did before ( based on the information that you posted) shows that it would be 90% return per week uncompounded.

The average reader here on ET is competent enough to make their own conclusions.

No need to reply, for me the discussion is closed.