From 1k to 500k (Deadline: 2017)

[K-Pia]

I am not going to lie to you.
I lost 405$ yesterday. Equity therefore at 548.39$.
Changed my money management as well as entries. Let's see.
I currently stand at -12 points away from my goal. I won't give up.

 

[K-Pia]

WOW, that even worse than paying $4 bucks, so you paying like $6,098 a year on commissions. So you have to make 121% to breakeven on the year with $5k account.

http://www.deepdiscountfutures.com/lowestrates.html

Cost have been taken into account.
Currently I can't spend less on commissions.
I use X_Trader. It's 0.50$ per side. That's how it is.

 

[i am nobody]

So in my opinion, when it comes to trading futures, any idea about growing an account and percentages involved mean absolutely nothing. Its all about how many points you can make on average per trade, how many trades per day, and of course how many contracts you trade. The account needs to have sufficient funds for drawdowns of course, and holding overnight, if that's your thing, but its not so much about growing the account as it is simply maintain the minimum capital required to be able to take the trades.

 

[Handle123]

I saw you reply in a similar fashion to another thread Handle, in terms of the % necessary to breakeven, and I'm not sure if its the best way to look at trading futures.

Simply put, it doesn't matter what percentage you can make on the capital in an account, mostly because I think that it comes down to margin requirements per contract and what your risk:reward is along with how many trades you make.

A person starting out with a 5k account who knows how to trade can trade 1 ES contract, and assuming they make on average 2 points per day, so $100 per day, $500 per week, $2000 per month, and hence about $24,000 per year. If we exclude commissions and slippage, we can say this is 480% gain. But if the trader has $50,000 in the account, but still trades just the 1 contract, the profit of 24k is the same, but now its only a 48% gain.

So in my opinion, when it comes to trading futures, any idea about growing an account and percentages involved mean absolutely nothing. Its all about how many points you can make on average per trade, how many trades per day, and of course how many contracts you trade. The account needs to have sufficient funds for drawdowns of course, and holding overnight, if that's your thing, but its not so much about growing the account as it is simply maintain the minimum capital required to be able to take the trades.

Slippage and commissions of course do add up, and your calculations of that is correct, but once again, when it comes to futures, thinking in terms of a percentage that you need to make on an account balance just seems like an odd way to look at it. If anything, I would say that the $6100 in commissions equals 122 points, so you have to make more than 122 points per year to be profitable if you're going to take this certain number of trades. Saying you need to make 121% is very arbitrary.

I of course know you know this, and of course locking in that 1 tick profit as you say is key, but its just odd to me to see a discussion about percentages when it comes to trading accounts.

Well, I agree with parts of what you said, a GOOD TRADER can trade a $1500 account and eventually make it into a million dollar account, he doesn't care about fees. But let's talk about the trader who is just starting, they have all kinds of false thoughts that $4 buck fee is not going to mean a thing, whereas on every trade you take, win/loss/draw is going to cost $4 bucks plus. Newbies have no clue of what is against them, like giving you a can opener to remove someone's kidney, a skilled surgeon could do it, but 99% percent of us couldn't.

I am glad you wrote "Saying you need to make 121% is very arbitrary." and glad you wrote you need to make 122 points to equate the commissions, it reinforces how much you have to make just to stay even.

I sort of laughed when I saw this "A person starting out with a 5k account who knows how to trade can trade", you know anyone who starting out know how to trade, I want to meet this person....is it you? You actually know someone who has $50k account and doing one lots?

My posts have been directed towards those who are just entering day trading, many have dreams it is a zero sum game and yet the fees alone will hurt you and most won't even know it.

Trade well fellow Texan!!!

 

[Pekelo]

I won't give up.

Sure you will, it has been predicted...

Probably will close after 3 weeks of trading...

 

[tt.texantrader]

Well, I agree with parts of what you said, a GOOD TRADER can trade a $1500 account and eventually make it into a million dollar account, he doesn't care about fees. But let's talk about the trader who is just starting, they have all kinds of false thoughts that $4 buck fee is not going to mean a thing, whereas on every trade you take, win/loss/draw is going to cost $4 bucks plus. Newbies have no clue of what is against them, like giving you a can opener to remove someone's kidney, a skilled surgeon could do it, but 99% percent of us couldn't.

Agree completely.

I sort of laughed when I saw this "A person starting out with a 5k account who knows how to trade can trade", you know anyone who starting out know how to trade, I want to meet this person....is it you? You actually know someone who has $50k account and doing one lots?

I also agree here. A 5k account will be gone in no time if someone is starting out.

My posts have been directed towards those who are just entering day trading, many have dreams it is a zero sum game and yet the fees alone will hurt you and most won't even know it.

Yes, I have seen this myself, painfully so when looking at statements. But I think on the other side of the coin was the metric that you need to make 122% per year just to break even. This seems like a huge and unrealistic number simply because most people are used to thinking interest rates are 3%, a good yearly return is 10%, and so, in comparison, this 122% number is just mind boggling, which it shouldn't be if you really break it down properly.

Many day traders, if they have 50k in their account and transfer out their profits daily, could have percentage gains in 1,000% range. But clearly someone swing trading stocks in a large account would be very happy with 30-40% per year. So I just wanted to highlight that for day trading futures, % gains and losses isn't the best metric to use.

Trade well fellow Texan!!!

And to you sir.

 

[Handle123]

...

Yes, I have seen this myself, painfully so when looking at statements. But I think on the other side of the coin was the metric that you need to make 122% per year just to break even. This seems like a huge and unrealistic number simply because most people are used to thinking interest rates are 3%, a good yearly return is 10%, and so, in comparison, this 122% number is just mind boggling, which it shouldn't be if you really break it down properly.

Many day traders, if they have 50k in their account and transfer out their profits daily, could have percentage gains in 1,000% range. But clearly someone swing trading stocks in a large account would be very happy with 30-40% per year. So I just wanted to highlight that for day trading futures, % gains and losses isn't the best metric to use.



And to you sir.

Well, this is where we will have to agree to disagree. I am a numbers guys and the numbers are saying the obvious to me as far as percentages, one of many reasons why 95% fail at day trading. I certainly not saying someone who wants to try to compete against some of the best not to give it a shot, but it is NOT GOING TO BE EASY, people like me love Bait and we love totally destroying other people's account with gusto, yes sounds rejoicing other people demise to be anti social, but if my words hurts your ears, I hope to stop the ones who think they can read one book over the weekend and think it is easy. I am a ruthless son of a bitch when it comes to day trading and proud to be as others were happy to take my losses.

Newbies that want to trade better be more than ready to compete, better know how to program, and use less of your opinion and more of long nights of back testing, you can skip the parties with the boys, skip vacations, skip knowing your family for a few years. And yet look at people of Wealth, they made it Long Term trading using weekly charts AND less trading, less commissions.

There is huge and I mean HUGE difference between the 1% and the 95%, you are writing about the guys that know how to trade, but take your next door neighbor, fresh account and can do completed trade in one second, BAMM $4.75 for the broker, thank you SIR may I have another? Do you think folks coming into this form of trading is looking to make 3%? They are thinking they will be next Larry Williams cause they are smarter than average bear, yeah I am going to make 15,000%, many have in their minds of the money already spent on boats and cars, and I am thinking their 5k account is in my account within a few months, if there is any left after commissions.

There was a time where I was paying my broker 20k a month and he was making more than me.

 

[tt.texantrader]

And yet look at people of Wealth, they made it Long Term trading using weekly charts AND less trading, less commissions.

I'm not sure that long term trading will work as well for the next 30 years as it did the last 30 years. But this gentleman's journal certainly isn't the place to get into it.

But on the commissions point, I just don't think that commissions is the reason why most people aren't profitable. Yes, I have seen many of my statements from the past where the commissions were just as much, if not more, than the actual losses from points/ticks lost. But I can assure you, even if I paid 1 cent per contract traded vs. $2.03, it would not have made one ounce of difference overall.

At the end of the month, for the guys trading 1 lot and taking several trades a day, losing a few hundred on commissions is inconsequential. Perhaps another way to put this would be that if those commissions really eat into your profit (ie. they are 25% or more of your profit), then you're not far away from going into the deep end from either slippage, or your edge diminishing, or a slight change in psychology, etc., so you're not all that profitable and experienced to begin with.

Now its true that for guys with a system to make 5 ticks profit from a trade, and hence $62.50 for the ES, that $4.06 per round trip (assuming $2.03 for IB rates) is 6% of your wins, so maybe some guys do pay 10-15% of their profits for commissions. The BE +1 tick rule would certainly help here, but once again, this move, although helping to save on commissions, is dependant on an entry where this is possible, and lots of testing as you say, so even doing something like this is for an advanced trader. An advanced trader will benefit from ways to reduce commissions, but the amateur will not because he is losing for so many reasons other than commissions.

 

[K-Pia]

Made 4.15 points net today.
Still have a lot of work to be done.
I'll post the statement tomorrow as usual.
Underperforming by 11 points or 550$.

Found a double hedged sword.
If you buy low and sell high.
You might forget about SL.
Since retracements can ..
Make back your loss..
If wrong and lucky !
Haha ... But It's toxic.

You can't trick the market forever.

 

[Handle123]

I'm not sure that long term trading will work as well for the next 30 years as it did the last 30 years. But this gentleman's journal certainly isn't the place to get into it.

But on the commissions point, I just don't think that commissions is the reason why most people aren't profitable. Yes, I have seen many of my statements from the past where the commissions were just as much, if not more, than the actual losses from points/ticks lost. But I can assure you, even if I paid 1 cent per contract traded vs. $2.03, it would not have made one ounce of difference overall.

At the end of the month, for the guys trading 1 lot and taking several trades a day, losing a few hundred on commissions is inconsequential. Perhaps another way to put this would be that if those commissions really eat into your profit (ie. they are 25% or more of your profit), then you're not far away from going into the deep end from either slippage, or your edge diminishing, or a slight change in psychology, etc., so you're not all that profitable and experienced to begin with.

Now its true that for guys with a system to make 5 ticks profit from a trade, and hence $62.50 for the ES, that $4.06 per round trip (assuming $2.03 for IB rates) is 6% of your wins, so maybe some guys do pay 10-15% of their profits for commissions. The BE +1 tick rule would certainly help here, but once again, this move, although helping to save on commissions, is dependant on an entry where this is possible, and lots of testing as you say, so even doing something like this is for an advanced trader. An advanced trader will benefit from ways to reduce commissions, but the amateur will not because he is losing for so many reasons other than commissions.

I never said commissions were main reason newbies lose, but it is certainly one of the reasons that adds to them losing faster. Many believe more is better as we often taught more is better, but not the case in trading, more knowledge is better, more back testing is better. In my own trading, plus one tick was my edge, I was paying $25 bucks for commissions. It was the cost of one tick. Cause I scalp, my bottom line is anywhere from $12.50 to $62.50 per lot based on weekly stats, over half my trades are plus one tick, I have low losing percentages. But the newbie who starts in trading, more trades not better as he sides on lack of knowledge, energy to trade-takes time to work up on being focused for long periods, nervousness really cuts into body and just plainly loses focus, they overtrade and even if they get to breakeven, they lost.
I know by getting that one tick on breakeven trades, I will come out ahead as my fees are paid even if I was paying retail.

Newbies lose more often cause of lack of discipline, they trade more and often for non system trades, adds to bottom line of loss of money.

Time to make dinner.