From Micros to Millions: 2% per day

[Turveyd]

Sorry to disagree.....if you trade only one market and it starts to "flatline", you're not going to make any money. Now if you are trading 4 markets, you have a much better chance that one of them is moving.
Take CL for instance...today straight down.

ES has the odd flat day, NQ on the other hand always have enough movement to make something some days better than others, CL can be very very flat at times if Index's are getting all the interest.

Still ES 1 or 2 days per month when it's dead, generally before a big Fed announcement, you can live with missing target 2 days per month.

 

[syswizard]

The disadvantage with multiple instruments, of course, is occupied screen real estate.

Of course. Trade 4 instruments....then have 4 monitors.

Could I trade just one instrument, MES (best liquidity). Yes. I have. But sometimes one of the others is screaming far ahead up or down. I am going for the "high probability" trade. So I have learned to go with the biggest winner up or biggest loser down.

There are 3 factors at play here:
1) Liquidity - and I think MES, MNQ, ES, NQ, RTY, and CL all have more than adequate liquidity.
Making the decision to trade on the basis of highest liquidity is flawed.
The real criteria should be "Does it have adequate liquidity ?".

2) Instrument Correlation - This is less significant if you are scalping; but could be significant if you are swinging.

3) Movement - Most important and this should be tracked using volatility measures and range calculations.

 

[CALLumbus]

Huh ? If you throw NQ aka "The Beast" into the mix, I doubt seriously that you can also effectively manually manage 3 other positions in 3 other markets.


Well, the experts like champion trader Kevin Davey say it's best to diversify....multiple markets, multiple systems. Jim Simons from Renaissance Technologies also espouses this approach.
https://en.wikipedia.org/wiki/Renaissance_Technologies

That Kevin Davey looks like a joke to me. Did he ever make any money from TRADING ? Champion Trader...

Jim Simons is right for sure in his very own context. As a manager of a billion dollar hedge fund, you cannot just open your platform and start to trade NQ for ticks. He HAS to trade multiple instruments. He cannot apply the same style like a 10,000 USD AMP futures client.

I dont say it is right or wrong, even as a small retail trader, to trade multiple instruments at the same time. I just say, everything is possible. And never assume just because you are not able to do something, that nobody else can do it. There are guys out there who run 100 meters in less than 11 seconds. I can not. There are guys who can bench 600 lbs. I am not one of them. And there are guys who can make excellent money day by day, just trading NQs from their AMP Futures retail account.

 

[syswizard]

That Kevin Davey looks like a joke to me. Did he ever make any money from TRADING ? Champion Trader...

Dude - Do your "due diligence" first before commenting:
https://www.worldcupchampionships.com/world-cup-trading-championship-standings
2006 Kevin Davey 107% Futures

 

[CALLumbus]

Dude - Do your "due diligence" first before commenting:
https://www.worldcupchampionships.com/world-cup-trading-championship-standings
2006 Kevin Davey 107% Futures

After this post, I will not comment more on this Kevin Davey guy, because everything I say in this regard is just speculation.

Everything is possible, and maybe he is really a fantastic trader. But to me, he does not seem like a successful man, at least not in trading.

I have no clue about this trading worldchampionship, but this sounds just superstupid to me. If you are a "champion trader", why you dont just make your millions quiet and in disguise, and then enjoy spending it and just having a fantastic life ? And even if this championship is real... even a broken clock is right twice per day. Having a good performance over such a short period of time does not make a successful trader in my opinion. Everyone can load up on risk and then either be a star or a big loser in such a competition. You have countless trading competitions each day on the internet, and all the time you have some noobs winning with performances like 300% in 2 weeks. There are all their yachts and Ferraris ?

Everything is possible, and maybe he is a fantastic trader. But to me, he seems more like a vendor, trying to get people into his stuff and make money from them. He sells books, he sells his trading systems... if one is such a super trader, can he not make enough money from his own trading ?

I do not call myself a champion trader, I never participated in such "trading championchips". But I am still happy with my performance and can live the life I always wanted, as a result from my trading. I would never want to sell books, courses, my "strategies" or something like that to anybody. So much extra hustle and work for a few extra dollars ? If my trading would not be profitable, then maybe I would consider other ways of making money. But even then I would probably not want to sell saltwater to the thirsty ones.

 

[Laissez Faire]

Sorry to disagree.....if you trade only one market and it starts to "flatline", you're not going to make any money. Now if you are trading 4 markets, you have a much better chance that one of them is moving.
Take CL for instance...today straight down.

In the past - I would have agreed with this. There were periods of time in the past when the markets were moving so slowly that you pretty much would need to diversify and at least track two markets. But these days, any index futures really offer everything you need. And I imagine that ain't going to change in a long time.

At least this is true for my trading style/approach.

 

[virtusa]

Sorry to disagree.....if you trade only one market and it starts to "flatline", you're not going to make any money. Now if you are trading 4 markets, you have a much better chance that one of them is moving.
Take CL for instance...today straight down.

If you have a good system, you will have every day signals in the MES/ES. So no need to diversify.

If you are fully automated you can diversify. If you are not fully automated you will have difficulties to follow 4 market at the same time. You even risk to miss a lot of signals because you have to jump around between the different index futures you follow.

I cannot remember when the ES did not give at least 1 profitable and relevant profitable signal a day. If you have days without any signal your system sucks.

The fact that an index future is on "flatline" does not mean it is a lost day. When an index future gets out of that flatline the moves are in general big. You only know in hindsight if the flatline day was a lost day as you can never predict when the flatline will end and how the market will react.

On october,19 we had in the MES a flatline for 5 hours, so you would switch to another index future because watching the MES would be lost time. After the 5 hours flatline the market went down more than 60 points. You would have missed that one. 60 points is a rather big move.

If you have a good system any index will give you on a yearly basis a very good return. No need to jump around between different index futures.

 

[Snuskpelle]

After this post, I will not comment more on this Kevin Davey guy, because everything I say in this regard is just speculation.

Everything is possible, and maybe he is really a fantastic trader. But to me, he does not seem like a successful man, at least not in trading.

I have no clue about this trading worldchampionship, but this sounds just superstupid to me. If you are a "champion trader", why you dont just make your millions quiet and in disguise, and then enjoy spending it and just having a fantastic life ? And even if this championship is real... even a broken clock is right twice per day. Having a good performance over such a short period of time does not make a successful trader in my opinion. Everyone can load up on risk and then either be a star or a big loser in such a competition. You have countless trading competitions each day on the internet, and all the time you have some noobs winning with performances like 300% in 2 weeks. There are all their yachts and Ferraris ?

Everything is possible, and maybe he is a fantastic trader. But to me, he seems more like a vendor, trying to get people into his stuff and make money from them. He sells books, he sells his trading systems... if one is such a super trader, can he not make enough money from his own trading ?

I do not call myself a champion trader, I never participated in such "trading championchips". But I am still happy with my performance and can live the life I always wanted, as a result from my trading. I would never want to sell books, courses, my "strategies" or something like that to anybody. So much extra hustle and work for a few extra dollars ? If my trading would not be profitable, then maybe I would consider other ways of making money. But even then I would probably not want to sell saltwater to the thirsty ones.

I used to have respect for Davey (his book is an easy to read introduction to many concepts in algo development). A while ago I signed up on his mailing list... which has turned out super sales:y. I assume he made money at least in the past but he spends an awful amount of effort marketing currently. Writing a book once is one thing, marketing near daily is another.

A point in his support is he supposedly uses little leverage in his own normal trading (i.e. not said championship) and thus presumably his account isn't growing that fast, so additional funding would probably be useful to accelerate the growth of his networth.

 

[scalpi]

After this post, I will not comment more on this Kevin Davey guy, because everything I say in this regard is just speculation.

Everything is possible, and maybe he is really a fantastic trader. But to me, he does not seem like a successful man, at least not in trading.

I have no clue about this trading worldchampionship, but this sounds just superstupid to me. If you are a "champion trader", why you dont just make your millions quiet and in disguise, and then enjoy spending it and just having a fantastic life ? And even if this championship is real... even a broken clock is right twice per day. Having a good performance over such a short period of time does not make a successful trader in my opinion. Everyone can load up on risk and then either be a star or a big loser in such a competition. You have countless trading competitions each day on the internet, and all the time you have some noobs winning with performances like 300% in 2 weeks. There are all their yachts and Ferraris ?

Everything is possible, and maybe he is a fantastic trader. But to me, he seems more like a vendor, trying to get people into his stuff and make money from them. He sells books, he sells his trading systems... if one is such a super trader, can he not make enough money from his own trading ?

I do not call myself a champion trader, I never participated in such "trading championchips". But I am still happy with my performance and can live the life I always wanted, as a result from my trading. I would never want to sell books, courses, my "strategies" or something like that to anybody. So much extra hustle and work for a few extra dollars ? If my trading would not be profitable, then maybe I would consider other ways of making money. But even then I would probably not want to sell saltwater to the thirsty ones.

Very good words CALLumbus !!!

It is known that at the Robbins worldchampionship the "professionell" tradercoaches start with many many accounts and they try, that one of it is sucessfull ...... everyone can think which possibilties they have !

And for a scalper (like sstheo, or CALLumbus, or myself) ist is not possible to participate, because they charge an extra 5 USD per halfturn for the competition !

And as CALLumbus (by the way thank you for your warm welcome !) already said, there are some really sucessfull scalpers around, just sitting at home and trade and enjoy life !

sstheo I thank for your work here to show your project ! I think that is vey helpfull for many people here ! Thanks. GO ON !

 

[eternaldelight]

Dude - Do your "due diligence" first before commenting:
https://www.worldcupchampionships.com/world-cup-trading-championship-standings
2006 Kevin Davey 107% Futures

107 percent on 10,000 in a year? That’s about 44.5 dollars a trading day with trading one lots in the NQ (or any futures contract of your choosing). Futures are leveraged so talking about gains in terms of percentages is misleading (it also is for talking about day trading returns on a small account). Even with 1 lots in the ES in a 10,000 account you’re leveraged over 10x (over 20x leveraged in the NQ). Id bet dollars to donuts that CALLumbus could top that performance no problem.

“My first year of manual trading I took that $150K to $50K (broker theft) and on to 800K by the end of the year. I traded almost exclusively illiquid futures contracts at a time when there was absolutely no automation on those contracts. It was a golden era. Still, it's not too different from what I'd expect today. I've generally found that when I hire a new person with no trading experience I should expect them to make about $1K/day using max 25K margin after about 3 months of floundering. Of course everyone can't pull this off. During the interview process I pretty heavily screen for personality traits that I think are important for trading so I end up with people who can resonate with my particular, very risk averse, style.“ -garachen 2013 owner of a real trading company (not trading arcade, traders contribute no capital and pay no desk fees. They make their money trading)

“Strategies you can employ with <$1M vs $100M vs $1B are 100% completely different. Some of the same skills overlap just a little bit. Comparing 'return' from a small trader scalping vs someone doing stat arb with $100M or capital structure arb with $1B is completely meaningless.

....

Outsize 'returns' on small accounts are possible because you are correctly identifying sloppy trading from larger players. Unless you are throwing around 100M+ it doesn't even make sense to measure return.“ - garachen

“Except under very specific circumstances traders don't talk in terms of return. The reason is that until you have lots of capital, $100M or so, your capital and risk are very disconnected.

I've never ever had a trader discuss their profitability in terms of return. It would be a huge tip off that they are hiding something.” - garachen

The best traders do not compete in Robbins World Cup so calling it the the world championships of trading is a joke. Imagine that scenario for any other competitive field. If Kevin Davey’s performance was so impressive why wasn’t he headhunted by the top algorithmic trading firms where he could end up making 7 figures a year with full benefits? Instead he’s selling books and courses. Why? Altruism? Lol no

@Snuskpelle i liked the first paragraph but not the second. Dudes been at this for at least 15 years (probably more like 20) I seriously doubt that’s the reason he’s a salesman (his growth is too slow cause he doesn’t use leverage).