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Grinding it out, day after day
- Thread starter lescor
- Start date
Lescor, do you ever feel that your trading firm might start reverse-engineering you systems? Say you and only 5 other guys there are consistently profitable... doesn't it bother you that your records are kept by your firm, and they can get "inside" your head by reviewing your trades? I am assuming you are only being cheap commissions, and leverage through EchoTrade - i.e., NOT a direct hire trading soley their capital. If you WERE trading their capital then it doesn't matter if they know your strategy, but if they are only fascilitating your trading then perhaps you'd be concerned?
I don't even know why I brought this up. Just curious I suppose.
Thanks!
I don't even know why I brought this up. Just curious I suppose.
Thanks!
Quote from lescor:
A lot of what I do is liquidity sensitive and I do not want to invite people to try to reverse engineer my systems and then compete with me for fills.
It's not something I lose any sleep over. If someone wanted to do that they'd have to be a high level person in the firm and then they'd have to dedicate a lot of time, either them or another employee to figure things out, write code, connect to the api, etc. And since I run multiple strategies at the same time, I think it would be pretty confusing to someone who could only work off a list of orders and fills.
I know a few of the people that run the firm and I believe Echo to be highly ethical. They are extremely serious about all forms of compliance and rule-following. Seems like a really bad risk-reward proposition on their part. It's just something that is so far down on my list of worries that I don't even think about it.
I know a few of the people that run the firm and I believe Echo to be highly ethical. They are extremely serious about all forms of compliance and rule-following. Seems like a really bad risk-reward proposition on their part. It's just something that is so far down on my list of worries that I don't even think about it.
Good points. I suspected something similar. I did have a theory about something though. Wonder if you can shed some light on it? That some of the big banks and hedge funds probablly go about asking such prop shops about anonymous info on their most profitable traders - i.e., just first name. And then send in spy-like headhunters to recruit them. I could be way off on this, but have you - or any other successful traders you have known - ever been approached for hire out of the blue? Thanks.
Quote from lescor:
It's not something I lose any sleep over.
Quote from abc123:
I did have a theory about something though. Wonder if you can shed some light on it? That some of the big banks and hedge funds probablly go about asking such prop shops about anonymous info on their most profitable traders
This is something I've been thinking about too. Usually they say that big banks and hedge funds are not interested in strategies lescor is employing because of illiquid instruments he's trading and inability of these hedge funds to invest their enormous capitals without wrecking the whole strategy of lescor. Hence lescor's niche.
At the same time, it seems probable that those funds can discover what lescor is doing exactly either by reverse engineering or by reinventing the same, or because it's not a big secret, whatever. Point is that they are not interested because capital they have to use is much bigger than lescor's and is not going to work if applied fully.
What I don't understand then, why they don't set up a department of 2 people: lescor2 and lescor3, who will be trading with a fraction of that hedge fund capital, get fantastic profits, pay their salary and even better cars of hedge fund management. If you understand my point.
boba15, I completely agree. As a matter of fact, I was attempting to make the exact same point. I get the feeling that this DOES happen - i.e., hedge fund A opens up a junior fund that employs such traders. GoldmanSachs alone had several hedge funds of its own... what's not to say that they don't have funds of funds... even after recently shutting down their prop desk.
Quote from boba15:
What I don't understand then, why they don't set up a department of 2 people: lescor2 and lescor3, who will be trading with a fraction of that hedge fund capital, get fantastic profits, pay their salary and even better cars of hedge fund management.
Best week since early July, +15k. Not particularly busy, as usual, but nothing BAD happened and I caught a few good trades here and there. Daily pl was +1.5, -1.5, +5, +5, +5. Traded 301,000 shares.
For the entire month of September: +$23,000 gross on 1.68M shares volume. 12 profitable days, 9 losing days. Best day was the 16th, +11k, worst was the 21st at -6. Best strategy for the month was actually my swing trades (+12k). I'm very pleased about that. I expect this swing system to break even when the market chops, and make money when it trends. Since September was straight up, the expected result was achieved, so yay for a plan working.
However overall the month was disappointing. 20k is the bottom of the barrel level I want to make and about half of what I historically average. Worse than that though is that it's the fourth crappy month in a row. Granted they were summer months, but this summer was terrible even by summer standards.
Looking at the glass half full though, this is all just coiling the spring tighter for when something finally does blow the lid off. Fireworks will appear again. Until then, it's just grind, grind, grind.
For the entire month of September: +$23,000 gross on 1.68M shares volume. 12 profitable days, 9 losing days. Best day was the 16th, +11k, worst was the 21st at -6. Best strategy for the month was actually my swing trades (+12k). I'm very pleased about that. I expect this swing system to break even when the market chops, and make money when it trends. Since September was straight up, the expected result was achieved, so yay for a plan working.
However overall the month was disappointing. 20k is the bottom of the barrel level I want to make and about half of what I historically average. Worse than that though is that it's the fourth crappy month in a row. Granted they were summer months, but this summer was terrible even by summer standards.
Looking at the glass half full though, this is all just coiling the spring tighter for when something finally does blow the lid off. Fireworks will appear again. Until then, it's just grind, grind, grind.
btw, system #2 I am using is also a swing trading style. system #1 is Elliott. System #2 is a self-developed breakout system gives me more signals than system #1, but it generate false signals obviously (as many breakout type systems generate false signals) but when it does hit a winner it makes a TONN of money. I don't use any technical indicators.