Not realistic unless you are doing HFT.
Is it possible to consistently make $5000 a month trading 2 index futures contracts per trade ?
- Thread starter etradeqeko
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Not realistic unless you are doing HFT.
To be fair, succeeding in trading isn't realistic for most people. See what I just wrote:
"Sadly, it's not a progression most would be traders will ever achieve..."
No that is not possible. It's not the target amount the issue, nor the number of contracts.
The real fallacy is the very idea that one can "make consistently make $anyfigure a month".
Always remember, that for any assigned trading method (no matter what it is) there always exists, at least in principle (but not necessarily in practice, if the capital is sufficiently large, and the trading instrument suitable), a price trajectory which can inflict an arbitrarily large drawdown (or in any case sufficient to "convince" the trader to give up.)
What is possible, instead, is that - over a sufficiently long period of time (usually years) - and with suitable trading methodologies, choice of portfolio and sufficient capital, you can make - on average - a profit of $anyfigure. But not systematically over consecutive periods of time (like days, months ...).
(What you describe is possible only as outcome of trading strategies applied to past data (backtest), which have been "curve fitted" by simulation, and parameter tuning, in search of the best back fitting strategy. An "exercise" probably useful for improving programming skills, but totally useless, and conceptually highly misleading, to make $ in the real world.)
That leaves only the mythical 'unicorn' (super) trader, who has the holy grail method and makes at least 100 ES pts a month with minimal drawdowns. After all 100 pts a month is just 5 points a day.
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It's not that big an ask, it's about keeping it simple though, simpler and simpler the better my results get, pretty much trading YM via M1 and 6sma these days, jump on momo and let it run, bail quickly if the momo dries up.
ES isn't suitable generally, but YM is killing this at the moment, slow rangey markets ofcourse I need to find a market as strong or switch to a range method.
ES isn't suitable generally, but YM is killing this at the moment, slow rangey markets ofcourse I need to find a market as strong or switch to a range method.
Why not? if you know how Wall street traders drive prices. However, if you don't, just forget it. Not a chance.
Wrong. Drawdown depends of leverage, not of frequency of trading.
If I have $25,000 margin per contract traded, a $1,000 loss will be just 4%. If I have a $2,500 margin per contract traded, this same loss will be 40%.
Whether I am doing HFT or not will not change that.
You can have a "not so small drawdown" and still be successful. Or is having a +100% return with a 30% drawdown not successful? Many people would sign for this proposal.
Complete nonsense. I showed the math in posting #99. Even with 1 point a day you can become rich, although it will take some time.
1 point profit per day, $5,000 margin per contract, trading capital $5,000, will give you these profits per month if you reinvest your profits, RT $5 and slippage 1tick in and 1 tick out:
After 12 months it will generate a monthly income of over $26,000 and will increase as long as you reinvest your profits.
After 24 months it will generate a monthly income of over $56,000 and will increase as long as you reinvest your profits.
All this with max 250 contracts. And just 1 point profit per day.
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Very good comments and all I agree with. Drawdown may come at any point in the game.
And curve fitting is an addictive practice, that's why I stop doing it.
Looks great on paper but in reality...most traders need to pay bills, support a family, take vacations, take days off due to personal appointments, get sick or just burn out in which requires time off away from the markets (no trading) to just rejuvenate/re-energize.
The fact is that its human nature to see that amount of money accumulate and then spend some of it (e.g. buy a house/condo, buy a new car, pay off debts, spend money on life luxuries).
Thus, just looks good on paper but in reality...life happens...humans will be humans.
Yet, if someone is able to do that...the frugal types...someone else is paying their bills and/or supporting the trader so that the trader is able to minimize the typical daily pressures a trader will be involved with or they're already rich and can easily afford to try to do such...multiple times as in money to burn.
wrbtrader
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