Lucias vs. Baggerlord

[Lucias]

***** Note from Baron ****

The posts in this thread is just a bunch of off-topic back-and-forth bullshit that was split from a Q & A thread with one of our sponsors, which is why this is now in the chit chat forum.

Michael, some prop firms were known/suspected of recording trades for quantitative analysis on the backend.

#1
Are you willing to confirm that you don't record all trades placed in the live accounts or combine into a database for your own quantitative analysis (beyond assisting traders with reports and data for their own analysis) or resell for the purposes of developing/running automated trading systems and that you will not in the future (at least without making a very public announcement)?

And, #2 are you willing to confirm that you don't clone traders or overload them in secondary accounts for additional profits?

Thanks.

 

[Lucias]

Michael,
Look foward to you answering my last 2 questions there. I've evaluated your program back and forth and trying to find a way that it makes sense to me but I just can't make the numbers work. Everything adds up in my mind that the program is designed to make money from the combines and not to find talented traders.

If you are really interested in finding talented traders, like myself, then I'm going to offer you some suggestions on how to improve your program. Basically, Im going to list the gotchas that make me unlikely to take your program.

1. The 10 and 20 day limits.

This is a really strange way to compare traders in my mind. I mean its strange to me if I'm thinking of myself as a scout and its strange as me thinking as a recruit.

Let me explain why... if I'm scouting for a trader, I want to give the trader as much chance as possible to trade to show me what he's got. So why would I limit that -- unless I wanted to generate combine fees? I simply wouldn't. Why would I not allow my traders to generate more data for me? Why not give them more chances to fail?

It just doesn't add up. It makes me think the program is a joke.

My suggestion: give the trader 60-90 days to trade. Let them trade as much as they want but require them to trade at least say 50%-60% of the days. Require a minimum number of trades.

Why it benefits both parties:
It gives the scouting agency more data to evaluate the performance of the trader and it gives the recruit more opportunity to recover from a random bad start. It gives you more data in general which is going to be useful. It is win-win.

#2. The performance objectives are too high and stated in a wrong way.

The performance objectives are too high. I would fund anyone who hit those performance objectives for 6 months in a row and I wouldn't require them to pay me a dime for it! And, I'm looking for capital. Does that make any sense that a trader looking for capital would be willing to fund traders at a level higher then a FIRM that claims to back traders?

It makes more sense to restate your objectives in terms of reward/risk ratios. A good metric:

Return at least 5x the max peak to valley drawdown and 6x daily the loss limit while not exceeding 6x the daily loss limit.

This type of metric summarizes everything important! Then you need to give a reasonable amount of time to hit an objective like this... 2-4 months.

#3 The funding levels are highly misleading.

At the lowest tier funding, you claim to fund traders with a 30k account. Okay.. most traders would be willing to risk about 30% of thier account for an aggressive strategy...

30%
30k*.30 = $9000

25% risk
30k%.25 = $7500

But how much do you actually give them before sending back to combine? 1k!!! 1k.

Let's do the math another way... the trader has 1k they can lose before going back to combine. Most traders wouldn't want to risk more then about 10% of their total capital. This is a very high.

2% risk
.02*1000 = $20

5% risk
.05*1000 = $50

10% risk
.10*1000 = $100

The implication are obvious. You should drop the daily loss limit on your lowest program to about $120 instead of the $500 it is currently set at or you should increase the risk cap to a minimum of $3,000 (6x the daily risk cap).

#4 Who's more serious.. a trader making real money in live markets or a trader willing to put up a few hundred bucks?

If you are serious about finding talented traders then you should make an exception and waive the combine fees for traders who have made profits in the recent markets.. say last 6 months to 1 year.

You claim the combine fees is just to show seriousness (at one point you claimed this). Well, a trader who risks own money in live markets and is profitable shows way more seriousness then someone who's willing to just throw down $100 to play a game.

So why not give the exemption? Why charge a trader who is already making money in live markets? At least you should give a significant discount or only charge costs.

---

To restate, and probably against my better judgement.. I'm willing to try your free offer but only under Ninjatrader platform or a DOM that matches my OEC platform.

 

[Maverick74]

Lucias, they have 24 live traders right now. What they are doing is working. They are not going to change it because you are asking them to. Maybe you should study how those 24 guys made it work and do it.

 

[Lucias]

Mav,
How can you be so sure it is working? Michael already stated that he didn't have traders clearing 30k (at least 12) and he was unwilling to share what his top trader made (but promised to at the end of this year).

I think it is too soon to say whether it is working.. but so far there is plenty of evidence that its not working.

Quote from Maverick74:

Lucias, they have 24 live traders right now. What they are doing is working. They are not going to change it because you are asking them to. Maybe you should study how those 24 guys made it work and do it.

 

[Maverick74]

Quote from Lucias:

Mav,
How can you be so sure it is working? Michael already stated that he didn't have traders clearing 30k (at least 12) and he was unwilling to share what his top trader made (but promised to at the end of this year).

I think it is too soon to say whether it is working.. but so far there is plenty of evidence that its not working.

Lucias, I'm not sure if you are a card carrying communist or something but Michael runs a business. He wants to be profitable. It seems at least right now, they have found a way to make this model work for "them" over the short term. Whether or not it works long term, we'll have to see. Remember, his first goal is turn a profit for himself and his investors, that's how a business works. If you can make what you do fit in his model, great. If not, move on. But you keep saying over and over again it's too hard and yet 24 guys, most of them really young, have found a way to pass the combines and go live. Why don't you listen to their youtube videos and go over their performance reports and try to learn something. It appears "they" can do something that you can't. Just suck it up and move on. It's not the end of the world.

 

[Lucias]

Mav,

You don't need to attack me just because my logic is stronger then your emotion. Every gambler has to lose sometimes to win. You have a big problem with losing..that's a concern.

I will take this loss here.. Yes, I am a card carrying communist. you win.

Quote from Maverick74:

Lucias, I'm not sure if you are a card carrying communist or something but Michael runs a business. He wants to be profitable. It seems at least right now, they have found a way to make this model work for "them" over the short term. Whether or not it works long term, we'll have to see. Remember, his first goal is turn a profit for himself and his investors, that's how a business works. If you can make what you do fit in his model, great. If not, move on. But you keep saying over and over again it's too hard and yet 24 guys, most of them really young, have found a way to pass the combines and go live. Why don't you listen to their youtube videos and go over their performance reports and try to learn something. It appears "they" can do something that you can't. Just suck it up and move on. It's not the end of the world.

 

[Maverick74]

Quote from Lucias:

Mav,

You don't need to attack me just because my logic is stronger then your emotion. Every gambler has to lose sometimes to win. You have a big problem with losing..that's a concern.

I will take this loss here.. Yes, I am a card carrying communist. you win.

I'm not attacking you. You keep saying no one can do this yet there is mathematical evidence to the contrary. They have 24 live traders right now. Who knows how many they have had total. But they publish all their combine results and they put all their interviews up on youtube. Just figure it out dude. That's like me saying no one can make it to the NFL to play football when obviously I saw plenty of guys today that made it to the NFL. If you can't succeed in the combine then move over and let someone else try.

 

[baggerlord]

Quote from Lucias:

Mav,

You don't need to attack me just because my logic is stronger then your emotion. Every gambler has to lose sometimes to win. You have a big problem with losing..that's a concern.

I will take this loss here.. Yes, I am a card carrying communist. you win.

Oh Gawd. This coming from the guy that is afraid that losing on the sim program will have too big of a negative effect on his confidence. Beggars can't be choosers man! You are like a bum on the street that throws back a 5 dollar bill because it is wrinkled lol.

 

[Lucias]

Mav, when did I ever say no one can do this? I never said that. There's a decent chance I can do it myself. I figure there is about about a 42% chance that I can pass on first try (62% when I'm confident.. lol) . I have hit these type of returns in the past. My real point was more nuanced but basically I felt that the rules as designed are just as likely to cut out good traders while still likely to allow traders who aren't likely to do well over the long term to pass.

I had 4 points and only one dealt with the profit objectives.

Some of the points dealt with what I felt that were misrepresentations in what they claim to offer versus what they really offer. I don't know if it meets the definition of fraud but its certainly misleading.

One point dealt with the account size they claim to fund you at. I can't make the math work as to why they claim they give you a 30k account.

The overnight margin on the ES is about $4375 now and they give a 3 lot max which comes out to $13,125.. add the $1,000 loss limit and you get $14,125. How do you get 30k from that? Even if they let you fail 4x and factor that in.. .that's a max of $17,125.

At least for traders trading the ES.. there is no reason for them to claim they fund you with a 30k account because its absolutely not true. Michael, if you believe in 1k total loss limits and programs then you should advertise them prominently. All I ask is just make it clear what the customer is getting.. I don't think that's too much to ask and it will also protect you from the complaints when someone thinks they are getiting a 30k account to find out they only get 1k.

Quote from Maverick74:

I'm not attacking you. You keep saying no one can do this yet there is mathematical evidence to the contrary. They have 24 live traders right now. Who knows how many they have had total. But these publish all their combine results and they put all their interviews up on youtube. Just figure it out dude. That's like me saying no one can make it to the NFL to play football when obviously I saw plenty of guys today that made it to the NFL. If you can't succeed in the combine then move over and let someone else try.

 

[Maverick74]

Quote from Lucias:

Mav, when did I ever say no one can do this? I never said that. There's a decent chance I can do it myself. I figure there is about about a 42% chance that I can pass on first try (62% when I'm confident.. lol) . I have hit these type of returns in the past. My real point was more nuanced but basically I felt that the rules as designed are just as likely to cut out good traders while still likely to allow traders who aren't likely to do well over the long term to pass.

I had 4 points and only one dealt with the profit objectives.

Some of the points dealt with what I felt that were misrepresentations in what they claim to offer versus what they really offer. I don't know if it meets the definition of fraud but its certainly misleading.

One point dealt with the account size they claim to fund you at. I can't make the math work as to why they claim they give you a 30k account.

The overnight margin on the ES is about $4375 now and they give a 3 lot max which comes out to $13,125.. add the $1,000 loss limit and you get $14,125. How do you get 30k from that? Even if they let you fail 4x and factor that in.. .that's a max of $17,125.

At least for traders trading the ES.. there is no reason for them to claim they fund you with a 30k account because its absolutely not true.

Jesus man, I should be given the humanitarian of the year away for keeping this conversation going.

Lucias, here is my logic. They, like me, believe that traders should risk 2% of their "equity" a day daytrading. The 2% number of the daily risk matches up with the "account size". For example, on a 50k account, a 2% daily loss is 1k. That is EXACTLY what your daily loss is! Amazing!

Let's see if this formula holds for the 100k account. Max daily loss is 2k. And 2k is 2% of 100K!!!! Bingo!

OK, we're going for the trifecta here. No whammies please. We have a 150k with a 3k daily stop. So 150k times 2% is..................3k!!!!!! KAWABUNGA!!!!!

Did you seriously not figure this out or are you yanking my chain. I did the math in my head after spending 30 seconds on their site.