You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
My Path To Success
- Thread starter Lucias
- Start date
- Status
- Not open for further replies.
Yep.. I suck, 120% return in a few weeks NET. Over net 50% return on the model account. Even at the current drawdown state, I'm at over 21% return on the model account and 35% return on the actual capital sense I restarted trading.
I have 2 of the top ranked long term tracked futures system at c2. I can't link them though because of rules here.
However, I agree I need to review my plan and rethink my leverage. My mechanical system at C2 has returned 80%+ YOY for the past several years. My real problem is I'm shooting for returns outside of the limits of what my systems and my own abilities.
This is indeed a problem. The solution will be to refine my strategies and my abilities to return more and/or to reduce my leverage.
I have 2 of the top ranked long term tracked futures system at c2. I can't link them though because of rules here.
However, I agree I need to review my plan and rethink my leverage. My mechanical system at C2 has returned 80%+ YOY for the past several years. My real problem is I'm shooting for returns outside of the limits of what my systems and my own abilities.
This is indeed a problem. The solution will be to refine my strategies and my abilities to return more and/or to reduce my leverage.
Quote from tycoonman:
dude no offense but u suck. get a system.
Yes, I am down from the equity high. Yet, I still have made money overall. I have been in net profit sense almost I started! I am down from my equity high, is all. I just changed the way I reported it from my total account value to the p&l that I had made.
Although this could change of course.. the way things are swinging. couple more losses. Need to keep it tight.
Although this could change of course.. the way things are swinging. couple more losses. Need to keep it tight.
Quote from ksmetana:
If you have a successful system, why are you losing money? You say you are up, but your P&L is dwindling...
If you have a proven, backtested system, you should just automate it.
Your mock accounts are up, but you are down? Or am I reading something wrong???
I've been seeing a recent pattern.
* I predict the market.
* Market starts to make a small sharp move against me
* I detect the sharp move against me
* I get out for a small loss before the break
* The market tanks and heads way lower
As for why I may be seeing this pattern more often, I think part of it is that my contract is only good for 1 day. My "old" bread and butter play typically expected the first move on day 1 but sometimes it was delayed to day 2. It was only over the most recent 6 months or so where my average trade hold shortened to 24 hours. This is certainly partially to explain.
Another factor is I'm a bit gun shy and not wanting to take a lot of risk. It may be simply that I'm not willing to give the trades enough room.
2 other factors though that could be causing this:
1. There are too many shorts. We get the micro short covering rallies and then the market tanks. This seems reasonable. I'm especially cognizant of these types of patterns.
2. There are new algorithms or operators in the market. It almost feels like someone is watching my trades and using it against me. I doubt it is for me but some big operators maybe trying to get out of the market. Maybe they are buying aggressively to run it up over a few minutes and then dump even more.
I try not to use typical technical analysis. But, maybe my methods are not as proprietary as I'd like.
In order to resolve this, I can think of a few ideas:
A. Widen my stops and risk
B. Wait for a momentum surge before shorting
I'm, also, seeing that there are no good dips in this market. Even the best new lows get sold aggressively. I think this will turn around soon but it may take us down to 1250. The risk of a climatic sell in my opinion is elevated but has decreased slightly no that we are at the 1270 level. A climatic sell off to 1250 is still a possibility though.
* I predict the market.
* Market starts to make a small sharp move against me
* I detect the sharp move against me
* I get out for a small loss before the break
* The market tanks and heads way lower
As for why I may be seeing this pattern more often, I think part of it is that my contract is only good for 1 day. My "old" bread and butter play typically expected the first move on day 1 but sometimes it was delayed to day 2. It was only over the most recent 6 months or so where my average trade hold shortened to 24 hours. This is certainly partially to explain.
Another factor is I'm a bit gun shy and not wanting to take a lot of risk. It may be simply that I'm not willing to give the trades enough room.
2 other factors though that could be causing this:
1. There are too many shorts. We get the micro short covering rallies and then the market tanks. This seems reasonable. I'm especially cognizant of these types of patterns.
2. There are new algorithms or operators in the market. It almost feels like someone is watching my trades and using it against me. I doubt it is for me but some big operators maybe trying to get out of the market. Maybe they are buying aggressively to run it up over a few minutes and then dump even more.
I try not to use typical technical analysis. But, maybe my methods are not as proprietary as I'd like.
In order to resolve this, I can think of a few ideas:
A. Widen my stops and risk
B. Wait for a momentum surge before shorting
I'm, also, seeing that there are no good dips in this market. Even the best new lows get sold aggressively. I think this will turn around soon but it may take us down to 1250. The risk of a climatic sell in my opinion is elevated but has decreased slightly no that we are at the 1270 level. A climatic sell off to 1250 is still a possibility though.
P&L: +$332
I've not traded at my potential. A part of this is that I've matters in my life that prevent me from functioning at my full potential. But, also, I'm not operating on my first principles. I typically don't use s/r to any degree but rely on my proprietary patterns. I've made the mistake of using s/r instead of my market read because the volatility has given me what appeared to be "low risk" entries. I've identified this problem and will correct it by returning to my market read and patterns. I'm typically catching trend days like today. I was a hair from pulling the trigger but stopped short. I tried for a reversal in the 1265 area.
The other factor hurting my performance is my system is experiencing some of its worst run in history. It has logic protect its profit. But, the fail safes are not triggered yet.
I'm going to focus on making more predictions and getting back in the rhythm of the market. Start taking my trades based on my market read and not random probabilities. Smaller positions and more risk will likely be required.
I've not traded at my potential. A part of this is that I've matters in my life that prevent me from functioning at my full potential. But, also, I'm not operating on my first principles. I typically don't use s/r to any degree but rely on my proprietary patterns. I've made the mistake of using s/r instead of my market read because the volatility has given me what appeared to be "low risk" entries. I've identified this problem and will correct it by returning to my market read and patterns. I'm typically catching trend days like today. I was a hair from pulling the trigger but stopped short. I tried for a reversal in the 1265 area.
The other factor hurting my performance is my system is experiencing some of its worst run in history. It has logic protect its profit. But, the fail safes are not triggered yet.
I'm going to focus on making more predictions and getting back in the rhythm of the market. Start taking my trades based on my market read and not random probabilities. Smaller positions and more risk will likely be required.
P&L: +$365
I was up around $230 at the peak today. To my credit, I took off 1 contract (out of 5) at the highs. I expected the market to go higher but just wanted to reduce my risk. In hindsight, taking off more risk would have been better. This is proving a difficult market for my system.
I would probably continue to hold a portion long but my contracts expire at the end of the day. While my system closes out trades at EOD, I typically gain a bit by exiting overnight or next day at a target. I weigh a slightly higher probability of a significant rally tomorrow.
I want to talk about risk. I'm using vertical spreads at NADEX. Spreads are different then futures in that I have to pay a premium but have downside protection. The premium varies based on the time contract has left and the distance from the floor.
We can look at 2 types of risk: maximum risk and realized risk. Using a risk limited instrument reduced the maximum risk but tends to increase the realized risk. This is true of any type of insurance.
But, there is another type of risk: path risk. As Dr. Brett said, using stops/leverage exposes one to path dependency --you may call the direction but still lose if you fail to understand the path the market takes. Spreads reduce path dependency risk because they are based on expiration, i.e. no knockout.
However, the spreads introduce two related types of risk: time risk and end point risk. End point risk is risk exposure at the "end" of the contract, i.e at expiration. The contract is settled based on expiration, not 2 hours after expiration which may be very advantageous to you -- the trader. The other risk introduced is time risk, as all options: they have a finite lifetime. Nadex currently only offers 1 day spreads.
I typically hold for less then 24 hours. But, what I didn't realize is that it is not unusual for me to hold across day boundaries. Of course, you might say you can just buy a new spread. You can but then the premium resets which means you may not find the risk/reward desired.
If the spreads were good for just 2 days then that wouldn't be a problem for me, although the extra premium could be.
Okay but it is possible to choose a wider spread without any premium. This is true. However, spreads don't allow stops. So, I'd be risking a large portion of my account on a single position. While undesirable, it would be okay for taking out a measured move and given I could watch the market. But, its a risk I'm not eager to take.
The other problem is finding a price to floor ratio that offers the premium you desire. Buying an OTM spread may have a lower dollar risk but one pays up by giving up the market price, i.e buys above the market. In general, i prefer spreads with limited and moderate risk and less premium. i.e an 8 to 20 point spread. It is often not possible to find such a spread that fits my r/r requirement.
For example, I was filled last night at 1263.50 when the market traded at 1257is. I bought the low but payed up to have limited risk. I expected a much larger move today and it seem like a good play.
In general I need to find a better way to price these instruments so I can better predict them based on the underlying. I, also, need to start taking more discretionary trades sense my system is not performing well in the current environment. Although today both the system and my market read were in line..
Very disappointing though.. appx $250 let slip there.
I was up around $230 at the peak today. To my credit, I took off 1 contract (out of 5) at the highs. I expected the market to go higher but just wanted to reduce my risk. In hindsight, taking off more risk would have been better. This is proving a difficult market for my system.
I would probably continue to hold a portion long but my contracts expire at the end of the day. While my system closes out trades at EOD, I typically gain a bit by exiting overnight or next day at a target. I weigh a slightly higher probability of a significant rally tomorrow.
I want to talk about risk. I'm using vertical spreads at NADEX. Spreads are different then futures in that I have to pay a premium but have downside protection. The premium varies based on the time contract has left and the distance from the floor.
We can look at 2 types of risk: maximum risk and realized risk. Using a risk limited instrument reduced the maximum risk but tends to increase the realized risk. This is true of any type of insurance.
But, there is another type of risk: path risk. As Dr. Brett said, using stops/leverage exposes one to path dependency --you may call the direction but still lose if you fail to understand the path the market takes. Spreads reduce path dependency risk because they are based on expiration, i.e. no knockout.
However, the spreads introduce two related types of risk: time risk and end point risk. End point risk is risk exposure at the "end" of the contract, i.e at expiration. The contract is settled based on expiration, not 2 hours after expiration which may be very advantageous to you -- the trader. The other risk introduced is time risk, as all options: they have a finite lifetime. Nadex currently only offers 1 day spreads.
I typically hold for less then 24 hours. But, what I didn't realize is that it is not unusual for me to hold across day boundaries. Of course, you might say you can just buy a new spread. You can but then the premium resets which means you may not find the risk/reward desired.
If the spreads were good for just 2 days then that wouldn't be a problem for me, although the extra premium could be.
Okay but it is possible to choose a wider spread without any premium. This is true. However, spreads don't allow stops. So, I'd be risking a large portion of my account on a single position. While undesirable, it would be okay for taking out a measured move and given I could watch the market. But, its a risk I'm not eager to take.
The other problem is finding a price to floor ratio that offers the premium you desire. Buying an OTM spread may have a lower dollar risk but one pays up by giving up the market price, i.e buys above the market. In general, i prefer spreads with limited and moderate risk and less premium. i.e an 8 to 20 point spread. It is often not possible to find such a spread that fits my r/r requirement.
For example, I was filled last night at 1263.50 when the market traded at 1257is. I bought the low but payed up to have limited risk. I expected a much larger move today and it seem like a good play.
In general I need to find a better way to price these instruments so I can better predict them based on the underlying. I, also, need to start taking more discretionary trades sense my system is not performing well in the current environment. Although today both the system and my market read were in line..
Very disappointing though.. appx $250 let slip there.
I don't intend to share my edges here. I have share some of those in other formats (for anyone interested they can message me). But, I will from time to time share some of my observations.
One observation is that I've been seeing 1-day delayed rallies in the current market. I feel we are getting these delayed rallies because the market is just so weak that it takes about a day to absorb the selling and the market to perk up. This has hurt my performance significantly because my contracts expire at the end of day.
I for sure feel like I'm getting gamed. I used to be doing the gaming and now I'm the one getting gamed. But, also, I realize I'm a bit slow in the current market.. not quite at my best which is why I'm relying more on my system because I know my current state is below par. Unfortunately, my system is also operating below par.
Buying the dips is also proving difficult because every new high is violently sold out. The opens are especially treacherous, as well.
All in all this is a difficult market to trade using reversion principles but those trading using market profile (trending) methodology have probably did well.
In general in the current market, the optimal action has been to hold for the trades for a bit longer then usual and to use those targets to get out.
Right now the futures seem to be suggesting that the market will continue to rally -- is in the process of forming a bottom. However, the RIMM report was very negative and I could see that triggering more selling.
One observation is that I've been seeing 1-day delayed rallies in the current market. I feel we are getting these delayed rallies because the market is just so weak that it takes about a day to absorb the selling and the market to perk up. This has hurt my performance significantly because my contracts expire at the end of day.
I for sure feel like I'm getting gamed. I used to be doing the gaming and now I'm the one getting gamed. But, also, I realize I'm a bit slow in the current market.. not quite at my best which is why I'm relying more on my system because I know my current state is below par. Unfortunately, my system is also operating below par.
Buying the dips is also proving difficult because every new high is violently sold out. The opens are especially treacherous, as well.
All in all this is a difficult market to trade using reversion principles but those trading using market profile (trending) methodology have probably did well.
In general in the current market, the optimal action has been to hold for the trades for a bit longer then usual and to use those targets to get out.
Right now the futures seem to be suggesting that the market will continue to rally -- is in the process of forming a bottom. However, the RIMM report was very negative and I could see that triggering more selling.
- Status
- Not open for further replies.