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My Path To Success
- Thread starter Lucias
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I'm not in flow. I've been working all weekend on some new strategies. I came up with one that looked promising. It looks like it can return 50% or better over the last 10 years. It is not a day trading system though and my goal is to focus exclusively on day trading systems. Plus, it is another ES system and my main goal is to develop a crude oil system or something uncorrelated to what I'm doing.
However just a system or data doesn't mean anything to me until I get a "feel" for it. I'll pour over lots of data to get my feel. I don't have a feel for this system yet.
The hardest part for me is when I'm testing my ideas. It takes all my brain power. I'm great at coming up with ideas and predicting the market. But, when it comes down to the actual process of building the systems: it always proves very difficult.
It makes me wonder if I'm utilizing my mind in the right way because the one reason I like to predict the market is that it is easy for me. But, building systems is very hard. It takes all my mental effort and makes me realize how hard it is to do anything at all.
The good news is that I did find some worthwhile and high return ideas. But, I also have to stay focused on the type of strategies I can execute and that I need. Maybe I can do something with this with the weekly binaries. It will take more work to determine.
I am only seeking very high return strategies 50% annual or better. This one looks like it can do that and maybe more. So, I may want to continue to develop it.
In general, I am looking to build systems that can
Return > 50% annually
One day to 5 day hold max
Trade a market other then the ES or/and uncorrelated to my existing methods
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Crude is a market that is somewhat foreign to me. I do not know much about it or what types of indicators I might use in building a high return system for it.
However just a system or data doesn't mean anything to me until I get a "feel" for it. I'll pour over lots of data to get my feel. I don't have a feel for this system yet.
The hardest part for me is when I'm testing my ideas. It takes all my brain power. I'm great at coming up with ideas and predicting the market. But, when it comes down to the actual process of building the systems: it always proves very difficult.
It makes me wonder if I'm utilizing my mind in the right way because the one reason I like to predict the market is that it is easy for me. But, building systems is very hard. It takes all my mental effort and makes me realize how hard it is to do anything at all.
The good news is that I did find some worthwhile and high return ideas. But, I also have to stay focused on the type of strategies I can execute and that I need. Maybe I can do something with this with the weekly binaries. It will take more work to determine.
I am only seeking very high return strategies 50% annual or better. This one looks like it can do that and maybe more. So, I may want to continue to develop it.
In general, I am looking to build systems that can
Return > 50% annually
One day to 5 day hold max
Trade a market other then the ES or/and uncorrelated to my existing methods
-----
Crude is a market that is somewhat foreign to me. I do not know much about it or what types of indicators I might use in building a high return system for it.
Detailed report later. First trade was short, closed it for tiny profit (+$10 net) and was done for the day. I got sucked by in with a late day short and was down only -$18 until the 4:00 to 4:15 session. It went against me about $90 during the 4:00-4:15 (@ $20 per point). In my sim futures account, I still have position open but my nadex contracts expire.
I've identified my late trades do not tend to work. I try to place all trades by 11. The late day trades suffer due to not having much time for them to work out.
By 6:00, the market will probably be back to 1332.. I'm learning just how critical these "pinch" points are, i.e contract expiry points.
I've identified my late trades do not tend to work. I try to place all trades by 11. The late day trades suffer due to not having much time for them to work out.
By 6:00, the market will probably be back to 1332.. I'm learning just how critical these "pinch" points are, i.e contract expiry points.
Quote from Lucias:
I am only seeking very high return strategies 50% annual or better. This one looks like it can do that and maybe more. So, I may want to continue to develop it.
Let me give u an advice. Those (SMALL TRADERS) that are seekijng high return strategies will lose. I can almost guarantee u that.
Look at madoff, his annual rate return was above 20%. He had to cheat to get that kind of rate. He had all the money to hire the best traders, but decided to cheat.
Emg, you honestly come across as the least knowledgeable person here. I'm already producing significant returns: at my peak I was 150% on actual capital in account and 50% on the model account. I'm still up nearly 30% on the capital in the account and the year is not over.
I have backtested strategies that did 80% every year for past 5 years and my audited account at C2 is tracking closely to the expected performance.
I'm one of the best in the world in predicting the market. I may or may not be profitable. But, I will serve..
Now, you are correct that most people can't do what I do. You are correct when you talk about averages. Obviously, I take more risk in aiming for higher gain.. I can't argue that. Indeed, there are significant limitations and challenges when trading a small account. But, that's just part of the challenge.
I plan to put up even more money in the near future and increase my size. This is obviously a learning experience which I personally feel is quite worthwhile.
I have backtested strategies that did 80% every year for past 5 years and my audited account at C2 is tracking closely to the expected performance.
I'm one of the best in the world in predicting the market. I may or may not be profitable. But, I will serve..
Now, you are correct that most people can't do what I do. You are correct when you talk about averages. Obviously, I take more risk in aiming for higher gain.. I can't argue that. Indeed, there are significant limitations and challenges when trading a small account. But, that's just part of the challenge.
I plan to put up even more money in the near future and increase my size. This is obviously a learning experience which I personally feel is quite worthwhile.
Got hammered again.. smallish position but managed to short the lows. It would have been a $40 to $50 loss. This was a $100+ loss ($20 per point) However, my market read and patterns indicated we would go lower and so I held.
Over about 1 minute, the market almost just gap up to the 1340 level. This was a level I felt it could gap too but not nearly so fast.
This is difficult because I felt I was trading well. I feel like some news or something must have happen I didn't know about. This is a problem and something I am going to try to figure out how to correct and stay in tune with news. I'm careful not to short off bottoms because of these types of moves.
Its not often that I really think I'm right and lose. A bit disconcerting. The interesting thing is when I'm in a bad trade and lose $10 then it kills me. If I feel I'm in a good trade and lose $100 then I don't feel anything. I make a note of how I feel.
I've given back quite a lot now. I felt I was trading small enough but I've given back too much on just average trades. This is a warning. The one thing in my trading I've always managed to do is hold onto all my winnings. Not giving back winnings is very critical to building more winnings..
I'll review my performance and try to use this to learn more. I specialize in the type of move I got caught in which makes it all the more worse.
Over about 1 minute, the market almost just gap up to the 1340 level. This was a level I felt it could gap too but not nearly so fast.
This is difficult because I felt I was trading well. I feel like some news or something must have happen I didn't know about. This is a problem and something I am going to try to figure out how to correct and stay in tune with news. I'm careful not to short off bottoms because of these types of moves.
Its not often that I really think I'm right and lose. A bit disconcerting. The interesting thing is when I'm in a bad trade and lose $10 then it kills me. If I feel I'm in a good trade and lose $100 then I don't feel anything. I make a note of how I feel.
I've given back quite a lot now. I felt I was trading small enough but I've given back too much on just average trades. This is a warning. The one thing in my trading I've always managed to do is hold onto all my winnings. Not giving back winnings is very critical to building more winnings..
I'll review my performance and try to use this to learn more. I specialize in the type of move I got caught in which makes it all the more worse.
One thing I need to do is track where I'm making money and losing money. I have a good idea where I make money:
System trades: Sig. winning
Trading off the open/morning: Sig. Winning
Predictions when I'm confident: Winning
The trades that have been costing me:
Shorts: Losing
Late day trades: Losing
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Late day movements often reverse and don't have a lot of time to get better pricing. I've contemplated cutting out all my shorts. But, I still short because I think it is a skill that is useful to have. I think shorting is even more difficult in this market then the markets I remember from past and studies demonstrate that too.
My difficulty in shorting is that even when I'm right often the market will reverse off the lows too fast to take profit. And, when we get a big runner then one is taking profits too fast too. The solution is to take profits faster but also because shorts are lower probability one needs the big runners to make it even worthwhile.
Also, I've always said I'm the best predictor but I know I'm not the best trader. I'm not a very good trader but I'm just so strong in knowing where the market will go that I've did okay. I'm going to be working and training even more to get better as a trader.
I'm consciously over leveraged to get the big returns. Most CTA's have sharpe ratios less then 1. My discretionary sharpe is around 1.6. My system sharpe is almost 3. The relevance is that while I know my discretionary trading adds a lot of value (robustness, lower correlation, etc). My system trades are able to be leveraged to greater extent. It is very important that I carefully consider the leverage that I am using.
System trades: Sig. winning
Trading off the open/morning: Sig. Winning
Predictions when I'm confident: Winning
The trades that have been costing me:
Shorts: Losing
Late day trades: Losing
---------
Late day movements often reverse and don't have a lot of time to get better pricing. I've contemplated cutting out all my shorts. But, I still short because I think it is a skill that is useful to have. I think shorting is even more difficult in this market then the markets I remember from past and studies demonstrate that too.
My difficulty in shorting is that even when I'm right often the market will reverse off the lows too fast to take profit. And, when we get a big runner then one is taking profits too fast too. The solution is to take profits faster but also because shorts are lower probability one needs the big runners to make it even worthwhile.
Also, I've always said I'm the best predictor but I know I'm not the best trader. I'm not a very good trader but I'm just so strong in knowing where the market will go that I've did okay. I'm going to be working and training even more to get better as a trader.
I'm consciously over leveraged to get the big returns. Most CTA's have sharpe ratios less then 1. My discretionary sharpe is around 1.6. My system sharpe is almost 3. The relevance is that while I know my discretionary trading adds a lot of value (robustness, lower correlation, etc). My system trades are able to be leveraged to greater extent. It is very important that I carefully consider the leverage that I am using.
NET P&L: +$524
Today was short the crude. I could have taken a $160 winner. It moved pretty quickly though and wasn't able to capture. I closed it out for about $80 in profit. If I'd not closed it then I'd be about break even. In my opinion, crude has a greater tendency to move fast and hard and then revert fast and hard. It certainly has a different personality then the SP 500. I don't know how to trade it but I've seen more spike reversals in it then other instruments. I think this means I need to be setting targets, watching for v bottoms, and taking profits on runners. But it also had a tendency to run hard too, hmm.
Well last night I was short the S&P 500. I would have been able to close out an $80 or $100 winner but the market moved violently against me and so that was $100 loser.
There is no way around it: when trading short term it is a fine line between losing and winning. In two cases, I was right on my direction and if I had traded better then I'd be up $200 instead I'm down.
But I'm also a great example that it is possible to trade with a tiny, tiny account at least at NADEX. I do plug NADEX because without this exchange I"d still be on the simulator. I don't know of any option for US traders with tiny accounts that has this much potential (i.e sub $5,000 to $7,000 account).
I've had $1,000 in my account. I'm trading a model 3k account (but I had my account at IG and they closed it -- so I only had 1k at NADEX). Anyway, I've had 1k in my account for past few months and at my peak I was up to $2500 or a NET $1500 return on capital. That's 150% on capital or 15% on a 10k balance.
Even today, at a relative low point I'm still up $245 on the account balance (I had closed profits from earlier). So, it is possible to trade a tiny account profitably but it is not easy. I have 2 of the top ranked futures systems at C2 that are older then 6 months. Obviously, I think that has to approach this professionally to have a chance. I'm learning all the time. I'm always working to learn more and improve.
Maybe in the short term I'd make more profits just by trading my system. But, I think in the long term that I'm positioning myself better by building more systems and working on my discretionary trading vis-via efforful practice.
I've identified that I need better news and decision support tools . I need to think about my quote sources too because I just use market watch or always delayed quotes. This isn't a problem most of the time. But, sometimes it is. If last night, I knew there wasn't any news then I would have held my short on a hypothesis it was a single large trader. But without knowing then I was afraid some news at hit the wire that could send price shooting even higher.
Today was short the crude. I could have taken a $160 winner. It moved pretty quickly though and wasn't able to capture. I closed it out for about $80 in profit. If I'd not closed it then I'd be about break even. In my opinion, crude has a greater tendency to move fast and hard and then revert fast and hard. It certainly has a different personality then the SP 500. I don't know how to trade it but I've seen more spike reversals in it then other instruments. I think this means I need to be setting targets, watching for v bottoms, and taking profits on runners. But it also had a tendency to run hard too, hmm.
Well last night I was short the S&P 500. I would have been able to close out an $80 or $100 winner but the market moved violently against me and so that was $100 loser.
There is no way around it: when trading short term it is a fine line between losing and winning. In two cases, I was right on my direction and if I had traded better then I'd be up $200 instead I'm down.
But I'm also a great example that it is possible to trade with a tiny, tiny account at least at NADEX. I do plug NADEX because without this exchange I"d still be on the simulator. I don't know of any option for US traders with tiny accounts that has this much potential (i.e sub $5,000 to $7,000 account).
I've had $1,000 in my account. I'm trading a model 3k account (but I had my account at IG and they closed it -- so I only had 1k at NADEX). Anyway, I've had 1k in my account for past few months and at my peak I was up to $2500 or a NET $1500 return on capital. That's 150% on capital or 15% on a 10k balance.
Even today, at a relative low point I'm still up $245 on the account balance (I had closed profits from earlier). So, it is possible to trade a tiny account profitably but it is not easy. I have 2 of the top ranked futures systems at C2 that are older then 6 months. Obviously, I think that has to approach this professionally to have a chance. I'm learning all the time. I'm always working to learn more and improve.
Maybe in the short term I'd make more profits just by trading my system. But, I think in the long term that I'm positioning myself better by building more systems and working on my discretionary trading vis-via efforful practice.
I've identified that I need better news and decision support tools . I need to think about my quote sources too because I just use market watch or always delayed quotes. This isn't a problem most of the time. But, sometimes it is. If last night, I knew there wasn't any news then I would have held my short on a hypothesis it was a single large trader. But without knowing then I was afraid some news at hit the wire that could send price shooting even higher.
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