Need help trading "size" in the NQ's

If you start out trading NQs at 300-500 a pop with your level of experience, that $500K should last two... maybe... three days.
 
Quote from ElectricSavant:

Many CTA's use an excepted industry standard of 1% of the equity under management compared to the stop used. For example:

$500,000.00*1%=$5,000.00=total loss risked against stop loss being executed.

So that would mean $5,000.00/$20.00=250 points. So if you trade with a stop of 10 points then you could trade 25 lots. I suggest that you scale in with 2 or 3 entries and scale out with 2 or 3 exits.

Also there will be excess funds in your Commodities account which should be held in quarterly t-bills.

Michael B.
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Maybe a bit conservative for someone trading their own money but safe. You can move a 500 lot instantly but not at the market. Look at market depth to get an idea how far down you would have to go to get filled.
 
Quote from Ebo:

I agree.....NO reason whatsoever to trade more than 5 NQM's at a time, especially in this volatile market. If I can take 2.5 points twice a day on 5 contracts that is $10,000 a month or $120,000 a year. That is a return of over 100% per month since you only need $1850 performance bond/contract. Why would you even think of trading more than 10 at a time? Where do these people get these GRANDIOUS ideas? If you can trade well for 3 months without blowing up, then you increase size. NOBODY on this board trades 300-500 contracts.
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Why did you choose the 2.5??

thanks in advance.
 
It was only hypothetical.
How many points a day do you make on the average?
My only point was you can make a nice living trading with constant singles and doubles. There is no need to put $500K at risk to have a respectable ROI.
 
Quote from Ebo:

It was only hypothetical.
How many points a day do you make on the average?
My only point was you can make a nice living trading with constant singles and doubles. There is no need to put $500K at risk to have a respectable ROI.
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I do not trade the NQ.

Both my equities and commodities algorithms are capital limited as I apply them.

I agree with you on makng a nice income with small or moderate capital. Actually inital capital is not omportant at all in terms of how small you can start and wind up very rich. Several people here definitely have hardons about what I think is possible. I am glad you are not getting the same flak.

The NQ would yield about 80 plus points today on 5 contracts.
 
Thanks Jack!

As long as nobody gets hurt in the process.
I am a firm believer in strict risk management.
Much rather make a little than lose a lot.
 
If you have a proven, successfully tested edge, the only restrictions that one should be concerned with is liquidity with respect to the time frame which your edge applies and a sound money management system.

If your system is designed to scalp a few points at a time, trading a couple hundred contracts will turn you into a bull in a china shop. If your system is designed to catch intermediate turns on the 60min chart, by all means learn how to scale in and go for it.

Everyone has different risk profiles to consider, but what it all boils down to is your edge: do you really have one? If one truly has an edge, he or she should seek to apply as much leverage as possible within the constraints of liquidity and sound money management vs account size. The corollary is getting an 11 in blackjack -- the only factors which would cause you NOT to double down would be a significant reduction in your edge (a very negative deck count and dealer with face card showing, for example), not the size of your bet or bankroll.
 
First term: VAR
Second term: Fixed Ratio
Good Luck with the 500K, if i were you i wouldn't worry about liquidity at the moment.
Worry about everything else FIRST!
If you were really serious about moving 500 NQ contracts with a 500K account, you will last less than a week as I see you are a beginner.
NOTE: 500 NQ is moving $15,000,000 worth of NQ.
Needless to say you can be wiped out at the first spike.
 
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