Prop Firm Proposal

It's official. I'm switch to IB! I mean I already have IB on my IRA. But I'll open a full margin account on IB. Today, I got FCKed by Robinhood. The app froze while I was getting out of my trades(albeit they were highly profitable). I'm up 4.64% instead of 7.81% had the app didn't freeze on me. I know it's a mobile app and probably tons of newbies sending in borders up the wazoo.

But it served its purposes. I've made a ton of money from swing trading through Robinhood. I'll still trade it while I'm waiting for my account to open and get funded.
 
Just a status update for all my friends here on ET.

Yes, I opened an IB account BUT I still kept my Robinhood. The reason is that I saw that my P&L on swing trading(Robinhood) was SIGNIFICANTLY larger than my daytrading PL at IB.

The good news, however, is that my daytrading HAS improved. I've consistently made hundreds daily with very little drawdown. My hit rate(% correct) on my daytrades are actually pretty high.

Yet, I'm still disappointed by my total daytrading P&L. it's in the hundreds daily not in the thousands like my swing. Note: I don't swing trade everyday. There are days and weeks it's in cash waiting for the next good entry. While on the daytrade, there are usually at least one decent trade a day. I just need to ride it with big volume.

I know you guys will tell me just to increase my # of shares. I've tried that but when I do I'm back in my old daytrading mode and bad habits and get scared and get out too soon. Take a few cents profits in a multiple dollar move. Yet, when I'm swing trading I can sit through all that noise and ride for multiple point moves because I'm in a definite frame of mind. Also, because Robinhood doesn't quite have real-time quote or charting. So, physically and psychologically I don't see the wild swings.

Not sure how to overcome this.

But I'm glad to report that my daytrading has improved and I'm working hard to get even better.
 
Happy Holidays ET!

Just a quick yearend update! Since I last wrote on this back in Sept, a lot has changed and improved. My daytrading P&L is now much better than before. It's a combination of BOTH equities AND futures! I'm trading multiple accounts with different strategies. This is all on IB with the 4x intraday and 2x overnight. For my account size, it seems to be enough. Though more would be nice..

I had one big COLOSSAL mistake that costed me dearly. NG long. As you know natural gas(NG) had a horrific downtrend. I should have known better than try to pick the bottom on that many contracts and holding it that long. Seems like a beginner's mistake is what really pissed me off more than the money. Yes, the money lost hurts. But I figure by now at this stage in my trading development I should have known better. Cut losses. Cut losses. Or trade with smaller number of contracts. Cut losses. Or better yet went short!

Water under the bridge. But surprisingly, I'm recovering nicely from my max drawdown. It's a sign that my trading skills have IMPROVED over time! In my old days, if I had a catastrophic loss like this I would be wiped out. I did get out before the ultimate bottom. Had I waited to the ultimate bottom I would have been TOTALLY WIPED out like in the past. But getting out a week or two earlier would have been even BETTER. Oh well.

Now, my account is having a steady march upward. Without that stupid NG trade I would be up for the year. Lessons learned.

I'm looking forward to 2016 and really putting my strategies, discipline, and effort to work! Given the way I've been trading and the consistency of my actions and thinkng about markets and PA I think it will be a great year.

I thought this day will never come. Back in 2001-2003 when I first started daytrading almost everyday was a net loser. Winners were far and few in between. I just didn't grasp the principles of trading. I didn't have the discipline to follow and execute correctly. It was just noise.

Now my P&L is much better but more importantly my consistency and thinking about market is more correct. And I cut losses much faster now when it shows I'm definitely wrong. No point holding through all that pain. And I'm riding my winners farther though there's still more work to maximize that. There's still a long road ahead before I get to the stage I want to me. But I believe I'm on the right path.

That's the nice luxury of trading on the side and working full-time. Every day I don't have the pressure to hit it out of the park(though occasionally I do). I just consistently make decent profits. And over time I'll just scale up the number of shares/contracts while my skills improve.

Think trading as a long term development. There's no point doing full-time until I make at least many multiples of my salary. I'm no where near that now. But it's a good goal to shoot for.

In meantime, I continue my work on my career and gain valuable marketable skills. It's a good hedge. Consider that ETers.

Good luck to all of us in 2016!

trader99
 
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Reflecting back on 2015, it was a wild but generally positive ride. I learnt a great deal and conquered a bit of my old demons. Slowly chipping it away.

Now, that I can do consistently(not necessarily everyday but more often than not) a few hundred bucks. That amount seems so small. Because I've seen days where I've been up multiple 4 figures(and sometimes more) that what was once only a fantasy now seem very bland.

I guess I gotta up my game. Back in 2001 when I was starting out, this would have been pretty kicking ass because back then I was negative on most days. But now that I have a much larger account and trading significantly better anything under a thousands doesn't excite me much.

In fact, a thousand barely excites me. I know I haven't been able to do that everyday. Maybe the goal should be CONSISTENCY! If I can consistently produce over $1K/day then I"m sure I'll be more excited. haha.

Lots to work on in 2016. Trading is an endless challenge. You can ALWAYS improve and get better over time.

Cheers!

trader99
 
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Maverick74 said:
No. That's what I'm trying to explain to you. The is the SAME. You have first loss at a prop firm. So whether you lose 5k at Acme Trading or 5k from home equity it's the exact same thing. You follow what I'm saying right? We are not talking about someone else backing you vs you backing yourself. In both situations you are backing yourself with your own capital and you take all the risk. The difference is, by borrowing the money you have all the control and can do what you want. With a prop firm, you join an LLC, could potentially lose it from the firm blowing up, plus have whatever restrictions they put on you i.e stocks only, intra-day only, can't short this or that, etc. Think about what I'm saying.
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I valued your opinion. Please let me know what you think of this prop firm proposal to me:

1) Starting balance: $15K (My personal account which I'm now net profitable is significantly higher)

2) Initial Withdrawal balance: $18K. You gotta make $18K before you can withdraw $.

3) Profit Sharing: 50%

5) Max Loss: -$1500 Cumulative up to Threshold Amount(including reserve amount).

6) Company shall reduce the nominal account size by $50 every month as a trading expense that reduces the Designated Nominal Account Size for the purposes of calculating, and prior to calculating weekly/monthly performance fee.

7) Weekly withdrawals if have profit of at least $1000

What does 5) mean? I think they said Max Loss will expand as the account gets bigger.

What does 6) mean? Is that like a desk fee?

It doesn't look that great. The only promise is that you can "eventually" trade a $1M of their money. No deposit and full backing. But $15K is very small compare to what I'm trading now on my personal account.


Please give me your thoughts and wisdom on this!

thanks!

trader99
 
trader99 said:
I valued your opinion. Please let me know what you think of this prop firm proposal to me:
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I know you did not ask me, but this is not competitive with your money as first loss and a 50% payout.
 
Maverick74 said:
Yeah if you have first lost you better be keeping 90% or more of your money.
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Sorry, I was NOT being clear. This is FULLY backed prop deal. The $15K is THEIR starting balance. I put $0 money down.

What I meant is $15K of THEIR starting money is still SMALLER than my personal trading account.

So, does the deal still make sense? Please note: I'm NET PROFITABLE in my personal trading account is what I meant to say.

50% seems a bit low by today's standards, but then again I risk nothing..
 
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