Recommend to trade for a living ?

Street Trader said:
Here you go

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Let me offer you several observations:

1. I assumed the returns were cum returns, and that each division was one week's data. Overall if you can consistently get a 12.5% monthly return, that is outstanding results that very few of us can obtain consistently. Even though it is just a demo account, it is very very good. My suggestion is you should run the demo for a few more months to see if the results still hold, if so you may have a workable system.

2. I want to offer a word of caution too. Most of your gains were from 3 out of the 12 periods. The other periods you did not make any profits or incurred small losses. You need to dig down and find out if those gains were due to trading skill, chance or just riding an up market. If your system is robust, I would expect the gains to be more evenly spaced, independent of market condition?

3. Realizing that >95% of traders failed, you need to know when to hold and when to fold.

Best wishes.
 
>3. Realizing that >95% of traders failed, you need to know when to hold and when to fold.<

I often think to myself that from a young age we start trading, we trade baseball cards with others, trade chores for other chores, money for stuff, and yet when I started, I really sucked at it for number of years learning day trading. And yet I look from time to time of the things I was doing back then, and they all make sense to me now. 95% lose cause they quit, they feel overwhelmed, they know they can't be disciplined enough for whatever reason, but maybe it is cause they dream too large. Last week I ave $19.10 net on each ES trade I did, doesn't sound like much for all the years I been doing this, but those who trade will say $19.10 is huge. What is large was the risk as all trades risk over $100, but that is day trading for me when you Scalp.

Signals, best signals can be explained in a short sentence, if it takes more than that, not going to be easy to remember.
 
Handle123 said:
>3. Realizing that >95% of traders failed, you need to know when to hold and when to fold.<

I often think to myself that from a young age we start trading, we trade baseball cards with others, trade chores for other chores, money for stuff, and yet when I started, I really sucked at it for number of years learning day trading. And yet I look from time to time of the things I was doing back then, and they all make sense to me now. 95% lose cause they quit, they feel overwhelmed, they know they can't be disciplined enough for whatever reason, but maybe it is cause they dream too large. Last week I ave $19.10 net on each ES trade I did, doesn't sound like much for all the years I been doing this, but those who trade will say $19.10 is huge. What is large was the risk as all trades risk over $100, but that is day trading for me when you Scalp.

Signals, best signals can be explained in a short sentence, if it takes more than that, not going to be easy to remember.
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In all due respect Handle, I often wonder about it myself. It is a damn challenging intellectual exercise to try figure things out.

Short term trading is a negative sum game (zero sum to the counter parties - commissions and slippage) so we cannot all be profitable. Also, short term the market is "almost random". If the market is completely random, then it is like gambling, no day traders can consistently make money. But there are some non random components there and so there are a few, like yourself who figured it out and can consistently make money. But not all of the traders can make money trading, even if it were the same players day in and day out, like a poker tournament.

The following chart tells the story:

upload_2016-12-18_20-4-57.png


The green histogram is a random distribution of the 1 day price distribution whereas the small red histogram depicts the actual SPY histogram that is different from complete randomness. The SPY behavior is not completely random but the differences are awfully small and I for one am not smart enough to figure out how to exploit it and find a consistent winning day trading strategy.

I welcome your comments.

Best wishes.
 
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ironchef said:
In all due respect Handle, I often wonder about it myself. It is a damn challenging intellectual exercise to try figure things out.

Short term trading is a negative sum game (zero sum to the counter parties - commissions and slippage) so we cannot all be profitable. Also, short term the market is "almost random". If the market is completely random, then it is like gambling, no day traders can consistently make money. But there are some non random components there and so there are a few, like yourself who figured it out and can consistently make money. But not all of the traders can make money trading, even if it were the same players day in and day out, like a poker tournament.

The following chart tells the story:

View attachment 169014

The green histogram is a random distribution of the 1 day price distribution whereas the small red histogram depicts the actual SPY histogram that is different from complete randomness. The SPY behavior is not completely random but the differences are awfully small and I for one am not smart enough to figure out how to exploit it and find a consistent winning day trading strategy.

I welcome your comments.

Best wishes.
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Firstly no market is random, choas yes, random hell no, more choas in longer term trading, why I day trade.

If you look around you'll actually see short term people are doing much better than long term, full on scalping is too extreme and performs poorly.

Long term have good runs while on the right side of the market, then give it all back, but big up the profits and hide the losses, why it seems long term is better, it isn't.
 
Turveyd said:
If you look around you'll actually see short term people are doing much better than long term, full on scalping is too extreme and performs poorly.

Long term have good runs while on the right side of the market, then give it all back, but big up the profits and hide the losses, why it seems long term is better, it isn't.
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Just an observation but when you say 'look around' do you mean on trading forums and social media. If so you will rarely find anyone admit to being a losing trader. The majority of traders at these venues claim to be consistently profitable. My own view is that the vast majority of them are not being truthful for a host of commonly known psychological reasons.

Secondly from the small number of consistently profitable traders I have met and/or worked alongside in real life the timescale of their trades has not been a factor. I know of short term traders who do very well and longer terms traders who wouldn't dream of putting on a day trade.

What I did notice though is they had some common traits.They were all outwardly humble people who didn't get involved with social media. They were very flexible independent minded not ruling anything out or in. I also noticed that they were quietly very competitive minded which would overlap into non trading activites.

GL
 
Trading for a living makes a lot more sense when you have an account at least 5 times larger than what you need to live one for one year and the money you are trading with are primarily from profits already made in the market. Until that point you can keep a full time job and swing trade - like the rest of us have to trade our accounts up. This way you are building on some level on success and have a chance to make it mathematically.
 
lylec305 said:
OK, what is correct then?
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Traders fail because they exit too quickly to take substantial profits .The best gains are made by doing nothing , letting your winners run.

When you are folding . you have no idea of a top or end of trend , so you cut your profits .In fact the best results are achieved by doing nothing.Traders closed their profits on amazon stocks , 350% lower.
 
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