I agree, the point that I was trying to make was that even if you can buy at the bottom (which I know is impossible), it could be very hard to see 80% of your profits evaporate before the next run up.
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Risking 10k to make 1.25 mil. Anybody trades like that?
- Thread starter tyrant
- Start date
I agree, the point that I was trying to make was that even if you can buy at the bottom (which I know is impossible), it could be very hard to see 80% of your profits evaporate before the next run up.
Actually, as someone who does go for large profits on trades several times a year there is logic to the idea of waiting for really good setups and doing your best to let the profits run. Your math skills are rather ludicrous though. In order to make 50 points or more multiple times a year you have to be willing to hold overnight. Since $10k lets you hold 1 single ES contract then compounding your winnings over thee 50 point trades would take your account from $10k to $22,500.
To make at least your posted number would in fact require 16 consecutive 50 point wins with never a loss and always maxing out your leverage.
To make at least your posted number would in fact require 16 consecutive 50 point wins with never a loss and always maxing out your leverage.
Quote from opt789:
Actually, as someone who does go for large profits on trades several times a year there is logic to the idea of waiting for really good setups and doing your best to let the profits run. Your math skills are rather ludicrous though. In order to make 50 points or more multiple times a year you have to be willing to hold overnight. Since $10k lets you hold 1 single ES contract then compounding your winnings over thee 50 point trades would take your account from $10k to $22,500.
To make at least your posted number would in fact require 16 consecutive 50 point wins with never a loss and always maxing out your leverage.
500 ES contracts for 50 points = $1,250,00
one tick on ES 500 contract is $6,250.00 margin required on IB will be 1,237,500.00 ($2,475 per contract Intraday Maintenance) to open the position he will need $1,547,000.00 ($3,094.00 Intraday Initial).
So...
He needs to pick the bottom within 1-2 ticks with 500 contracts and $1,547,000.00 in his account to open the position at IB. Keeps his cool till he gets 50 points.
This will be the mother of all trades. I had a similar trade with much fewer number of contracts. They way it happened is I closed my short position using too many contracts and I was long without realising. Few days later I was surprised to see that one of my managed accounts had a big profit. Closed the position and went to buy good wine. But I can't believe an average trader will have the guts to pull this type of trade.
I been trading long term commodities for 24 years, what works for me is finding the tops/bottoms, but I use options to hedge. Unlike the Crude Oil which took me 26 tries to find the high last year, if only took two tries to buy 3/5 and Mondays' close in S&P's. Yea, I make some really large profits when I nail them, rest of the time I try to recover enough on the options to breakeven or make profit on overall position, and there are times I lose on both futures and options. Then are the times I see 10k go all the way back to breakeven, but I have to trade my backtested rules. Something is always going to lose for me, my way for most would be a depressing way to trade, but it works for me.
On any one trading idea though, I never risk more than one percent of my account, trading is all about RISK.
But the oods of take 10k to 1.25mil on 3 trades on Emini ES is like impossible. Margin restraints would be the factor, overnite at $4500
And if you find trading to be tedious, it is not the career you should do, find something that gives you passion, something you can't wait to do each morning, overwise your career will be more of a prison.
Handle
On any one trading idea though, I never risk more than one percent of my account, trading is all about RISK.
But the oods of take 10k to 1.25mil on 3 trades on Emini ES is like impossible. Margin restraints would be the factor, overnite at $4500
And if you find trading to be tedious, it is not the career you should do, find something that gives you passion, something you can't wait to do each morning, overwise your career will be more of a prison.
Handle
As I said above, it's a typical "noobian" fantasy.Quote from ivanbaj:
He needs to pick the bottom within 1-2 ticks with 500 contracts and $1,547,000.00 in his account to open the position at IB. Keeps his cool till he gets 50 points....But I can't believe an average trader will have the guts to pull this type of trade.
Quote from opt789:
Actually, as someone who does go for large profits on trades several times a year there is logic to the idea of waiting for really good setups and doing your best to let the profits run. Your math skills are rather ludicrous though. In order to make 50 points or more multiple times a year you have to be willing to hold overnight. Since $10k lets you hold 1 single ES contract then compounding your winnings over thee 50 point trades would take your account from $10k to $22,500.
To make at least your posted number would in fact require 16 consecutive 50 point wins with never a loss and always maxing out your leverage.
I said I wanted to risk 10k, not that I only have a 10k account.
Quote from ivanbaj:
500 ES contracts for 50 points = $1,250,00
one tick on ES 500 contract is $6,250.00 margin required on IB will be 1,237,500.00 ($2,475 per contract Intraday Maintenance) to open the position he will need $1,547,000.00 ($3,094.00 Intraday Initial).
So...
He needs to pick the bottom within 1-2 ticks with 500 contracts and $1,547,000.00 in his account to open the position at IB. Keeps his cool till he gets 50 points.
This will be the mother of all trades. I had a similar trade with much fewer number of contracts. They way it happened is I closed my short position using too many contracts and I was long without realising. Few days later I was surprised to see that one of my managed accounts had a big profit. Closed the position and went to buy good wine. But I can't believe an average trader will have the guts to pull this type of trade.
My intended stop is 10 pts. I do not need to get it right within 1-2 ticks. I am going for 3 "all out" correct trades. Eventhough I do not have 1.5 mil, I have quite a sizeable account. So, margin is not really a probelm because I can scale down a bit. That's just an example. And needing a 1.5 mil acccount to do it only sound rsky but in fact, I am just risking 10k.
Let me ask you this question. If margin was not a problem, does it make sense for you to do this type of trades?
Someone mentioned psychological problems. While I agree that it is hard, what matters is is it ultimately viable? If it is, why not?
And referring to such trades as noobian fantasy obviously reflects on poster's own inmaturity right?
Some say imagination is more powerful than knowledge.
If you're going to take extreme risk, it may be better to do it in the Forex markets because the only really large gaps you'll see will be during the weekend. The rest of the time, the Forex markets operate 24 hours a day. I don't want encourage anyone to take large risks but I do know that the JPY has a tendency to trend better than other currencies. You can try the Dealbook 360 demo from GFT Forex which has amazing charts (godlike, really, I'm not kidding). The EUR/JPY I find sometimes has larger moves but it has a higher pip spread than the USD/JPY. But, pip spreads of two, three, four or even five pips won't be too much of a factor if you try to capture 100 to 300 pip moves.
I'm still on demos myself until I get the hang of it.
P.S. I looked at the 2002 to 2003 period and I saw you did see rallies during that time that lasted maybe about 1 month to 2 months. Those rallies were sharp but tanked rapidly as well. Other alternatives might be FAS, UYG or URE. Those ETFs are priced low enough, they're like options with no time decay. However, the rally in my opinion has already begun.
P.P.S. I know people here think that it's "noobish" to think you could risk everything and make a big buck. But, your idea made me think of the possibility of opening a Forex account to do longer term trades.
I'm still on demos myself until I get the hang of it.
P.S. I looked at the 2002 to 2003 period and I saw you did see rallies during that time that lasted maybe about 1 month to 2 months. Those rallies were sharp but tanked rapidly as well. Other alternatives might be FAS, UYG or URE. Those ETFs are priced low enough, they're like options with no time decay. However, the rally in my opinion has already begun.
P.P.S. I know people here think that it's "noobish" to think you could risk everything and make a big buck. But, your idea made me think of the possibility of opening a Forex account to do longer term trades.
Then you should go back to English class because you wrote âIf one starts with an initial stake of 10k.âQuote from tyrant:
I said I wanted to risk 10k, not that I only have a 10k account.
If you risk $10k on 10 ES points, as you seem to be claiming at this point, then by definition you are using $10000 divided by $50 per point on ES divided by your 10 point stop = 20 ES contracts. If you are using 20 contracts then a 50 point gain is $50k. Obviously 3 of those will not get you anywhere near 1.25M.
You seem to have no idea about the English language or any idea how to do basic math. Maybe you should restate your question again and think about it before posting.
p.s. thanks to mod that moved this to chit chat