S/R Emini Journal

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Quote from 4re:

I totally agree with him. I get PM's all the time from new traders wanting to get into futures the first thing I do is explain some of my trading method and then let them know how difficult the futures market really is.
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... and the real reason there is such a high failure rate amongst aspiring traders is the dearth of knowledge and information about the diffrent products, which, combined with the low barriers to entry lead to catastrophic failure.

And every good trader who has figured it out for themselves are simply not willing to share the goodies (not that there is or is not anything wrong with that).

So every new trader has to literally reinvent the wheel, build the car, and learn how to drive all by themselves all over again.

... and if they can't, they become yet another statistic.

JJ
 
Quote from brandon12:

I've been reading theses notes for a while and the info is very good. But the reality is most people keep about 20-30k max in a futures account. With 30k you can control 60 contracts max on day trading.
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Hi Brandon12

Thanks for posting, but I have to tell you, with 30K you can control more like 6 (5k performance bond per) to an absolute maximum of 15 (2k performance bond per) contracts trading futures ... and that's if you stick to intra-day trading.

But this is what I mean by dearth of knowledge and experience. It's a path that requieres time, and once you have it, you have to add a method that is consistent and delivers a positive expectation (and then you have to learn it), and sufficent money management skills to implement it ... but traders don't wanna be the turtle they have to try to be the hare (it's human instinct).

Best,

JJ
 
Quote from JimmyJam:

Hey fellas, how's it hang'in?

While you make very good points, the truth of the matter is that Stocks, Options, Curriences and Futures, while they may look the same, are actually all very different animals.

I was great at stocks, and even put together portfolios for friends of mine, but when I transfered over to futures it took a long-time for me to put together something that makes sense to me, and now that I'm attempting to do it again, using a different processes in public, while it is easier (the learning curve is much faster) trading leveraged products period, is a thing unto itself.

Comparing the different methdologies of trading is like comparing trail riding with equestrian (my favorite) with wild horse bronco riding (thought might appreciate that analogy, Tex).

While they are all done on a horse, they are completely different disciplines.

Rainy days.

Later,

Jimmy
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You are right they are different animals but the charts are the same. And eminis are for sure the bronco of the horses. But before any cowboy learns how to ride a bronco he must first learn to saddle a horse (read charts) then ride a horse (trade stocks) then if he is so inclined ride the bronco. The only thing I modified in my futures trading from my stock trading was the time period I hold and setting a specific goal. I only did that after watching the market for a while and losing for my first couple of months. Then I started doing this way and have never changed. If I ever get to sell my company and retire then I will trade longer timeframes in futures and hold to major S/R instead of minor ones.

Thanks for analogy that I understand. I grew up cowboying and riding the rodeos. Saddlebronc and bareback. My nickname from my parents was Bronc because I was a wild one. LOL...
 
jj i'm not understanding? I and most on here have $500 per contract day trading margins on the es. So with 30k i can trade up to and hold 60 at a time intraday.
 
Quote from brandon12:

jj i'm not understanding? I and most on here have $500 per contract day trading margins on the es. So with 30k i can trade up to and hold 60 at a time intraday.
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If you try to trade that $500 performance bond you'll blow out within a month (tops). You need to structure your thinking based not on what you have to win, but what you have to lose from entering any given trade ... and then you need to give yourself time to master your methodology.

While there are some guys who can make a go at it with $500, they are literally 1 in 100, or 1 in 1,000. The rest are going to take a pratfall ... one bad trade could wipe you out ... one lost connection, one market stop that gets hit and doesn't fill quickly enough ... one halt on the markets ... one bad fill ... one hesitation, etc. etc., etc., (and I've experienced every single f*#@!#$!! one of them).

Use the performance bonds that I suggested for the longevity of your trading account, and keep trading SIM until you understand why.

Best Regards,

JJ

P.S. Those $500 margins are a gimmick used by retail brokers to wipe newbies out, it's nothing personal, it's just business.

P.P.S. Hell, you don't believe me, ask Gary. BTW he made it work with those $500 performance bonds - but the question is do you think you can? For the record, $2000 is not enough for me, I like $4,000 per (but I'll take the $2000) ... because I know I can't.
 
Quote from brandon12:

jj i'm not understanding? I and most on here have $500 per contract day trading margins on the es. So with 30k i can trade up to and hold 60 at a time intraday.
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JJ is more than right on this one. The more margin you use at one time the less likely you are for success. You do have 60 trading bullets for any one day but I would suggest never using more than 1/4 of those in one day which would be 15 and I would split those in half meaning 7. Only after you have started out small with 1 and start showing a small profit for a couople of months. Then slow increase to 2 then 4 and so on. Remeber, survival first then trader.
 

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LOl no offense jimmy but i've been full time trading over 8 years and people on here do use there $500 margins.So if you trade 6 contracts on a 30k account you'll be lucky to do 50% a year.Also nobodys keeping over 30k in an uninsured futures account especially after the refco fiasco so i guess making a living on 30k is impossible unless you're telling me trading 6 contracts on a 30k account you can make 100k a year or 300%?
 
Gary i agree with all what you and jimmy have said. One should not trade over 6 contracts with a 30k account. Which brings me to my main pt. If you can make 30k on a 30k account each and every year thats 100% on your money which makes you a superstar investor. Which brings me to my whole pt. It's foolish to think one can make a living with a 30k account and unfortunately 90% of people are drawn to futures because of the low amount of capital required and the dreams of riches
 
Quote from brandon12:

I've been reading theses notes for a while and the info is very good. But the reality is most people keep about 20-30k max in a futures account. With 30k you can control 60 contracts max on day trading. All will agree to take 30k to 60k in a year is a 100% and a hell of a year. The problem with futures it's not really scalable to the fact very few people will go from 10 lots to 20 to 30 to 40 to 50 lot size as or should i say if there accounts grow will they do it. You're whole trading style and reactions will change trading 10 contracts vs 50. $2500 a pt with 50 contracts changes peoples reactions to loses. Like gary even though most of your trades work you might be down 3/4 of a pt first before it works and on 50 contracts thats over $1700 which to many people would scare them out of the trade. Also many people never leave over 30k in there futures account. My pt is how many people really believe they can do 100-200% every year? so if you make 30k on a 30k account every year you're one of the best investors around. No different than a stock account with 200k. If you can make 200k every single year you're one of the greatest investors alive.I think many people read this thread and think"man these guys are nailing 90% of there trades and i can take my 30k account to 200K" . Experienced traders know thats not true. But gary you've done a good job and spent a lot of time on this board
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I don't agree with a word you say.

What you say may be true to some, but it is really a psychological issue.

Part of the challenge once you have a positive expectation, is can you handle the increase in contract size at every different level and the psychological challenge of that. And also does it affect your trading?

I have known people that couldn't trade beyond 30 contracts because they felt uncomfortable with the tick size.

But, to assume everyone won't be able to handle it is simply incorrect.

I have personally known traders trading anywhere from 150 contracts to 1 contract.
 
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