Sim VS. Real Money trading

I've done a fair amount of forward testing on Ninja with various strategies on both the ES and the NQ and found their simulation algorithms to be pretty realistic.
 
Paper trading teaches a person the mechanics of trading a financial instrument. For example, someone who has no experience in futures should try paper trading to learn how margin maintenance work. It will be good to let him experience first-hand on paper how he can lose money quickly in a bad day.
 
DougStewart said:
Just regarding your 1st paragraph, volpri, just FYI, I have been trading 3 and 4 contract lots using limit orders for entry, and for exit most times, on a Trade Station sim account (using tick charts) all this month [to be specific, exactly 237 trades]. The sim appears very realistic compared with your story above. I often don't get any fill when the market touches my price at first as previously placed orders, or orders of other quantities, are filled ahead of my order. I often get partial fills and have the market price move away from my price, leaving a partially filled order still open awaiting a fill. I have had the market touch my price 2~3 times before I get a complete fill. It seems to just depend on the depth of orders at my price. (I found out I could buy Depth of Orders data for $5/month, but haven't found I really need it, yet.)

I also have placed many market orders. I have found almost always I get filled at the other side of the bid/ask spread, which has almost, but not entirely always, been 1/4 point [I've been trading ES exclusively so far.] The exceptions have been where there was a spurt of price changes.

I'm counting on this sim experience being fairly realistic when I started trading my real $ account around Aug 1st.

I very much appreaciate this thread & all contributors in at least warning me what I'm facing. I will keep y'all posted as I see my results going live.
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That is what i am saying. On a sim orders get filled when it touches your order (whether that be one touch or three touches). But in real trading most of time it is going to have to trade THRU your order by a tick for your order to get filled. There are exceptions but most of the time it will have to trade thru. Yes, you will get filled at your price you have on your the limit order (generally) but my point is price has to trade that additional tick ..thru ...on the entry and on the exit. So, a 1 point gain is going to require a 6 tick move instead of a 4 tick move but you still will only capture your 1 point. Once you go live you will see what I am talking about.

BTW good luck on going live. Perhaps you will be the exception and come out of the gates on the run and win the Triple Crown. But i'd have a backup horse.
 
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volpri said:
That is what i am saying. On a sim orders get filled when it touches your order (whether that be one touch or three touches). But in real trading most of time it is going to have to trade THRU your order by a tick for your order to get filled. There are exceptions but most of the time it will have to trade thru. Yes, you will get filled at your price you have on your the limit order (generally) but my point is price has to trade that additional tick ..thru ...on the entry and on the exit. So, a 1 point gain is going to require a 6 tick move instead of a 4 tick move but you still will only capture your 1 point. Once you go live you will see what I am talking about.

BTW good luck on going live. Perhaps you will be the exception and come out of the gates on the run and win the Triple Crown. But i'd have a backup horse.
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Ahh, now I understand what you're saying. Thanks for your patient explanation and warning. Will try to watch out for this.
 
helpme_please said:
Paper trading teaches a person the mechanics of trading a financial instrument. For example, someone who has no experience in futures should try paper trading to learn how margin maintenance work. It will be good to let him experience first-hand on paper how he can lose money quickly in a bad day.
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Yes that is how to use sim trading. However many sim traders boast about high returns and promote their strategy without forward testing. Which is similar to looking at historical charts and reverse engineer trades for record returns.
Another is a trader who successfully close out a few trade at high returns but have not thoroughly testing their strategy overtime.
Even hot shot hedge fund managers make millions one year and blow up following years.
 
DougStewart said:
Ahh, now I understand what you're saying. Thanks for your patient explanation and warning. Will try to watch out for this.
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there is really not much you can do about it. It is what it is. But it will affect your result in sim vs real money trading. You will see when you go live.
 
Ripping and roaring to go Doug? Getting close. August 1 getting real real close. Is the wife still on board? You gonna post live your trades or just EOD report?
 
volpri said:
Ripping and roaring to go Doug? Getting close. August 1 getting real real close. Is the wife still on board? You gonna post live your trades or just EOD report?
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Wife's still on board. Ready to go. I'll only post the winners :sneaky:
 
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