Yes, we agree. And whether that means day trading or swing trading is equally true. I am here in this conversation speaking from a perspective of statistics and math relative to combine parameters. You are here in this thread and all other threads speaking from a decided opinion that day-trading is not worth your time and you effort. From there you are merely defending that personal opinion and bias from any angle that seems supportive.
Topsteptrader
- Thread starter deaddog
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Yes, we agree. And whether that means day trading or swing trading is equally true. I am here in this conversation speaking from a perspective of statistics and math relative to combine parameters. You are here in this thread and all other threads speaking from a decided opinion that day-trading is not worth your time and you effort. From there you are merely defending that personal opinion and bias from any angle that seems supportive.
Austin, I'm speaking about just the variance in intra-day data. One of the TST combines requires you to avg $250 a day with a 1k drawdown limit. That is risking 4 times your reward! That is more then enough. How the hell can you or anyone survive in this business if you are consistently losing more then 4 times your profit goal in a given day? I mean that math don't hunt.
Second, the time limit I'm talking about is not the 10 or 20 days but the fact that daytraders are forced by to exit by market close. Not referring to just TST but in general to the guys who carry no overnights and want to be flat by the bell. This means the market can force your hand because it's operating on no time limits but you are. That's not a fair fight son. As long as you correctly estimate the given day's price distribution, not a problem, but if you don't, well then your stops get triggered.
Austin, that is monday morning quarterbacking. Everyone on ET would be a billionaire if they could back out their mistakes. Unfortunately we have to keep those bad choices in the model and round and round we go.
You and others missed my point: the end result was net profitable. Very much so, on a yearly basis.
The fact that it did not meet TST combine parameters is irrelevant to trading success in general. One can pass a combine and fail to be net profitable over time, one can be net profitable over time and never pass a combine with its parameters.
The two are not synonymous. That was my sole and only point
A 50k combine requires +$350 averaged daily result. That's easy as sin in a volatile market and impossible in a dead market. Doesn't matter which symbol, true statement overall.
This is why practically no funded traders have been announced by email lately. The popular markets are mostly flat on an intraday basis. What puzzles me is why Russell 2000 - ICE is not an available choice. If it were, I'd opine a lot more guys would be currently successful to some degree.
Which leads us into agreement with your second paragraph. Day trading can be easy in high volatility and impossible in low volatility periods. No question about it. I agree completely.
So the traders at my firm broke down into 3 categories and this mix is really interesting because it encapsulates the breakdown I think of the entire industry. The first group we had were option market makers (screen based). These guys had an edge. Most (not all) made money. I don't have an exact number and I did not run or manage this group but was good friends with the guy who did. I did know that they drove the p&l of the firm. They had an edge and they consistently made money day in and day out. I should point out that in fairness, they were not killing it. They were getting eaten alive in overhead cost. They had to pay over 12k a month for a seat and we took 20% of their p&l. Their software cost were also around 1k a month. So they made money, but you won't be reading about them anytime soon.
The second group were the ones managing small funds. They made money from the fees and from a cut in the p&l but I should point out, these guys did not have to take big risks and use leverage. The could leverage their money under management vs risk. So in other words they could execute low risk strategies making 10% a year and pull in 7 figures from that vs Johnny daytrader with a small account going all in every day with 50% swings in his account.
The 3rd group were the independent traders. They deposited money and they could trade stocks, options or futures. They could trade overnight, intra-day, whatever they wanted. Most of these guys had no edge and almost none of them made money. Oh they tried. They threw everything including the kitchen sink at the market. In the end as their account values dropped their leverage increased. They would take on more and more risk to try to make back their losses. They would often confuse market environment with edge. In other words like I mentioned earlier, selling options in a rising market or just being long stocks in a rising market and thinking, "look, I found something that works".
So to sum up. The MMs who had an edge for the most part made money. The guys running funds made money but only because they did not have to over leverage and could earn the fees, the independent guys with no edge for the most part lost money. And this is pretty much the breakdown we have overall. We have the flow traders in the industry, the money managers and the guys on their own with nothing. I guess nodoji is in her own little group.
You and others missed my point: the end result was net profitable. Very much so, on a yearly basis.
The fact that it did not meet TST combine parameters is irrelevant to trading success in general. One can pass a combine and fail to be net profitable over time, one can be net profitable over time and never pass a combine with its parameters.
The two are not synonymous. That was my sole and only point
Austin, you can't do that. You are data mining. Fine, you were profitable during that 10 day stretch of data. You can't simply annualize those numbers. You could have easily dropped 15k in the next 10 day period, we will never know but we are not seeing a 12 month non interrupted stretch of data from you. You are "showing the winners".
For accuracy, it's not my setup. I, like many others, discovered it's a positive expectancy setup.
I call it BOPB.
Cornix trades it; he calls it BSOT.
DB trades it; I don't know what he calls it because I haven't studied his PDF yet, but I think the term "RET" is involved.
We either discovered for ourselves through study of price action that it's a positive expectancy setup or we heard about it from someone else and saw that it produced profitable outcomes with relatively small risk more often than not.
I got introduced to the idea long ago from Cornix when we traded together in a Skype group. He never told me what it was at that time, but I observed his trades on the 5- and 1-min chart as he called them and I saw what he was doing.
It appeared four times during Friday's CL pit session and I traded all four appearances of it.
A 10-tick scalper captured 40 ticks profit.
A 15-tick scalper captured 60 ticks profit.
A 20-tick scalper captured 60 ticks profit.
I captured 59 ticks profit from it.
You can continue to make fun of me and "my" Bigfoot unicorn fairy tail setup. Those who exercise contempt prior to investigation may feel smug and get a little ego boost each time they do so, but those who investigate and see the bunnies in the clouds might just enjoy a boost to their trading account.
OK, I think you are coming around here. Since you cannot predict forward volatility, you are vulnerable to that error. Yes, I get it, it was easy to make money in 1999. I was there too. Yes, the same in 2008. But that is not an edge. I get it, 100 handle ranges in ES are fun. But if your p&l breaks down when markets change, well I got really bad news for you. Markets change "a lot". And that is the rub isn't it. If the market could sit still and keep doing the same thing every single day, well hells bells, we be rich. Just like in football, if an offense ran the same play again and again, it would be easy to stop them. Or if a defense ran the same formation over and over it would be easy to score. Life has variance!!!!!!!!!!!! And yes, that makes things a little bit difficult. LOL.
So the traders at my firm broke down into 3 categories and this mix is really interesting because it encapsulates the breakdown I think of the entire industry. The first group we had were option market makers (screen based). These guys had an edge. Most (not all) made money.
The second group were the ones managing small funds. They made money from the fees and from a cut in the p&l but I should point out, these guys did not have to take big risks and use leverage. The could leverage their money under management vs risk. So in other words they could execute low risk strategies making 10% a year and pull in 7 figures from that vs Johnny daytrader with a small account going all in every day with 50% swings in his account.
The 3rd group were the independent traders. They deposited money and they could trade stocks, options or futures. They could trade overnight, intra-day, whatever they wanted. Most of these guys had no edge and almost none of them made money.
I guess nodoji is in her own little group.
As highlighted above from your post, I'm in the group that has an edge and I also execute low risk strategies. My max risk on a trade is 1.2% of my trading account.