Topsteptrader

[volente_00]

When a company's business model is opaque, we can only go by what can be seen. What you have failed to notice is that we are FOR the traders, and every criticism what we bring up here is in the interest of traders and if TST is helping traders it is also in their interest. Just ask them, they have been eventually implementing our suggestions for years!

Now I don't want to sound such a Debbie Downer all the time, so I will repeat one of my older suggestions, that is good for both Live traders and TST. But first let's share a sad story from Chef Morin (more about him later):

http://www.stocksforexfutures.com/how-to-handle-failure/

Long story short: Hard working chef finally makes it to Funded Trader, puts orders in before unemployment numbers release, gets blown away and quickly loses the funded account. A hard lesson learnt in a very quick way.

Now even he acknowledged it was all his fault, he broke the rules. That is not the point. The point is what Abraham Lincoln said:

"What can be automatized, should be automatized, specially in the 21st century."

Yeah, he really said that. So that is one thing if we agree with TST's rules or not, but if they are already there, why don't they help poor traders and make sure things like the above example doesn't happen? Is it really that hard to kick out everybody automatically from every positions before any scheduled news releases?

Now I hear you, you are going to bring up the "it builds principle" BS defense and they should be punished for breaking rules. You know what, I kind of agree to a point, so here comes my idea:

OK, TST doesn't like traders trying to trade economic news releases. Fine. But why kill poor trader right on the spot? After all he spent months and money to get where he is, and chances are he could make money for TST, not just for himself.

So the idea is, instead of revoking Funded trader status for such violations, why not automatize the system, but still punish them (after all we are building character and following principles and such) in a much more economic way of making them pay FINES.

Now we can argue how much the fine should be, 50 or 100$ or whatever, that is not the point. The point is that a trader doesn't lose Funded trader status, thus he can keep earning money for TST, he still gets punished and TST gets extra money not to mention TST doesn't lose money during the violation. After all that loss for chef Morin was also a big loss for TST.

So programming getting everyone out of positions before releases AND market close makes everyone happy, saves money for everyone there is simply no good argument why it shouldn't be done. And the fines make sure the trader will remember and hopefully learn.

If I were a Funded trader I would rather pay fines a few times than being kicked off of my hard earned Live status.

OK, TST are you listening? Just follow Uncle Lincoln advice and do the right thing for the 21st century...

No charge for the idea, I am a nice guy after all....

At least the Chef has the right attitude.


"The one defining characteristic of successful traders is their refusal to quit in the face of adversity"

 

[endicottsteel]

Well, you're certainly entitled to your opinion. However, if TST wants traders to "exercise strict risk management" then it's flawed logic to have it in the live account and NOT in the combine, since the process is designed to build,as you say, "strict risk management."

Like volente posted, it's a set up for the probability of failure. ES trades much thicker than crude. The majority of live traders are trading CL. My guess is more would trade ES is if wasn't for the limitations.

No it's not flawed logic Joe. TST does want traders to exercise strict risk management. The combine has less strict rules than the FTP it's a progression into the stricter rules. If they had the strictest rules from outset even fewer would make it through.

Saying it is set up for the probability of failure is flawed logic. It is set up as a business to earn money for the owners whilst providing a genuine service that is the true position. What you are saying effectively is because TST have all these rules that must be adhered to and the majority of people fail to take a cheque then it is setup for the probability of failure. That is flawed logic.

I can guarantee you if you had a combine with NO rules only daily loss limit and profit target the vast majority of people would still not be able to pass it. What you are concluding is that because the vast majority of people cannot trade profitably and TST has rules (whatever they are) that TST is setting traders up for the probability of failure. This is incorrect. TST is setting up the opportunity for traders in an activity which is extremely difficult, 98%+ are going to fail at this with TST or without TST.

If you look at most high performance coaches in sports/business/trading you will find that taking 100% of the responsibility of results is something that the individual needs to do early on to move forward with achievement of goals. What I am saying is blaming the rules or saying the rules are setting people up to fail is going to be a losing attitude. The TST rules are there, they are not unfair, yes they change time to time but ultimately to make it in this business you need to take full responsibility for adhering to those rules.

 

[endicottsteel]

If traders want proof that TST is a viable business model, then just keep track of those who are actually making money in their live accounts. The latest email shows many funded traders posting $1k daily gains.

Nobody is going to say it was easy, however the opportunity surely does exist. Of course, it would be great if TST simply provided the correlation of the Day 11 equity balance to the combine traded. Then anyone who is viewing TST can make an informed decision regarding the expected value of the return on their combine fees, and proceed with their own game plan.

So you want to know the correlation of the Day 11 equity balance to the combine traded. It's bound to be a high positive correlation isn't it if we are talking about the subset of people who make it to Day 11 live. Of course it is likely that those trading the larger combines will have higher Day 11 equity balances, do you think they would have less for some reason? Let's say they provided you with this dreamed up stat you are looking for and it came back that the result was people who take the larger combines go on to have higher Day 11 balances. Would that really allow you to make an informed decision on expected value? of course not. The expected value is more a function of the traders ability, experience, discipline, psychology & market understanding.

Look a trader isn't any more informed on the expected value of their return because you would know this correlation. The expected value is pretty much zero for the vast majority and they are going to lose money trading with TST in combine fees or without TST to the market. There are no restrictions on who can take a combine, no filter. Literally a homeless alcoholic could enter if they could pony up enough money to enter. So you have an activity that is extremely difficult akin to high level sports and no filter on who can attempt it. The expected value of most peoples return is zero. or $0.00001c. The allure of trading is such that people think that anyone can make money at it or because someone told them they are 'bright' or 'street smart' they think its a valid career for them. The reality is it's not going to happen for 98%+.

The true nature of trading is lost on most of the retail populous. It's a competition. Pull 10 people off the street at random you have to be the 1 in 10 of those that destroy the other 9 in all aspects just to have a shot. Then take that 1 person and put them against 99 other highly disciplined / educated pro traders. That person needs to be in the top 5 of those 100 to make serious money imo. I reckon the success rate with no filter taking anyone is 1 in 100 maximum.

 

[endicottsteel]

Day 5 down on the farm. just hit a +1 tick winner on ES. This time next week I will be submitting the combine for approval. Of course the only thing that matters is the live account performance. The FTP target of $3000 seems very doable compared to the $9000 combine target albeit with a few extra rules thrown in. GL

 

[VPhantom]

Then anyone who is viewing TST can make an informed decision regarding the expected value of the return on their combine fees, and proceed with their own game plan.

I agree that clearer communication from TST would help.

I strongly disagree with your point, however: other people's results have no correlation whatsoever with your own. None. You should know what your trading plan's worth (per lot) before you start spending money on combines, anyway, or else it's just a game of luck.

You're basically saying that if you could just get the tools that (insert any famous trader's name here) has at his disposal, you'd be expecting the same returns. I'm sorry, but no.

 

[ScalperJoe]

I agree that clearer communication from TST would help.

I strongly disagree with your point, however: other people's results have no correlation whatsoever with your own. None. You should know what your trading plan's worth (per lot) before you start spending money on combines, anyway, or else it's just a game of luck.

You're basically saying that if you could just get the tools that (insert any famous trader's name here) has at his disposal, you'd be expecting the same returns. I'm sorry, but no.

Ok, time for some clarification. I've stated repeatedly that there are only TWO questions a trader has to ask themselves:

1. Can I pass the combine?
2. Can I develop enough equity in the live account to take decent checks?

Of course each individual's results will vary! The point of having transparency with the correlation of equity to combine passed will simply provide a reality check to traders who think they're going to "get rick quick" with a 1 lot account. It's simply to separate fantasy from reality. A trading buddy just mentioned today that he heard the owner say that traders make very lofty projections when they start. This is no different than the equity prop world, where pikers pony up $2k-$5k for a live account and believe they will soon have a positive cash flow making a decent income given the 20x leverage.

 

[ScalperJoe]

Of course it is likely that those trading the larger combines will have higher Day 11 equity balances, do you think they would have less for some reason?

The expected value is pretty much zero for the vast majority and they are going to lose money trading with TST in combine fees or without TST to the market. There are no restrictions on who can take a combine, no filter.

The larger combine traders will have higher Day 11 equity balances and thus have a higher probability of utilizing the scale up plan. I've never disputed that, in fact I've mentioned that repeatedly in prior posts.

The combine has rules and restrictions that a live (retail) account doesn't. If one trades successfully utilizing those rules and restrictions and transfers that discipline into a live TST account, then there should be a positive expectancy of outcome in the live account (knowing that since the rules change in the live account, that expectancy will decrease if they can't adhere to the new set of rules). Of course, this is also provided they build enough equity in their TST live account by Day 11.

This of course doesn't mean that a currently profitable live trader will never "blow up" their account, at TST or retail.

 

[ScalperJoe]

Saying it is set up for the probability of failure is flawed logic. It is set up as a business to earn money for the owners whilst providing a genuine service that is the true position. What you are saying effectively is because TST have all these rules that must be adhered to and the majority of people fail to take a cheque then it is setup for the probability of failure. That is flawed logic.

I can guarantee you if you had a combine with NO rules only daily loss limit and profit target the vast majority of people would still not be able to pass it. What you are concluding is that because the vast majority of people cannot trade profitably and TST has rules (whatever they are) that TST is setting traders up for the probability of failure. This is incorrect. TST is setting up the opportunity for traders in an activity which is extremely difficult, 98%+ are going to fail at this with TST or without TST.

Read my post again. IF you are trading ES in the combine, where there are NO restrictions regarding market moving events, and now you are a live trader, where you MUST follow the 18 specific news events, there is a greater probability of making a mistake that violates the rules. I've never advocated no rules and in fact I'm in agreement with many of the TST's rules, just not this particular one.

And yes, if one trades with a different standard of rules in the combine vs. the live TST account, then it's a set up for failure. This is why it's better to follow the SAME rules of the LIVE account when one trades the combine.

Regarding "flawed logic" I was referring to the fact TST has different rules for each level (combine/FTP/live), especially if the key is to build "strict risk discipline" as you mentioned.

And yes, of course there would be less traders passing if the live rules were the same as the combine! However, posting the # of "funded traders" who passed a simulator is just a marketing tool. As many have already stated, it's only the LIVE account that matters.

It's good that TST has been narrowing the gap between the different rules of the combine and live account.

 

[Pekelo]

If traders want proof that TST is a viable business model, then just keep track of those who are actually making money in their live accounts. The latest email shows many funded traders posting $1k daily gains.

That is a silly argument (posting only winners) and a scampish pr move on TST's behalf. Sure we hear about Jim's great Monday when he made 2K, but we never hear about his Tuesday when he lost 3K.

Without a longer time frame (Jim made 10K in January, for example or even better he made 30K in 3 months) those posts are only good for drumming up business.

At least the Chef has the right attitude...

...but not the stamina. If he is evaluating swing trading of stocks chances are he is not with TST anymore. That would be 2 blow outs in 3 months...

 

[Pekelo]

I couldn't fail to notice the lack of any good argument against my idea in your post.

I simply don't agree on every point. Business model is clear.

I wasn't even criticizing their business model in that post. I was giving them a useful idea how to save money by not letting traders blowing out by accident, how to make extra money by fining them.

The Chef's example was just a sample, and that incident lost TST 2K or more in a few seconds. Now why would they want that happening repeatedly when it is completely avoidable? If humans can not be trusted, well, let's not to trust them. That's why we have machines.

If Joe is right and there are 18 events weekly to monitor when not to trade, that is way too many and just another good reason to implement my idea. I don't think there are more than 2 scheduled important events weekly for each instrument, but that is another matter. If TST wants to avoid more events, that is just more reasons to automatize...