Topsteptrader

[endicottsteel]

Thinking ahead to my strategy for the funded trader prep (FTP). The differences between FTP & combine are:

1. The target is much lower $3k compared to $9k combine
2. I must be flat for all major data apart from oil where I only need to be flat for inventories once a week on wednesday.
3. Weekly loss limit of $3k in addition to the $3k daily loss limit
4. Must follow the scaling plan. Start with 3 lots max. 4 at $1501 profit, 5 at $2000 profit.
5. Balance must not fall below Day 10 balance.

With all the above in mind I am going to size initially at 2 contracts on CL with a 30 tick stop = $600 max risk per trade (note I will seldom let the 30 tick stop get taken I cut when I no longer want the position not waiting for the stop). Once I have made 60 ticks = $1200 I will then size up to 3 contracts. Another 60 ticks on 3 contracts will be $1800 to make the $3k target. If I lose the $1200 I make I will scale back to 2 contracts and repeat. Again I will look to make a $200 cushion over and above the $3k if I get to the target in the first 5 days, I will need this to bat out the remaining 5 days as I must trade 10 days minimum. The strategy will have to change if I get to day 5 and have less than $1k in net profit by then. That may cause me to size to a 1 lot and grind out the rest. So I am looking for 127 ticks in oil. This will give me the $3210 gross I am targeting.

CL is going to remain the main instrument as it presents a lot of opportunities for me but also I don't need to be worried about being flat for all the major data releases, just on the wednesday inventory. If I feel CL is not presenting good opportunities next week I will likely switch to the ES and 6E. Again I will look to maintain limits in all of instruments I traded in the combine, I want these clubs in the bag for the live account.

Hopefully if I can start the FTP monday. The 10th trading day will be Monday 4th April and I can submit the FTP for live account approval. I am going to be on holiday April 2nd - 11th so will not be trading then, I will have my laptop though and be monitoring my non top step longer term trades. So I will be available to hit a 1 tick winner on Monday 4th April and submit for approval. Ideally I want to start the live account Tuesday 12th April so will try and keep to this timetable.

 

[VPhantom]

In the end you are trading your own earned money if you succeed as a live trader for tst. So why do you have to follow every rule even when it is just your money at risk ?

Because you're there to get the discipline from their take on what's necessary for success. Otherwise, you'd have opened a small account at AMP on your own.

 

[endicottsteel]

Because you're there to get the discipline from their take on what's necessary for success. Otherwise, you'd have opened a small account at AMP on your own.

Yep you nailed it. Accountability against a defined set of rules. Most unprofitable traders know what risk management is, granted some don't and any in that subgroup are very likely to continue to fail. Having solid risk management rules is one thing but actually adhering to those rules is another. Unprofitable traders will say things like, why did I break my own rules? or they will then look to shift the blame to protect their ego or change the rules and break them again instead of looking inward. the cycle continues. The fact is if you trade for a firm you have red lines that if crossed mean you are done and out the door. Let's say I take a grad (which I am not going to do!) and he is on demo for a month then i start him on a 1 lot live. Day 2 he clips a 2 lot and offers no satisfactory explanation as to why he did it. he gets canned. end of. That same person trading from home, will continue on 2 lots, then do 4 then 8 eventually sooner or later they will blow out.

Look out for the tell tale signs of unprofitable traders.

* do not accept total responsibility for their actions (something that is very prevalent in our modern society)

* look to pass blame, its the rules, the system, the algos, the markets changed etc.

* do not follow rules whether they are someone else's rules or their own rules.

couple that with being undercapitalised where you trade with fear and it's guaranteed failure and donation to the stronger players and market makers.

Topstep has sensible risk management rules in an accountable environment and it removes the fear of being undercapitalised. It's a great business model for both the owner and customer imo.

 

[ScalperJoe]

The problems with theory that it doesn't work in practice. You didn't adjust for size. If he used 15 cars in the Combine and only 3 is allowed in the first 10 days, you have to divide your numbers by (let me get my calculator) oh yes, by 5.

So instead of 18K, that is a 3.6K cushion in the Live account, assuming similar results. Or did I miss something?

That's why I also included the following in the post:

"Of course, any trading that differs from the combine vs. the live account will skew the results for the Day 11 balance."

 

[ScalperJoe]

In the end you are trading your own earned money if you succeed as a live trader for tst. So why do you have to follow every rule even when it is just your money at risk ? And would TST really pull the plug on a profitable trader if they broke one of the rules but is still net profitable ? If the answer is yes that proves that their real intention is just a combine money grab.

If you get past day 11 and carry a positive balance, then you're trading the built up equity using THEIR maintenance margin. Also, there's the ability to scale up size without adding capital. Two rules that get eliminated are the weekly loss limit and trailing max draw (on day 11). Since you cannot go below the "zero" starting balance, the trailing max draw IS the equity!

Whether TST would "pull the plug on a profitable trader if they broke one of the rules" is subjective. According to the current rules, it states the following: "Once your cumulative profit is greater than $5K, you can request adjusted risk parameters."

So a trader at $5k net would probably want to negotiate rules that conform to their own game plan if they felt any of TST rules were prohibitive.

 

[endicottsteel]

Trade report updated overnight. No response yet from TST on starting the FTP, I guess it's going to be Monday now. GW.

 

[volente_00]

Because you're there to get the discipline from their take on what's necessary for success. Otherwise, you'd have opened a small account at AMP on your own.

So how does TST offering $100 mulligans enforce discipline in the combine ?

 

[endicottsteel]

Day 10 update - received confirmation from Topstep that my combine was passed and go ahead to start FTP. They must be up early in Chicago! Starting the FTP monday. It says in the email if I fail the FTP I will go back to the combine and they will give me the 1st month of a $150k combine for $1. GW.

 

[VPhantom]

So how does TST offering $100 mulligans enforce discipline in the combine ?

What's a mulligan? Do you mean the resets? The average participant takes the $30K combine which is $150. The reset fee is barely cheaper than starting a new one fresh, for those people. Also, notice that a reset doesn't move the monthly billing date, so at best this is a gimmick to allow people to do 2 combines per month instead of just one, and given that there's about 21 trading days in a month, I don't see that as a way to forgive bad discipline but as a way to participate full-time instead of half-time.

They probably should've made it 60% or 75% of the monthly fee, instead of flat $100 for all 5 levels, but that's just one of the numerous mysteries about their business decisions. Plus I doubt anyone would spend it on the $150K which is already very pricey for what it offers.

 

[Xela]

What's a mulligan? Do you mean the resets?

I had to look that up. It seems to be a pinball expression: "happens when a player gets a second chance to perform a certain move or action; usually due to lack of skill or bitter luck. A "Do-Over". Like getting an "Extra Play" in pinball due to sinking the ball before obtaining an arbitrary amount of points" (Urban Dictionary online!)

The average participant takes the $30K combine

I didn't know this. I see a lot of people getting funded from $100k/$150 Combines, so I suspect that it's perhaps one of those "averages" that conceals a bimodal incidence, i.e. some (perhaps the more successful ones, overall?) taking $150 and a lot more taking the $10k? There must be loads of people taking the lowest one, if the average equates to the smallest-but-one out of five, anyway?

The reset fee is barely cheaper than starting a new one fresh, for those people.

I suspect they're comparatively few. The mulligan-fee is low, for those on higher Combines.

Plus I doubt anyone would spend it on the $150K which is already very pricey for what it offers.

Indeed. I suspect a significant proportion of those taking the $100k/$150 Combines may comprise those whose trading methods necessitate scaling-in/out, and therefore needing (or at least preferring) be able to trade the 3-lot minimum as per the scaling-plan, when funded? I'd certainly need to do that, myself.