Trading with a Stop Loss in the Futures Market is for Losers

[galvinlee888]

I agreed one thing, Future trade is not for small account.

I only trade two contract (max) each time in ES, and to be honest, I am making some $$ (average 5-6 ticks each day). I only make about less than 0.2% from my overall account each month with average 5-6 ticks win each day. My account size ? Do your Math.

Do I use stop loss ? Yes, but definitely not 2-3 ticks from my open. Sometime I can't stop laugh when some "guru" (some elite TA expert who never show their trade in real time or some "A"uthor from Amazon hot selling books) claim they have 1-2 ticks Stop Loss and they make $$,

 

[Zr1Trader]

Is it possible for people to open their mind and accept the fact that there is more than one way to make money in the market? Seems like some think that their way is the only way which is a flawed assumption.

I think we can all agree that over leveraging will kill you but that doesn't mean that a method using stops can't make money.

 

[athlonmank8]

Quote from galvinlee888:

Sometime I can't stop laugh when some "guru" (some elite TA expert who never show their trade in real time or some "A"uthor from Amazon hot selling books) claim they have 1-2 ticks Stop Loss and they make $$,

They're probably laughing right back at you. They want nothing more than to see smart asses like you pushing their trades further.

 

[emg]

Quote from athlonmank8:

This thread screams novice. If you need to average up or down because your analysis of the market is sub-par maybe you should find a different hobby.

This isn't a casino. Stops are there for a reason, and like everything else...SHOULD BE USED CORRECTLY.

Instead of worrying about the stop, maybe you should worry about the idiot on the other end of the "buy" button

Don't you think most lose by placing stop?

 

[bone]

Quote from emg:

Those (SMALL TRADERS) that trade with stop in the futures/commodity market are doomed to fail. I

I have never met a trader who didn't have a stop-loss or pain threshold. Now, traders have issues with setting stops too wide or too narrow - that is a reality. But, everybody trades with a stop whether they care to admit it or not. It is ultimately determined by their capitalization.

 

[TsunTzu]

I am 99.99% sure you simply don't know how to trade.

Quote from emg:

Those (SMALL TRADERS) that trade with stop in the futures/commodity market are doomed to fail. I am 99.99% sure, u will lose indefinitely.

Think about it small traders, what is the main reason for the loss or blowing your account? Your stop orders.

Of course, small traders need to place stop due to small RISK capital in the account ($5K. $20K, $50K). Small Traders are taught by 3rd party educational and system vendors to place stop to manage risk and yet they represent more than 90% of small trader lose!! They just lose!!

Force trading, overleverage (trading with more cars) with less capital in the account would make sense to place stop and are doomed. 99.99% u will get stopped out.

Adding to average down is risky if one knows how to do it. Most SMALL TRADERS add to average down/up by every tick or point are doomed to fail and will blow their tiny account ($5K, $10K, $20K, 50K) in no time. THEY WILL FAIL!


Solution:

with $100K minimum in the account and begin to trade 1 car and average down/up 15-50pts against u will minimize risk. For example:


short 1325.00 emini sp 500 on 1 car.

es went against you 20pts. your drawdown is $1000 on $100K account. Is that a lot of heat? U are down only 1% of your account. Is that a lot of heat?

U will go ahead and add and your average price will be 3pts away from the market price. From there u take small profit or loss.

$100K account is equal to $5000 minimum standard to open a futures account and begin trading with 1 car


those that do not have that kind of money should either join the house or should not be trading futures market at all

According to the CFTC:

Commodity Futures Trading Commission Futures and Options trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and options markets.

The risk of loss in trading commodities can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition.


Remember SMALL TRADERS:

More than 90% of small traders lose. They just lose!!!!


I am looking for the best answers Bring them up!

 

[the1]

You are absolutely correct! I have tested this extensively and over time it doesn't matter where you place your stop because they will cause you to lose. If you place it close you get wrecked by randomness. If you place it far away you will get wrecked by one huge loss that wipes out all previous gains. If you search for a middle road you'll quickly learn there isn't one. The answer to the mystery of where to place a stop is it is highly dependent on skill. Trading is a skill and knowing how to use a stop is also a skill. I place my stop well away from the market so I don't get ruined by randomness. It's purpose is only to prevent a disaster. My exits for losses are 99.99% manual. I take myself out of a trade. I refuse to get the market dictate where I exit the trade.

To trade future you need to be well capitalized (a minimum of 50k) and use a small fraction of that capital (no more than 10%) on any one trade. You have to have a lot of respect for the leverage in the futures markets and realize that profits a generated with time. If you're looking to get rick quick buy lottery tickets or learn to play Craps, which is a fun game, btw.

Quote from emg:

Those (SMALL TRADERS) that trade with stop in the futures/commodity market are doomed to fail. I am 99.99% sure, u will lose indefinitely.

 

[FreakofNature]

Quote from the1:


To trade future you need to be well capitalized (a minimum of 50k) and use a small fraction of that capital (no more than 10%) on any one trade. /B]

Aside from tax benefits and around the clock trading what's the point of trading futures if you gonna require 50k to trade a lousy contract.

At the same time, if you only use 10% of your capital, why do you need the rest of the 90% ?

FoN

 

[bone]

This is ultimately a silly discussion in the sense that the trader requires a strategy appropriate for a capitalization level that can withstand several drawdowns in a row. It is actually more about the strategy you use than your capitalization. You can use any strategy you desire trading one-lot futures with $100K. The performance metrics in terms of capital utilization efficiency will likely be mediocre. With a $25K account, however, you will have to have a very well-tuned strategy specifically designed to work with that capitalization level and the optimized use of stop-loss levels will be a major feature.

In the end, too many newbies fund an account and essentially try to learn as they go. What they thought was adequate planning and testing turns out to be very unrealistic when applied in the live markets. And this gets to be very expensive very quickly.

 

[Visaria]

I use stops (more accurately I use stop limits if i'm at the screen and stops otherwise).

I try and cut my losses short.

I try and run my profits.

Sometimes its works , sometimes it doesn't.

But it's always a lotta fun.