Quote from thisisnotsurfer:
Speaking of trends, how has the trend following tribe been doing lately? some making money, some losing money as usual, does anyone have the stats???
http://www.elitetrader.com/vb/showt...ighlight=trend+following+delusion#post2212880
tins
Here is a past example pushed by a trainer, repaiman for traders.
The repairman is named Steenbarger. He video tapes clients and then rehab's them with respect to their nager, anxiety and fears.
He uses a model from a ighter pilot trainer. OODA. It is a betting based approach
His client is trading 60 times a day.
the client uses 400 cars a trade.
The net profit per contract per trade is a little less than a tick net.
Dave you can run the numbers. you could interview this guy and find out wht Steenbarger has a retainer agreement to treat this guy continually.
Look at his money velocity. Put yourself in the trader's place. Would you be angry, anxious and fearful.
24,000 turns are done a day and the net per is a little less than a tick.
Say it is 5 bucks net per unit for Steenbarger's client. Mr black od turning 250 bucks on 20 ticks with 1 car.
The client is running 400 times the capital of Mr Black and pulling 5 bucks a turn and MR black is pulling 250 a turn doing a turn a day instead of 60 like the client.
The client makes 10 to 12K a day on unlimited capital (that is how it is put by Sttenbarger).
Obviously the guy is maxed out and only making a small net per trade. How could he make less. The smallest would by a tick divided by 400. He is getting almost a tick on average where 5 bucks is a tick.
This is a LOW money velocity.
The trader is given capital for margining 400 contracts. He does 60 trades a day with 400 cars and makes 10 to 12K a day.
T28 has 50K and it will be traded 20 the 40 times in a day like those 15 trades yoiu saw yesterday (Okay you didn't see them because your mind cannot let you).
What trade (its number in the order of trades does T28 watch his money pass 10,000. Divide 10,000 by 50 (the cars that will be in use) and divide again by 50 (the value of a point in ES) and divide by the points in the average of those 15 trades yesterday (use 1 since it is small and less than the real value. It is trade 4. We have 11 more to go. 4 into 11 goes a few times. Now fill in the rest of the day. Call the fifteen trades half the day since they were less than half.
I have to stop trading T28's 50K at about 20 trades into the day if I only pull a point a trade. LOL....
The client of Steenbarger is his numero uno trader client. Steenbarger makes a living coaching guys like this. You don't know the client as you have said in the past.
Money velocity is foreign to you and so is how high velocity traders trade.
Hwo many contracts deo Mr Black need to match the client? Divide 250 into 10,000. 40 contracts doing one 20 unit trade a day. What if Mr black does 4 trades a day? Then he makes 10K with 10 contracts.
What is the risk of trading trends, each of whicch which has three moves in a known annotatable order of events. the trends overlap and they have the same pattern long of short. the pattern occurs over and voer many times a day (I showed five as the day unfolded for part of a dya)
So you need a vocabulary. You need to learn to listen. Stop blowing off people who can trade with your comments that tell them you know nothing.
Don't ask a trader what his money velocity is. Say this: don't those partial fills get you? don't they fill your print so fast, you run out of paper priting them at the end of the day?
Steenbarger's client really has a problem cause his IB is making so much money....no he isin't thay have a seat he trades through at his office....lol.. But he only gets a little less than a tck per car on one of 60 turns a day.
Lets see the last 6 trades including now are: short long short; long short long....... and they are running 2,3 and 4 points each. Here we go loooong (Bar 69)...... See the ask WALL.....
