Did you figure out why? You didn’t execute live trades as well as your paper trades? Or it’s a completely different thing with live trading?
Two Questions For Practicing Day Traders
- Thread starter ironchef
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Did you figure out why? You didn’t execute live trades as well as your paper trades? Or it’s a completely different thing with live trading?
@Bad_Badness, I misspoke. Went back and review the details of trades, actually both on paper and live, the average # of trades per day were about the same, 28 per day for paper and 25 per day for live.
@Bad_Badness gave you the correct answer...
..
Trade style is irrelevant. The focus should be on Discipline. Discipline to take the system(s) signals/triggers whatever they are, whenever they occur.
As a US-index futures daytrader, flat eod, my daily expectation is far different from yours.
IOW, IT DOESN'T MATTER FOR YOUR SUCCESS, AT ALL!! In fact, it doesn't matter to ANYONES success, other than mine!!
When I first started out, the formative years when I was still developing my style and groove, I used minimum wage 40-hour week work earnings as a MONTHLY goal. Today, ironically I had a flashback of this period... Long story short, one my first trades way back when, produced over $300 profit. One trade. One of my first trades. One day-trade. Monthly goal, done! Fortunately, this caused me to study more. What was different about this trade vs other trades? I quickly realized and immutably embedded into my memory that you can only gain from what the market offers. Up, down, sideways, doesn't matter. If it ain't there, you can't get it from there. And hence, my predilection to scalping/intraday swing was born.
The above is free... maybe a nugget, maybe not.
Good trades to you.
A couple of questions
Are you trading futures or stocks.
If futures are you trading indexed or other
Are you trading all day
Are you trading the USA trading. Session
When you say paper trade.. Is that in real time or using historical data
Toucan
which time i went live? i would have to break each out as they were all different.
or i could break it down by accounts and clearing firms or better yet while trading at the cme using a membership clearing account.
so you don't get one shot get that outta your head. it's not that people can't learn to be great traders it's that they run out of money before they figure it out.
So question 1 is moot, is the new assumption.
So Question 2 then: Expectation is too coarse a measure. It uses probability of W/L. In order to get a meaningful number you need too many trades, e.g. > 30. That is too coarse for what you are trying to learn now. You want to drill down into each trade before measuring dozens of trades.
Imo a day trader should use "High and Low water mark" intra trade, what is called MFE and MAE, and then add time in market.
You see examples of this: you get into a trade and it lasts way longer than normal. If it is a winner, grand slam, then ignore it. But if it is not, and is either a BE or small gain, or loss or large loss, then there are problems:
1) you are protecting the expectation (both probability of W/L and the actual W/L) number by holding onto bad trades. Sort of metrics slight of hand.
2) the trade takes too long and is not being closed and opening another trade, there by reducing the total number of trades. You miss better trades.
Try this metric. MFE/MAE/Time. Some platforms do it for you. They record each trade MFE and MAE and total time in market. Something to consider when choosing a platform.
Then WHEN you have a POSITIVE, $/minute metric. Get that number high, then work on orders handling to get the more profit. The expectation number over many many trades will be fine and reliable.
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follow the trend the trend is your friend
all friends leave so you should be able to recognise when a move is overstretched in any one direction.
it took me 20 years to learn this.
so you do not get in the end.....
markets hate strong moves.......big bars mean non sustainability. market hates big bars.
novices love big bars because they think it is fast money. simple mismatch which leads to disharmony......
moves without base end because smart traders know it will end and they will be fading every tick.
but if the big bar is so big to be a spike, watch for a channel........a channel is a correction and all corrections do end...oops! well almost all. some just develop into a trend in the opposite direction
Welcome to the fianancial markets.... every minute is a wonder
all this may sound to be off topic but it is connected to your first question how many trades? you can make 1000 a min if what you do makes sense....
all friends leave so you should be able to recognise when a move is overstretched in any one direction.
it took me 20 years to learn this.
so you do not get in the end.....
markets hate strong moves.......big bars mean non sustainability. market hates big bars.
novices love big bars because they think it is fast money. simple mismatch which leads to disharmony......
moves without base end because smart traders know it will end and they will be fading every tick.
but if the big bar is so big to be a spike, watch for a channel........a channel is a correction and all corrections do end...oops! well almost all. some just develop into a trend in the opposite direction
Welcome to the fianancial markets.... every minute is a wonder
all this may sound to be off topic but it is connected to your first question how many trades? you can make 1000 a min if what you do makes sense....
Regarding profitability I do not go by percentages as I do always trade the same sizes, varying only by how convinced I am by the PA I see. I recently posted about the most beatuiful double bottom I have seen in the ES (1hr db with 5min db in each "leg"), it's situations like these I go full balls deep. That means size is 20 but I never go beyond that. I take 4-20 trades a day depending on how many opportunites there are
1. Typically, 1-2 trades a day. Maybe more if one turns out to be a big winner.
2. Not sure how to answer this but when I'm profitable on the day, I typically make about 3% of my account size. At the same time, my risk/reward ratio is very favorable as well. For instance, I bought the 3 /MES contracts yesterday at 4246 with a 10-point stop loss. I got out at 4350. That's like a 9 RR. This return on this trade was a little less than 10% of my account size. Like another poster said, I don't really go by percentages. I usually find a trade meets what I'm looking for in a setup, that fits my RR and that I can make at least 5 times my risk on.
2. Not sure how to answer this but when I'm profitable on the day, I typically make about 3% of my account size. At the same time, my risk/reward ratio is very favorable as well. For instance, I bought the 3 /MES contracts yesterday at 4246 with a 10-point stop loss. I got out at 4350. That's like a 9 RR. This return on this trade was a little less than 10% of my account size. Like another poster said, I don't really go by percentages. I usually find a trade meets what I'm looking for in a setup, that fits my RR and that I can make at least 5 times my risk on.
I also look at my metrics in regards of R and not percentages of capital. My typical day is four trades and I shoot for a 2r+ a day. In a month I would have about 10 day's ending + 2r and the rest of the month day's cancel each other out. So, realistically, I average about +20r a month, 200r a year. Year in year out. It is the consistency that for me is the important part of the results I get. I do everything to keep a good work ethic and be disciplined every day... I only trade the first hour. I only take trades that are in my tradingplan. I quit trading after 4 signals or if the results are more then + 2r for the day. (I do not cut off a winning trade)
All this works for me. I trade for a living, I do not live to trade. Big difference. I see a lot of people get in to daytrading and it is for most people an alternative for Vegas. The get there dopamine from seeing a possible trade and get hooked for life, whatever the results are financially... I really belief that 90% of daytraders are in that category.
All this works for me. I trade for a living, I do not live to trade. Big difference. I see a lot of people get in to daytrading and it is for most people an alternative for Vegas. The get there dopamine from seeing a possible trade and get hooked for life, whatever the results are financially... I really belief that 90% of daytraders are in that category.