UK Scalpers

[Scientist]

Quote from Baruch:

So why are you trading Dax when there are so much profit in the Bund?

Because for the size I'm currently doing as a small retail trader, the DAX is just fine - and A LOT MORE profitable because of volatility and entry opps. Profit is relative. That prop dude averaged 3.5T/day = E 35/day per contract, a bit more than 1pt/day on DAX. I wouldn't be remotely happy with that. In fact, I'd give up trading.

However, clearly if I want to trade 50 contracts a pop, I will have to look for different media of expression.

Right now, this isn't my main concern though. I love trading the DAX. You can trade bund if you like.

 

[sptrading]

You are right, it's around 4 ticks per day but don't forget that generally, it cost 3 or 4 levels of depth to execute his size and he liked to enter all his size at once. Some days, him alone was doing 3% of the daily bund volume.

 

[Scientist]

Quote from sptrading:

You are right, it's around 4 ticks per day but don't forget that generally, it cost 3 or 4 levels of depth to execute his size and he liked to enter all his size at once. Some days, him alone was doing 3% of the daily bund volume.

Well, look at Mark / velocity_trader who does over 20K contracts/month. Didn't someone say he averages about 0.5-1% of total DAX volume? Amazing!

On the other hand, on a contract like DAX that trades ~100K/day, that's only 500-1,000 contracts traded. So if you're trading 10 cars/click, that's only 50-100RT a day. Any active scalper can do 100RT and more. I can. I just am not doing that kind of size yet. But might be soon, who knows.

And how about the liquidity problem, anyway? I have found that my particular style tends to become wobbly beyond about 5-6 contracts on DAX. But how about the fact that more active traders also add liquidity? For example, you couldn't really say that Mark "steals" 1% of daily DAX volume, because he actually contributes that volume. If he wasn't trading, the volume wouldn't be there.

So, I think we have to talk in terms of traders having a "share" in volume, rather than "taking" a certain amount of volume, as often seems to be implied. So your bund dude actually did 3% of the daily volume because he went in there and quite possible made the market ~3% larger. Not because he controlled or took out the volume in some way.

Am I getting this all wrong here? Any thoughts?

 

[Scientist]

Quote from sptrading:

You are right, it's around 4 ticks per day but don't forget that generally, it cost 3 or 4 levels of depth to execute his size and he liked to enter all his size at once. Some days, him alone was doing 3% of the daily bund volume.

Oh, apart from that - You have a point in liquidity being an issue with such size - But do you think that displaying and trading such size may also have advantages to it, like scaring and manipulating other players? Clearly, if you're a big fish in the pond, the view's a little different to being an unseen nobody.

 

[sptrading]

He wasn't displaying the size, just lifting offers or hitting bids. The year he made 25m, he didn't try to scare the market, he was just in the zone, in perfect sync with market (I can tell that I know I will never see something similar in my life; there were days you thought he had received the intraday chart in his mailbox). The quarter he lost 8m, he was much less in sync and was very often trying to scare the market by executing his size at once near the high or low of the session or near crucial S/R levels.

 

[Scientist]

Quote from sptrading:

He wasn't displaying the size, just lifting offers or hitting bids. The year he made 25m, he didn't try to scare the market, he was just in the zone, in perfect sync with market (I can tell that I know I will never see something similar in my life; there were days you thought he had received the intraday chart in his mailbox). The quarter he lost 8m, he was much less in sync and was very often trying to scare the market by executing his size at once near the high or low of the session or near crucial S/R levels.

That's interesting. How about false size display games though? Wouldn't that be easy for a player like him to constantly load the opposite side of the market he wants to trade and then pull the size once he's in, like many large players do, particularly on bund? It's the old "pull the carpet" game.

I would love to be able to play games like that, but then wonder if it might not be pretty dangerous, too. A friend of mine, also a prop trader, told me he used to trade smaller issues at times, being the "big fish" in the market, but then it often backfired, too. Now, he says, he'd rather be a small fish in a big pond than a big fish in a small pond anyday. I think he's got a point. Any thoughts on that?

 

[zdreg]

Quote from Stratcat:

Hello Monkey,

I actually work at the biggest arcade in London, I also know people who trade of have traded at Atlas, GHF, STI, and Kyte. I've only skim read the posts in this thread but here's the deal if you're asking for info. I'll only speak for what happens at where I am as I shouldn't comment on the others.

Traditionally we have taken on all sorts, although over the last couple of years the emphasis has moved more towards graduate intake. Everyone here has a different style of trading and there is no training so to speak. They do provide a course on economics but economics are irrelevant in daytrading except for understanding how comments by Fed, ECB members, etc. will effect the market. The trainees then spend 6 months on a simulator and are paid a pittance whilst they gain this experience just to keep them going.

Once you go live you pick a contract such as Euribor, Bund, Bobl, Schatz, Gilt, T-Note, Eurostoxx, etc and focus on this with small size slowly building up your account. If you lose money the company take the hit until they lose faith in you and you have to leave. Hopefully this doesn't happen though and you go along increasing your size as you improve.

For this chance you pay £1750 a month plus extra for any additional support you may want. You also obviously pay the commission fee for each round turn. The company will also take a percentage of your profits usually 40% for the first two years and then you renegotiate as you spend more time there. I moved to 75%-25% in my favour after my second year.

The costs may seem steep at first when you're trading 1 lots but a year down the line when your throwing 400 lot clips around in Euribor or 150 in the Bund, your whole desk rent for the month is simply the price of 1 tick.

So this is how it works. It is a huge fallacy that the majority of daytraders fail. Maybe this holds up for the people trading at home but we have hundreds of traders in London alone and I've only ever seen about three people leave because they weren't profitable. Don't get me wrong it's not a licence to print money and I have struggled myself but you never know who will be good at this job. Many of the most successful traders I know are people actually not very bright and one of the people that had to leave the company was a chess master. And that's the thing about daytrading it's really just a big computer game, you don't need a brain and the more you try to work out what is happening, the more likely you are to fail. Go with the flow.

Just as an example, the guy who sits next to me started trading as a novice with us 18 months ago, he's been trading live for just over a year. He makes £150k a month and does 120k round trips a month. (which means a rebate of over £20k on top of your p & l)
Another of our guys who started at the same time has done significantly better and has had a couple of £100k days, he clips 1000 lots each trade.

These boys are exceptions though, I myself after 2.5 years have only had moderate success and last year made about £50k. It took me quite a while to become profitable and then three weeks ago I lost £65k on the nonfarm payroll number wiping myself out in the process. And I'm a trader that has never had a big hit in my life. So if you go down this avenue, you must be prepared to take the rough with the smooth in equal measure.

The point is, you never know until you try. I have seen guys lose money every week for a year and almost get sacked only to be given another chance and a year later they are absolutely flying making £50k a month. The truth is though that almost everyone here does okay and the only limitations are the ones you set on yourself.

If you are interested in trading for a company like us let me know more about yourself. I don't have anything to do with the selection process but I will gladly give a cv to the head of training if you're suitable. You've shown a bit of initiative in finding out the names of some of the prop firms in London and they like that. Do you know how I started in this job? I met an old LIFFE floor trader in a pub and he was impressed with my enthusiasm and got me an interview. The rest was down to me. Before then I was at a guitar college and had never heard of futures trading.

This is my first visit here (looking for inspiration after the nonfarm trade) and if anyone is interested I will post here regularly and give readers a real taste of a trading day in London, it might be interesting to see how the experience differs from the guys trading at home.

what is the name of your co.
thx.

 

[zdreg]

Quote from Stratcat:

Hello Monkey,

I actually work at the biggest arcade in London, I also know people who trade of have traded at Atlas, GHF, STI, and Kyte. I've only skim read the posts in this thread but here's the deal if you're asking for info. I'll only speak for what happens at where I am as I shouldn't comment on the others.


what is the name of your co.
thx

 

[okwon]

Quote from Stratcat:

It took me quite a while to become profitable and then three weeks ago I lost £65k on the nonfarm payroll number wiping myself out in the process. And I'm a trader that has never had a big hit in my life.

Ouch! How did you lose on that nonfarm? It was such a blowout number, 1K. Did you accidentally hit the wrong side?

 

[cornholetrading]

Quote from zdreg:

Quote from Stratcat:

Hello Monkey,

I actually work at the biggest arcade in London, I also know people who trade of have traded at Atlas, GHF, STI, and Kyte. I've only skim read the posts in this thread but here's the deal if you're asking for info. I'll only speak for what happens at where I am as I shouldn't comment on the others.


what is the name of your co.
thx

IF it is Macfutures they should have an office somewhere in Australia if Scientist was interested.