Using broker statements to get a trading job?

[logic_man]

Quote from ocean5:

The market would never ever say to anyone that the stop should be 50 points lower.Can you please explain how that could be or what you look at to get this idea?

Never say never.

Seriously, who are you to dictate to the market what is and isn't a valid stop? Unless you are God Almighty, you don't have that authority.

I've also had initial stops 3.25 points away, so it's not as if they are all 50 points away to start, that was just an extreme example.

You have to listen to what the market is telling you, not what you want the market to be telling you or think the market should be telling you.

Think of the market as a dream. A dream has its own logic and when you are awake you might think to yourself "Man, that was a fucked up dream I had last night". Well, the market is that fucked up dream and unless you let it take you where it wants to go, just like that dream, you are unlikely to succeed as a trader. I don't know if I'm telling you something you don't already know or not, but what I am telling you is the absolute truth.

 

[the1]

Don't tell them it's coded. Tell them it's discretionary and based on an intuitive read of the markets.

Quote from southbeach4me:

You try to get a job as a trader at a firm, they will without a doubt, ask you for the code to your strategy to "make sure it fits their business model" and then they will STEAL it and they don't need you anymore. You're better off trying to raise cash(couple hundred thous) via a rich friend( attorney, doctor, etc) and starting a small hedge fund.

You take your profitable ES strategy to a firm,......U can kiss it goodbye!

 

[logic_man]

Quote from ElectricSavant:



P.S. I think a trading statement would be the best addendum to your resume, but try for a DD of no more than 15% in year two....you can do it....go for perfection.

Yes, this is doable, but would require small bet sizes and lead to lower returns. As I mentioned, with a mere 1% at-risk per trade, the strategy would have returned nearly 50% over the past 10 months with ~5% max drawdown. Given that the market is basically flat over that time period, I'm pretty sure that a 50% return would be most welcome.

 

[bwolinsky]

Quote from logic_man:

Yes, this is doable, but would require small bet sizes and lead to lower returns. As I mentioned, with a mere 1% at-risk per trade, the strategy would have returned nearly 50% over the past 10 months with ~5% max drawdown. Given that the market is basically flat over that time period, I'm pretty sure that a 50% return would be most welcome.

I don't consider a system that will only average down scalable according to the institutional definition. If your strategy will only average down this is averaging down, because that strategy would not be consistent with the algorithm that produced the initial entry.

BTW, there is no linear relationship between price and time.

 

[logic_man]

Quote from bwolinsky:

I don't consider a system that will only average down scalable according to the institutional definition. If your strategy will only average down this is averaging down, because that strategy would not be consistent with the algorithm that produced the initial entry.

BTW, there is no linear relationship between price and time.

It's not that you can ONLY average down. You could very well choose to average up, although that would decrease the size of your average winner and increase the size of your average loser. Since there is a lot of room to do that before the strategy became strictly break-even, one could very well scale it up that way. It would be a somewhat subjective preference as to which scalability method was chosen. One of the reasons I would choose scaling up by averaging down is that I know the likelihood of the initial stop being hit is very low and that the likelihood of the trade, even if it takes initial heat, becoming profitable is very high. Absent those empirical facts, I would not choose to average down because I do think that it is, in general, an inferior strategy.

Under one specific set of circumstances that I've found, the future relationship between price and time from that moment on is, at a probability greater than chance, linear. At an indeterminate ("indeterminate" from the point of view of the trader entering the trade) point in the future, the relationship will cease to be linear and that is when I exit. It could lead to a one tick gain or a 30+ point gain (and, of course, losses. I never have claimed it's 100% accurate), depending on how long the linearity lasts. I guess you could say that it's "linear enough" or perhaps "quasi-linear" (I think this is the best description, actually). Outside of that one set of circumstances, I have no strong opinion on the linearity of the relationship between price and time. Since that set of circumstances only occurs once every two days in the ES, for example, it certainly would enable someone who was a casual observer of the market's movements to become convinced that there was no linear relationship between price and time, since most of the time, there might not be. It's akin to trying to find a needle in a haystack. If what I was doing was immediately obvious, it probably wouldn't work. You could never get to where I am looking at anything that's ever been written about trading (not that I've read everything ever written, but I've read a fair amount). What I am doing has never been written about in the public domain, although there is a non-zero probability that some other trader has discerned the same setup somewhere out in the world.

 

[doublet83]

My sense is that while your results are impressive, a year of history is likely not enough to land the types of jobs you are looking for. However, this will largely depend on your ability to sell your strategy as something unique and innovative, making them believe that these great results are sustainable. Also, it will depend what else is on your resume. Furthermore, it will be very relevant to them to know how much capital you've been trading with. Although your point that it shouldn't matter given the liquidity of the instrument is logical, it is just naturally a lot more impressive if you've been making millions. While if you've made less than 100k I imagine they will immediately have a disparaging attitude towards your results.

My guess is that you're overestimating the value of personal trading histories in landing you a good job on Wall Street. Here is my experience, for instance.

I've been working at two smaller hedge funds as an associate level analyst for about 4 years after college, doing fundamental research and making about 100 to 140k range. In 2009 I got laid off, but not for performance reasons.

Since then I've been trading my own account. While I stopped looking for work now, I spent some time trying to apply about 6 months ago. At that time I had made about 550k trading and investing in my personal account, representing a 400% cumulative return over 2 years, with max DD of about 10%. I think you'll agree that those are pretty nice results.

I added that experience to my resume and attempted to look for similar type work to what I had before: an analyst role at a fund making about 100 to 140k. I did not imagine this was too much to ask for giving that's basically the role I had before, plus I have this nice personal trading record. I was wrong.

My results didn't really impress a lot of people. Part of the problem for me was that my trading history wasn't deemend relevant to landing a research role. At the same time, my trading history was no where near impressive enough to land a portfoilo management role.

So while your situation isn't quite the same as mine, I would warn you that the market right now is still tough, and employers see tons of resumes with great personal trading histories. They are inherently very skeptical of them. If you have a great resume to complement your trading, you'll be okay though.

 

[logic_man]

Quote from doublet83:

My sense is that while your results are impressive, a year of history is likely not enough to land the types of jobs you are looking for. However, this will largely depend on your ability to sell your strategy as something unique and innovative, making them believe that these great results are sustainable. Also, it will depend what else is on your resume. Furthermore, it will be very relevant to them to know how much capital you've been trading with. Although your point that it shouldn't matter given the liquidity of the instrument is logical, it is just naturally a lot more impressive if you've been making millions. While if you've made less than 100k I imagine they will immediately have a disparaging attitude towards your results.

My guess is that you're overestimating the value of personal trading histories in landing you a good job on Wall Street. Here is my experience, for instance.

I've been working at two smaller hedge funds as an associate level analyst for about 4 years after college, doing fundamental research and making about 100 to 140k range. In 2009 I got laid off, but not for performance reasons.

Since then I've been trading my own account. While I stopped looking for work now, I spent some time trying to apply about 6 months ago. At that time I had made about 550k trading and investing in my personal account, representing a 400% cumulative return over 2 years, with max DD of about 10%. I think you'll agree that those are pretty nice results.

I added that experience to my resume and attempted to look for similar type work to what I had before: an analyst role at a fund making about 100 to 140k. I did not imagine this was too much to ask for giving that's basically the role I had before, plus I have this nice personal trading record. I was wrong.

My results didn't really impress a lot of people. Part of the problem for me was that my trading history wasn't deemend relevant to landing a research role. At the same time, my trading history was no where near impressive enough to land a portfoilo management role.

So while your situation isn't quite the same as mine, I would warn you that the market right now is still tough, and employers see tons of resumes with great personal trading histories. They are inherently very skeptical of them. If you have a great resume to complement your trading, you'll be okay though.

Thanks for the input. I think it's less that I'm overvaluing personal trading and more that I don't know if any value is placed on it. It sounds like it would be minimal and even then only if accompanied by some other experience that qualified you for a gig. Hey, I know that if some trader tried to get a job with some of the consulting companies I'd worked for, they'd be mighty cautious about hiring him, even if he came across as a sharp guy, so I can see where they are coming from. No point in hiring someone who's more risky when there are a lot of pre-qualified applicants looking as well.

 

[doublet83]

Yeah, I think it best to have low expectations when landing one of those coveted wall street jobs right now.

Keep at it, if your strategy keeps performing, even at a fraction of your historical returns so far, you may have built something very valuable. While my risk adjusted returns have been off the charts, a lot of it comes from a strategy with limited scalability, where as your strategy has no such issues.

I'm sure there will be areas where a successful personal trading history will be valuable, but the history needs to be long enough for people to believe that you have something sustainable.

 

[thesniper]

Quote from logic_man:



Think of the market as a dream. A dream has its own logic and when you are awake you might think to yourself "Man, that was a fucked up dream I had last night". Well, the market is that fucked up dream and unless you let it take you where it wants to go, just like that dream, you are unlikely to succeed as a trader. I don't know if I'm telling you something you don't already know or not, but what I am telling you is the absolute truth.

LOL......that was a great analogy.

 

[dealmaker]

Quote from logic_man:

Has anyone tried this and succeeded? I've developed an algorithm for the ES and have had 8 months of profitability with a gain of 196% and a max drawdown of 26%. I've been optimizing it and it could have been even better. Clearly, if I can continue at that rate, I won't necessarily need a job, but I'm wondering if I could land one using that as my "resume". It'd be nice to trade OPM, so I could put even more emotional distance between myself and the outcomes. Also, having the technical resources of an established firm behind me would enable branching out into other markets, which I am dipping my toe into now. The algorithm "should" work in any market which fluctuates, which is pretty much all of them, although, of course, that needs to be verified.

No chance whatsoever!