Verisimilitude Fund

Quote from Pekelo:

By the way, let me explain again the purpose of the journal, just in case somebody missed the very first post.

I had this idea how to outperform the market in the simplest way possible. I think the idea was/is great, it had 2 flows and I dealt with them.

Now at this point someone could have said: OK, it sounds good on paper, but can it be done? Well, thus this journal was born. Now I apologize to everyone for not having a few millions on my account so I could have used real money, but again, the point here was that just with a few well timed trades it is possible to make 40 or so ES points for the whole year and you only have to be long for the rest of the year, and you already outperformed the market.

And if you do the math, with the original plan if you were right going short, you only need to make 20 ES points (because it counts double, compared to the market) for the whole year, and you are good.

Now how hard it is to make 20 ES points by being short in 12 months??

Probably I should have written a book about it and got paid for it instead of giving it away free here. My bad, I am sorry.... :)
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You don't need millions to trade one contract. I believe it is better if you only use enough money to trade one contract until you prove to yourself that your emotions are under control. Once this is done, then increase to 2 contracts on up as your emotions allow. You obivously have a good method for your trades.

I would encourage you to pursue the course you are on and go to the next level with one contract as soon as you can afford to. Until then, practice like you are.
 
Well, humble1, thanks for the advice and I appreciate that you are trying to help, but let me ask you this. Which one of the followings made you think that I was a newbie?:

1. My 1050+ postcount?
2. The fact that I haven't asked any question in this thread, except some rethorical ones?
3. The fact that I posted 18 winning trades in a row with an 4+ ES points average?
4. The fact that it is impossible for you to know if I trade real money or not, because at least in this thread I haven't referred to it?
5. The fact that I came up with an ingenious way how to outperform the markets?

You see these 5 facts show exactly the opposite. But again, newbie or not, I appreciate the help.

Now what nobody pointed out so far was that I actually overtraded the account and haven't stuck to the plan of being pretty much in the market most of the time as long. I should have much less trades with longer timeperiods, but I got carried away a bit.

The current trade sucks. I made the mistake of going long again my long term indicator without a stop loss, and I got punished. I was planning to get out today if we get a bounce, but the premarket futures are down even more. Well, the interesting part is, that it isn't so bad as long as I keep riding with the market, since I try to mimic it, thus the name of the fund.

The problem arrouses if I let the market rally without me being long, or the double trouble if I short into a rally. Also being flat and the market dropping works for the final goal, which is again, to outperform the market.

So I will see how the day goes and if I see further downside, I will get out with the loss...
 
Quote from Pekelo:

Well, humble1, thanks for the advice and I appreciate that you are trying to help, but let me ask you this. Which one of the followings made you think that I was a newbie?:

1. My 1050+ postcount?
2. The fact that I haven't asked any question in this thread, except some rethorical ones?
3. The fact that I posted 18 winning trades in a row with an 4+ ES points average?
4. The fact that it is impossible for you to know if I trade real money or not, because at least in this thread I haven't referred to it?
5. The fact that I came up with an ingenious way how to outperform the markets?

You see these 5 facts show exactly the opposite. But again, newbie or not, I appreciate the help.

Now what nobody pointed out so far was that I actually overtraded the account and haven't stuck to the plan of being pretty much in the market most of the time as long. I should have much less trades with longer timeperiods, but I got carried away a bit.

The current trade sucks. I made the mistake of going long again my long term indicator without a stop loss, and I got punished. I was planning to get out today if we get a bounce, but the premarket futures are down even more. Well, the interesting part is, that it isn't so bad as long as I keep riding with the market, since I try to mimic it, thus the name of the fund.

The problem arrouses if I let the market rally without me being long, or the double trouble if I short into a rally. Also being flat and the market dropping works for the final goal, which is again, to outperform the market.

So I will see how the day goes and if I see further downside, I will get out with the loss...
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What makes you think I thought you were a newbie? I have no idea. I just reponded to the context of the posts on the thread. BTW, your current trade is a wonderful example of why you should not be trading with a large account. Better to get wiped out early with a small amount then when you get overconfident and get slammed holding a ton of contracts on a good sized loss. Stops and targets should be posted to complete your trading plan. You are about to see why this is important.
 
Quote from humble1:

BTW, your current trade is a wonderful example of why you should not be trading with a large account.
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OK, I will repeat it for the 4th time: The goal of the journal is to outperform the market. If the market finishes the year at -5% and I lost only -3%, the goal is achieved. This is not a daytrading journal, although the first 3-4 weeks showed like that. The reason for that was because I had to build up a little extra gain compared to the market. Now I have 2% cushion.

The only way to mimic (being very similar) the market is to be long. If you figured out a simpler way, I am listening.

So since I want to mimic the market, I have to be long. Now I had the problem of timepremium, but because I made an extra 2% in the first 3 weeks compared to the market, that has been taking care of. So for the rest of the year I can be comfortably long and do absolutely NOTHING, and I still outperform the market. So this current long position doesn't need to have a stop loss.

Sure, if I knew that the market will drop 2-3% in the upcoming weeks, I would get out or go short. But I don't know that for sure. Do you? And my guess of a little bounce up was correct until after midnight, when this latest London terrorist warning took care of the markets and futures dropped another 6 points or so.

Also just a reminder, as I mentioned in the very first post, I can use another unit for daytrading purposes. Thus if I see a few points rally coming, I can average down and go long with a 2nd unit for a few hours.
 
A little explanation. On Wendesday going long was clearly the wrong decission, and I should have cut the losses much earlier.
Nevertheless I was counting on a bounce and although the terror threat took the market 6-7 points even lower preopen (at that time the position was down 15 points) it came up nicely during the day.

If you notice, I managed to get out of the long pretty much at the high of the day, losing only 4 points. Right now I am still bearish, and expecting more fall, probably 10-15 points, so I am waiting if that happens and I can get in long at a much lower level.

If during the day I see a clear pattern I might jump in for a few points, but right now it is just wait and see.

The SPX was at 1.88% this morning YTD. ES is currently 3-4 points below where I got out at 1276...
 
So far I have been right, the market is slowly falling. Right now we are 6 points below where I got out of the longs. Since 12 points is 1 %, I just gained another 0.5% relative to the SPX, supposed I would get in long right now...

As the blue collar guys say: Never underestimate the power of a 3rd grade education!!!
 
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