Why do 5% of Traders Win?

cornix · Feb 29, 2012

Quote from BCE:

Hi I've got to get back to my other work, but I discovered your trading blog earlier and see you made some good money shorting the Euro. Is that right? Good for you. Wish I was a silver trader and caught that move. And gold got creamed today too.

Here in California it's 8 PM. I guess in Russia it must be Thursday morning around 8 AM. Is that correct?

Yeah, European session was a mess, daily had double inside bar so it was apt to breakout and Bernanke started it.

Managed to take part of the run.

Thursday, 11:20AM here right now. Spring already started for us here in Siberia.

Brass · Mar 1, 2012

Quote from NoDoji:

...I'll continue to trade to the short side until a key support level is reached, tested twice and holds...

Just curious. Aside from immediately preceding price action, how often have you found more distant ("key") S/R levels to have useful informational value? I well understand the theory behind it, but for every instance where a past S/R level apparently has an effect on immediate price action at around that price level, I can find another, equally "valid" example where it does not. And so, I question its usefulness.

NoDoji · Mar 1, 2012

Quote from Brass:

Just curious. Aside from immediately preceding price action, how often have you found more distant ("key") S/R levels to have useful informational value? I well understand the theory behind it, but for every instance where a past S/R level apparently has an effect on immediate price action at around that price level, I can find another, equally "valid" example where it does not. And so, I question its usefulness.

I use protective stops in case setups fail. The setups I trade reach a minimum profit target more often than not (60% or more of the time). There is no way to predict where price will go with certainty.

Brass · Mar 1, 2012

Quote from NoDoji:

I use protective stops in case setups fail. The setups I trade reach a minimum profit target more often than not (60% or more of the time). There is no way to predict where price will go with certainty.

I have no argument with any of those statements. I'm only suggesting that most "key" S/R levels don't seem to pass the balance of probability test.

cornix · Mar 1, 2012

Quote from Brass:

I have no argument with any of those statements. I'm only suggesting that most "key" S/R levels don't seem to pass the balance of probability test.

I know, you asked NoD, but this matter is interesting, so I decided to join the discussion.

Levels are basically the only 100% objective points on chart, where we know for sure, that supply/demand balance changed.

Levels on big charts (daily+) for sure are watched by many eyes, including eyes of someone moving big money.

Less so intraday levels, but that's still the case.

And final note: for me personally, price action around level is the key factor, not the level itself.

cyoungmark · Mar 2, 2012

I think the 5% are able to predict, or have some kind of sense to the markets. Obviously if your a algo trader you are already part of the 5%.

oldtime · Mar 2, 2012

or the whole notion that 95% win and 5% lose is total bullshit. Just another myth propagated by emg and other losers.

more likely, it is 50/50 depending on what time frame you are using.

achilles28 · Mar 2, 2012

Quote from Lucias:

.. I AM one of the best at what I do which is trading the zero sum futures game, predicting the market in advance, etc. I claim a comparative "best" but not an ABSOLUTE best. I know there are traders, running HFT systems that smoke anything I could do but again I don't compare myself against them.

Many people who have discovered a truth and found the world not to believe them end up going crazy/mad/etc. I am beyond and above that.

achilles28 · Mar 2, 2012

Quote from Lucias:

bhardy... this is NOT true. Not absolutely true.. all my records should be treated as hypothetical and MOST of my gains are on the hypothetical only. However.. what you claim is NOT true either.

Facts

* I had a subscriber for approximately 3 months taking majority of my trades. I was traded at least an 50k-80k account. I know because I opened many cars up overnight which wouldn't have been possible otherwise. I didn't know he had signed up because I turned off the notifications but I had seen my orders go through and knew they were mine: don't ask how. I estimate that I made him around 12k over 3 months. This is an estimate. I asked him for a precise number but he didn't keep good records and couldn't answer me. I checked my results to his real money results on 2 days and his results were inline or better. He eventually quit. I would like to have known exactly how much he made but neither of us know.

* When I started my journal here, it was a real money account at NADEX. I think I said that. Sometimes I joke about trading paper because paper is dollars too.

* I have taken some real money trades on my systems.. just a couple with ES futures. This is provable. I have had also subs taking my trades with real money which is verifiable.

* It is true that I've only traded a micro account. It is true that I wish I had my gains last year in real money. That's all true..

2 whole trades? Slow down, Big Guy. You're gonna break the bank.

Tell us more of your "paper account". I just want to make sure I got all the "facts" straight....

achilles28 · Mar 2, 2012

Quote from bhardy307:

Ok Lucias, but you're always talking so big. I think you're doing yourself a huge disservice.

Please reread my last post. I edited it.

No, no. You're wrong. YOU GOT IT ALL WRONG.

Lucias knows some of the top guys at the biggest firms. A certain Wall Street market maker (don't ask him which one), offered to buy his C2 "crack pipe" algo for a cool 10K, but DR Steenerburger said given his unnatural talent could easily fetch 60K after making a couple minor tweaks (...like upping the Sharp ratio by a couple points.. and what not). There's a rumor going around that Traders Monthly plans to back Lucias in the next Robbins Cup! He'd blow away the competition, that I'm sure of