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Old Jul 31st, 2005, 02:59 AM   #175
guy2
 
 
Join Date: Sep 2003
Posts: 654
Quote:
Quote from nononsense:

How long will it take to turn a $5,000 account into $100,000?
A bit more than a month (if you double your money every week).
I know that you're joking nononsense but you got me thinking extreme stuff:

Some brokers allow you to day trade a margin of $500 per contract so that means you could trade 10 ER2 contracts with $5,000 start capital. Now if you take a look at the Daily Notes page you will see that the 10, 20 and 40 day average ranges for the ER2 are 10.36, 10.51, and 9.15 respectively. Let's call that 10 points for the sake of convenience.

Now I've heard about this genius trader called kingfish who can take 10 points out of days with 5 point ranges. Because I'm not that clever or talented a trader my goal is a more modest 5 points out of a 10 point range. 5 ER2 points on 10 contracts is $5,000 on the first day.

2nd day I have $10,000 margin so 20 contracts...

Why limit ourselves to doubling our capital every week when we can do it every day?
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Old Jul 31st, 2005, 05:38 AM   #176
nononsense
 
 
Join Date: Jun 2003
Posts: 4,928
Quote:
Quote from guy2:

I know that you're joking nononsense but you got me thinking extreme stuff:
[...]
Why limit ourselves to doubling our capital every week when we can do it every day?
Hi guy2,

That I was not joking must have been obvious from my adding:

Of course, you can't do this without thinking. I'm glad I got you thinking extreme stuff.

As to your doubling every day, methink that's truly extreme stuff. Myself, I couldn't imagine ever getting there.

Be good,
nononsense
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Old Jul 31st, 2005, 05:48 AM   #177
PitchBlack
 
 
Join Date: Feb 2005
Posts: 1,619
Quote:
Quote from guy2:

I know that you're joking nononsense but you got me thinking extreme stuff:

Some brokers allow you to day trade a margin of $500 per contract so that means you could trade 10 ER2 contracts with $5,000 start capital. Now if you take a look at the Daily Notes page you will see that the 10, 20 and 40 day average ranges for the ER2 are 10.36, 10.51, and 9.15 respectively. Let's call that 10 points for the sake of convenience.

Now I've heard about this genius trader called kingfish who can take 10 points out of days with 5 point ranges. Because I'm not that clever or talented a trader my goal is a more modest 5 points out of a 10 point range. 5 ER2 points on 10 contracts is $5,000 on the first day.

2nd day I have $10,000 margin so 20 contracts...

Why limit ourselves to doubling our capital every week when we can do it every day?
500$ margin is only possible for small size trading, your margin will fast double or more when your size increases. ( margin will be maybe 1000$ when over 100 contracts and increase exponentially).


doubling up your size that fast will bring you to the next problem: volume. At the rate you double you will have in no time a size that is bigger than the daily volume of the market. In 21 trading days your size will be over 500 000 contracts.

But 1 thing reassures me: you will never be able to double on a daily base.
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Old Jul 31st, 2005, 05:57 AM   #178
Learner
 
 
Join Date: May 2004
Location: UK
Posts: 328
Buy a gun ($100?), go to a bank and make lots lots of the money! $100 000

Just a j ke
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Old Jul 31st, 2005, 12:59 PM   #179
guy2
 
 
Join Date: Sep 2003
Posts: 654
Quote:
Quote from ********:

500$ margin is only possible for small size trading, your margin will fast double or more when your size increases. ( margin will be maybe 1000$ when over 100 contracts and increase exponentially).
Very true spike - you'd have to split it across a few accounts.

Quote:
doubling up your size that fast will bring you to the next problem: volume. At the rate you double you will have in no time a size that is bigger than the daily volume of the market. In 21 trading days your size will be over 500 000 contracts.

But 1 thing reassures me: you will never be able to double on a daily base.
true again - however I like the idea that 5 back to back 5 point days (i.e. half the daily range) - would take an account from $5k to...

End
of
Day
1 -> 10
2 -> 20
3 -> 40
4 -> 80
5 -> 160

Anybody ever have 5 back to back 5 point or better days?
    Quote
Old Jul 31st, 2005, 02:29 PM   #180
lurefo
 
 
Join Date: May 2004
Posts: 1,722
Quote:
Quote from guy2:

...
true again - however I like the idea that 5 back to back 5 point days (i.e. half the daily range) - would take an account from $5k to...

End
of
Day
1 -> 10
2 -> 20
3 -> 40
4 -> 80
5 -> 160
...
Hi Guy2, nice maths... but if you don't fully automate the strategy, you have to factor in the mind adaptation time to the increasing size.

See, lets say you got really, really lucky and passed through the 4 days as your plan suggests...

Picture this : Friday morning, ER2 opens, you send your 100 contracts long order to the market. Oops you just ate 3 levels of market depth. You're not used to that.
The markets gets a bit wild and moves against you. You start sweating. Each tick is $1,000 worth.
You don't know why, but you have just canceled your stop loss order. Market drops 2 points.
At this point you feel totally paralyzed. While the market is falling, you realise you got caught in a trend day of ER2.

Just a thought...
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