Trades closed on Fri 3/Nov/06: --------------------------------- ESTX50: -17 pts, 5 RTs. DAX: no trades. SMI: +116 pts, 4 RTs. GBL: no trades. --------------------------------- Sleeping overnight: ------------------- 1x ESTX50 long from 3996 (-5) [ USD.CHF out 40k @ 1.2474, +20 pips, +80 CHF Here is the rest I am currently holding: 1000xCTCC @ 0.085 (-0.055) 400x EZEN @ 1.85 (-0.15) 350x FORD @ 5.43 (-0.41) 400x KHD @ 5.35 (+0.15) 300x MSLV @ 3.09 (+0.97) 200x PLAY @ 11.03 (+2.33) 500x SAMC @ 1.00 (-0.12) 400x SFE @ 2.34 (+0.11) 100x SGMO @ 5.61 (-0.12) 200x SNUS @ 5.06 (+0.52) + 200 @ 5.61 (-0.03) 100x WNR @ 23.53 (+0.86) USD.CAD long 50k @ 1.1254 (+43 pips) USD.CAD long 50k @ 1.1296 (+1 pip) AUD.USD short 40k @ 0.7743 (+41 pips) AUD.USD short 35k @ 0.7732 (+30 pips) ] *** new equity high @ $24,328 (+87.14%) (I believe something is wrong with my IB account, since my previous statements and trades don't add up. Specifically, I am missing 364CHF. I opened a trouble ticket and waiting...)
Weekly summary, week ending on Fri 27/Oct/06: --------------------------------- ESTX50: +40 pts, 29 RTs. DAX: 0 pts, 1 RT. SMI: +121 pts, 16 RTs. GBL: -70 pts, 1 RT. --------------------------------- Account balance (22:19 CET): $24,328 Weekly return: +$1,468 +6.42% Total return: +$11,328 +87.14%
That should be 3/Nov/06... sorry. I did some rough calculations. It's around 10 weeks that this journal is going on, and I returned +87%, that's a +6.5% per week on average compounded. In comparison, Larry Williams was compounding with around +9.5% per week on average when he turned 10k to 1.1m in 52 weeks back in 1987. Now, with my rate of coumpounding, I need 69 weeks to turn 13k to 1 million, that is 59 weeks to go ;-) Dream on...
Also, since my return comes from trading a wide range of products (Eurex Futures, Forex, and Stocks), in different timeframes, and with several techniques, I don't think that I just got lucky. I took my lots of losses, small and big ones, as well. I see no reason why my rate of compounding will go down. It most probably will go up, because there must be some learning curve that I am riding, or not? Here is the breakdown of the returns per week: 1/9 +6.1% (1 week + 3 days, started on 23/8) 8/9 +2.2% 15/9 +11.1% 22/9 +3.3% 29/9 +8.6% 6/10 +19.1% 13/10 +14.9% 20/10 -5.5% (vacation week, remote trading) 27/10 +0.5% (slow come back after vacation) 3/11 +6.4% I would appreciate any thoughts on this matter.
Just a thought: did you calculate the maximum leverage you ever used? With a 3x leverage the challenge is the eventual big drawdowns: NB. To avoid the psychological damage of big drawdowns, Schindler Trading cut its leverage by half in April 2005.
I never went on margin for stocks so far. The most capital I've used is 62% of my cash. As for futures & forex combined, I try to keep my initial margin requirements at a max of 50% of my net liquidation, although intraday I have stretched this up to 80%. Initial margin, not maintenance. My last drawdown (during the last 2-3 weeks) hit an intraday low of less than 10%, and only 6% on a close basis. I don't think I am taking excessive risks, what do you think?
I would calculate the leverage as the ratio of the economic value of the positions to the available capital. Say 3 long ESTX50: 3 * 3991 * 10 = 119,730 euros On a 20k euros account this is a 6:1 leverage (assuming no offsetting position). On a directional trade, it is not considered conservative trading... Now, as Soros said, leverage is a two edged sword. It works both on the risk side and the return side. If, on the risk side, you have a money management plan to handle a loosing streak you'll be fine++