95% Rule? - An Experiment

Discussion in 'Trading' started by ig0r, Feb 21, 2004.

  1. ig0r


    Was thinking about this over the last few days and thought this expirement might work well on ET. Basically, I'm looking to investigate a number of things, one of them is that 90-95% (or more) of people fail in futures trading, the rest make good money. The basic idea of the experiment is that I will make up an imaginary futures contract, I'll start it at 1000, 50$ a point, each trade gets deducted $20 to simulate spread/coms. Each day I'll give a new closing price, high, and low (and the times of the high/low). To keep it simple, we assume that from open (the close of previous day), price moved first to the high (or low, whichever came first) then to the other, and then to the close. Stop/limit/stoplimit/MOO/MOC will be the acceptable orders for trading. This experiment will get best results as the number of participants increases, I'm hoping for at least 50. I'll be keeping track of number of long/short positions and from where. I'll emulate how the market would move in those situations as best as I can. If you're interested, post here your starting position. Assume you start with 5000 capital and margin/contract is 3000, 2000 maintenance. If someone is willing to help me, please PM or post, I hope to get some decent results and reach a conclusion on the 95% idea. I know this is not perfect since everyone will know each other's positions, but it should be a decent simulation of a futures market.
  2. Hi ig0r,

    Why do you need to know this to make money? Simply concentrate on being with the other 5%. Don't waste your time, Pal.

  3. i agree. not to be harsh but we are here to make money not play games.
  4. SumJurk


    First of all, you don't understand why 90% lose money. It's not because their methods suck, it's because they don't have the discipline to follow the method.

    It's a lot like dieting, you can walk in to any book store and find books on how to lose weight, and they all work.

    So, why can't people lose weight and keep it off? Because they don't have the discipline to follow the plan, day in and day out!

    You want to make money in this business? Pick a method you like...divergence, pullbacks, breakouts or whatever, and stick to it!
  5. I assume you mean pick a strategy that works. You're not saying pick any strategy and have the discipline to stick to it. It would appear to me that a large number of the failures are because of the lack of a proven method.

    IgOr, good luck with your experiment.
  6. SumJurk


    Of course, I mean one that works. The ones that do are no secret.

    For example, pivots. Floor traders have been making money off them for years. Others are divergences, fibb retracements, breakouts of supp/resist levels, etc.

    There are plenty of methods that work, and you probably know them all. This isn't rocket science.
  7. For a new timer to these boards, sumjerk aint no jerk... I agree with much of what he has said...
  8. SumJurk



    I'm a fader, I fade intraday high and lows. That's all I do, everyday, 5 days a week, 20 days a month, 240 days a year.

    Somedays I'll lose,
    But, I don't give up and look for another method just because I have a bad day!
  9. ig0r


    I'm profitable, I'm not looking for a way to make money :) And I know why we THINK 90% lose (because they don't follow a method or don't have a method) but I have very strong reason to believe this is only a small part of the reason (I for one trade with almost no method and no rules, while trading I concentrate on reversing my emotions (hope your winners go further, fear your losses going further), has been working very well so far). Rather, the nature of the market is to blame, at least that's what I wanted to determine, but I would need help. This is just a simple experiment, has nothing to do with my trading or with making money, I'm sorry if you took it that way.
  10. ig0r


    really? since when are we here to make money? do you make money by posting on ET? I certainly don't. I am profitable, and have been for close to a year now, the reason why I hang around ET is to continue my education as a trader and maybe help others in the process. If you would not like to participate, then you don't have to post :)
    #10     Feb 21, 2004