Why don't you find someone who is making a "good living" trading ES with a $50k account. Anyone can post nonsense on a message board...the key is to seek out someone who is doing what you aspire to do and then deconstruct how they do it.
It might simply be a "pipe dream" (a plan, desire, or idea that will likely not work) but after I prove my system (God willing) by becoming an unarguably wealthy trader—an already profitable system that even as recently as last week achieved a higher level of objectivity and systematic methodology—I would love to open a chain of trade rooms around the country where people can come in, rent a station, and trade off my master chart configurations projected up on monster screens in front of the room. However, I won't be able to do this if I make public the components/elements that give me my edge, which is why I will unfortunately be unable to reveal the moving averages I use. I kind of like the Eyal Shahar story and his 1997 Irvine, California trading floors, except I would never switch the focus of my company from active trading to education rooms. In fact, rather than rent stations, I might actually invite participants to trade my own money, so long as they follow my guidelines, splitting the profits with them and allowing them to continue as members of the program so long as they continue to be profitable. They could come and go as they pleased, making as much or as little money as they wished that day, trading whichever sessions are of greatest interest to them.
Saying you make a good living on a $50k account in a first world country implies you're getting at least 100% pre-tax returns annually. Not impossible but I would not like to be in that situation for years on end; a multitude of things can happen that suddenly hamper your ability to hit that fairly* high lower bound a particular year. Arguably, it's absurd to not scale such an account unless you're on absolutely tiny liquidity, e.g. microc[r]ap stock - but that doesn't change the incredibly risky proposition it is to trade a $50k account for a living. Account = part of net worth available for investing and trading above, otherwise we are comparing apples and oranges where someone with $1 million in long term stock puts $50k into a trading account. If that $50k is part of a much larger available reserve capital that completely changes the discussion. * Very
Agreed, I just added that because it happens that people later append OF COURSE YOU HAVE MORE CAPITAL IN RESERVE after having made multiple posts about how it's possible to make a living on $50k.
Thanks. The thing is, with $50k, using a modest 5x leverage you could trade 2 emini contracts. From what I understand it's very possible to make a living day trading 2 contracts. Or am I missing something here?
Trading a 50k account would be something a seasoned professional who has just blown out a real account would do. They will trade aggressively and try to get it over 150k ASAP. If you've never traded, you're not a pro, or you don't know how to make big bets on rate futures in the treasury market, then you are fighting an uphill battle. Index futures are very closely tied into the treasury market. There are ways to trade that amount well, but know that it will be much harder than if you were starting with more money. Something like $150,000 would be a lot better...
It seems to me that you can make money on any trading format by following all the details of the strategy you have chosen. I know people who are equally good at earning short-term and long-term positions, I know those who trade extremely carefully and those who risk half of their capital because they see some interesting position, and in each of these categories there are people with incredible profits. A lot depends on how you feel about the market, what your experience is and what capital you have. Basically, I don't like restrictions when people tell me what I can and cannot do. For me, trading is a constant search and I don't think it's right to protect myself from the prospect of making money if you understand that you are doing what others are not doing.
Hello speedo, What do you mean by "I have set targets based on MFE within formations in my time frames"? When I back test and forward test, I track MFE to determine how much potential profit I could have made per trade before getting stopped. I also track how much potential profit could have been made once I exited at my predefined profit target. Thanks