From Micros to Millions: 2% per day

CALLumbus · Oct 26, 2020

DevBru said:
Even when you are paying $1500/month in commissions and you only need an IOM seat it is worth leasing one, leasing prices on those are only $200-$300 per month but it would give almost $600 in commissions savings per month. (Assuming the commission round turn is $3.7, like it is at AMP).
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I agree that leasing a seat already makes sense with medium volume.

But careful, leasing a seat wont save you any commissions, it only reduces the exchange fees you pay.

maUL3dNQ · Oct 26, 2020

Great thread! Keep up the great progress. Hope you catch some of this bull wave today.

CHeers

robbo · Oct 26, 2020

I agree great thread, sstheo looking forward to watching your journey.

syswizard · Oct 26, 2020

volpri said:
I would say about once or twice every couple of weeks.
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So, do we have a SPBT (small pullback trend day) today ?

SimpleMeLike · Oct 26, 2020

sstheo said:

FREEDOM!

From Micros to Millions: 2% per day

View attachment 241747

I am ready to be FREE of everything that is holding me back from EXCELLENT TRADING.

It's finally time to BECOME the disciplined and jubilant trader of my avatar:

To begin this new journal, I now post an extraordinary goal:

Starting with Micros, I will try to turn $6,000 into $1,000,000 in 12 months.

You read correctly. $1 million. And I think it is doable. At least the math says it is. And my confidence is high.

In an uninterrupted compounding curve, this is about 2% per day. But in order to pay living expenses and to be prudent in case of disaster, I will be withdrawing 50% of my gains each month. So my real daily goal is a bit closer to 3%.

But carefully note that the $1M or the 2% are really not that important. What is important is discipline and consistent growth. This is the thing that most traders miss. They are constantly looking for home runs - both on the day and on individual trades. I am looking for base hits on both. Base hits are still what win the ball games!

I had a couple other journals on ET where I demonstrated that 2% average per day is doable:

Aug 2019 https://www.elitetrader.com/et/threads/micro-e-mini-madness-2-per-day.335221/

Jan 2020 https://www.elitetrader.com/et/threads/2-000-to-200-000-in-2020-at-2-00-per-day.339591/

Indeed, I am on a quest to become a better trader. Posting here on ET is really helpful to me to have public accountability. And it helps me formalize my trading including

instruments

position sizing

entries

targets

stops

other trading rules

In addition to helping myself focus by writing in a trading journal, one of my other motivations is to help other struggling traders struggle just a bit less, and maybe turn an important corner. With this in mind, please consider the following three ideas.

1) Micros: The new sim. The new CME Micro E-mini futures (micros) are the new sim. Trading with real money, even if low-leverage is far better for your trading brain than sim. Get off of your paper-trading account. Live micros were my salvation to help me finally get things going with my small account.

2) Run from the "Funding" Temptation. Stay far away from the funding companies like TST, E2T, LeeLoo, OneUp, etc. "Free money" is a seductive siren's song. But when you carefully analyze their trailing draw downs, you see that these companies have absolutely no risk while you get sucked into a black hole of subscription fees and resets.
And the expected performance is simply unsustainable. In order to win their funded accounts in one cycle, you must consistently earn an average of over 9% per day on your account. For example, the Leeloo 15 contract account requires $9k in profits with a $5k max DD. In 20 trading days, you must average $450/day. $450 is 9% of your true available capital - the $5k trailing drawdown. NINE PERCENT PER DAY. Let that sink in.
I did a survey of traders in a chat room, and the average trader had spent about $7,000 in fees before they succeeded or just gave up.
And all were frustrated with all the little rules and restrictions on payouts.
And if/when you finally succeed, you will get to give them 20% of gains. (Many who made it quickly withdrew their winnings and opened other accounts.)
Yet traders flock to them in droves. I did it too.
There is a better way. Yep, try #3.

3) Fund your own account and trade micros live. We now come full circle. Take the $7,000 you would have spent on funding companies and start trading live with the micros. (You can start with as little as $100.) This is what this journal is all about:
How to start with a small account and grow it into something big, beautiful, profitable and sustainable for you and your family to live on as the world becomes increasingly chaotic.
I know a trader who has taken $500 and turned it into $25,000 starting with the micros. He switched to one E-mini, and now he is using two E-minis per trade.
I have personally taken $2k to over $6k using just the micros. (see the second link above)
I am now starting with $6k and will shoot for the moon.
And I get to set my own rules.
And I get to keep all 100% of it.

Visualization of the Goal

My objective in the next 12 months is to take a tiny acorn and help it grow into a mighty oak tree.

View attachment 241770

As mentioned in a previous journal, for me to turn this $6k acorn into a mighty Million $ Oak Tree, I need to keep doing two things that seem paradoxical. (1) I must protect this cash like the gold in Fort Knox, and (2) I must also grow the balance daily. I must honor all stops. I must be flat when the trade is not clear. I must trade well, always trying to improve my entries and exits. I must increase the contracts per trade.

The Psychology of it All

Some have told me that 2% per day puts too much pressure on myself. But the goal is 2% average. And it is very attainable. I have passed many combines at 9% per day.

And if I don't reach my goal, even $4k+ per month will be life-changing. That would be $50k per year.

The plan is to always trade the same, no matter how large the account gets but increase the contract size. So it's really all about the ticks earned, not the profit per trade.

The purpose of the daily % increase is so that I GRADUALLY increase in my ability to "trade at size." I should barely feel any different when I am at $20k vs $6k. Some have predicted doom when I get above a certain size, but I aim to prove otherwise. I have a friend who has started to trade with 50 ES contracts per trade. WOW! Yes, he is stressed. But he has built up his account and his courage and strictly honors his stops.

How this journal is different

In the other journals I received trade management suggestions from readers from time to time, especially during the initial stages of the pandemic. Thanks to everyone who tried to help me succeed. I am not being cocky here, but I am not looking for significant guidance. And I don't have much time to help others beyond what I post.

If you are suspicious of my trading or just have no clue where I am coming from, then please review my previous two ET journals. Not much has changed in my trading since then, so feel free to review them. I have a system, and my goal is to trade it and turn a profit each day. But I won't be a jerk. I will certainly answer questions and consider your comments. You may also consider sending me a private message.

One of my mentors thinks I shouldn't even be on ET at all because it is distracting. But I have weighed the pros and cons, and I think for me I am better-off overall taking the time to plan and reflect on results here on ET than just trading all alone each day.

From the old journals, along with the daily progress, one of the things that people wanted more of was to see actual trades, both charts and trade blotter results. I will do more. But know that I am a scalper, and what you ask for is tedious and time consuming, so let's see if I can link a reporting service. Either way, I will be sure to show losses as well as wins.

Off to a Great Start

Here is my AMP report for the first week after I topped up my account to $6,000. The first column is the new balance at the end of the day. The first day I made $133.

View attachment 241775

And here is my new spreadsheet and graph with new columns for

Number of trades

Avg contracts per trade (.1 = 1 micro)

S&P ticks

S&P points

S&P ticks per trade

Avg Net $ per trade.

View attachment 241778

I am currently averaging over 50 scalps per day with a net profit of about $3.00 per trade. I am currently trading only 1 micro per trade, but I will scale this up quickly and reduce the number of trades. Ideally, I will be in the 20 to 30 trade range.

With the current balance, you can see that 2% of the total is $133. So I am currently shooting for at least $133.00 net after fees on Monday.

As mentioned, it's all about the ticks. My average right now is 2.5 S&P NET ticks per trade. On the ES, that is about $35 per trade less $5 in fees. On the MES that is $3.75 per trade less fees. Because the micro has a significantly higher fee structure, I do want to switch over as soon as possible. I am averaging 130 ticks or about 33 S&P points per day. So I am off to a great start.

Obviously, if I increase the number of contracts per trade, I can reduce the number of ticks gained, and I can finish sooner in the day.

I am only allowing myself 1 micro max per $1000 in the account. Once I get above $10,000 I will have permission to trade the ES/NQ/YM/RTY. For now, I am just trading the micros, MES, MNQ, MYM, and M2K. I will evaluate my comfort level with the E-mini as I get closer to the $10k mark.

It's time to take off the training wheels!

View attachment 241780

Next up: Methods and Rules
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Good Morning sstheo,

I have a question for you please.

What are your stop trading for the day rules regarding max loss or % of capital loss?

Thanks,

sstheo · Oct 26, 2020

Snuskpelle said:
So my immediate thought is, what's your edge? (Not inquiring about specifics, just curious about which category.)

Other posters have already adequately covered the incredulity the comes with the claims outlined in OP and I would just be rehashing by pointing out that I'm incredibly skeptical. Regardless, if you can actually do this, you don't need to prove it to anyone else but yourself and make that million ASAP. Good luck!
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What is my edge...

userque said:
Do tell.
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Several times I mentioned a free chat room that I started to help funded traders stay funded. Instead of saying "don't do that" he just banished me for life. When I challenged him on it, he said, he said that I was taking advantage of his "no unpaid advertising" policy and "I know your type; you will fill your room with my subscribers and then change to a paid model. I have seen it many times." Pretty frustrating.

sstheo · Oct 26, 2020

Millionaire said:
When i said you will be paying a fortune i was not refering to the micros.

Even with 1 emini lot per trade you will pay a small fortune if are taking 500 trades per month.

500x$4 = $2,000 on a 10K account.

On a 50K account (assume you trade 5 lots) you will pay 500x5x$4 = $10,000 per month
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Good observation. It may be time to lease a seat soon and continue to increase my average ticks per trade as I am able- by letting appropriate trend trades run a bit longer.

sstheo · Oct 26, 2020

DevBru said:
Flat rate is cheaper at $0.74.
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Thanks. It appears that the flat rate kicks in at the $10k balance mark if I ask for it.

sstheo · Oct 26, 2020

DevBru said:
Even when you are paying $1500/month in commissions and you only need an IOM seat it is worth leasing one, leasing prices on those are only $200-$300 per month but it would give almost $600 in commissions savings per month. (Assuming the commission round turn is $3.7, like it is at AMP).
More...

Thanks for the calculations!

sstheo · Oct 26, 2020

SimpleMeLike said:
Good Morning sstheo,

I have a question for you please.

What are your stop trading for the day rules regarding max loss or % of capital loss?

Thanks,
More...

Great question. My max daily drawdown is 5% of the starting balance each day. This would give me 20+ days of life if I had a REALLY bad streak. I am looking at a way to automate it so it is not just a line in the sand, but one that is cut into stone.