Good Traders are rare and hard to come by

Discussion in 'Prop Firms' started by esminifuture, Jan 23, 2002.

  1. I found this sentence in a thread and it's a good topic for my question.

    Well it seems that quite a lot of pro traders here are looking for "good" traders to hire them for there firms.

    So my question is what is a good trader.
    Wat is a good risk reward ratio on a year to day basis trading stocks on NYSE and NASDAQ.

    If heard storrys about 15:1 on a year to date basis..... CONSISTENTLY. I personally don't believe storrys like this one but let me know what is meening with " a good trader"

    I personally trade 3:1 on my portfolio.

    Don, Robert, Hitman and all other pros out there I would appreciate your comments.

  2. vikana

    vikana Moderator

    I think it's easy to deceived by 3:1 , 15:1 or whatever people claim they use/achieve. The issue is that no-one knows in advance what the reward is, we only have (some) control over the risks we take.

    I would much rather have people focus on total_wins/total_losses as an indication of how good the R multiple really is after the trades are put on and closed out.

    Just today, for instance, I had a stop on LLY that should have been around $180 get filled at $230 loss. It doesn't matter what I thought the risk was ahead of time ... the reality was a loss that was 30% larger than expected. Such is trading (I'm not complaining), There are obviously many other ways to describe the edge of a strategy, I just find the above one of the most telling.
  3. C2C


    A good trader might simply be someone able to use his/her trading skills successfully in the achievement of his own goals ;)

    More seriously, a good trader for a firm is someone who would not blow up too quickly and get them important revenues from commissions.

    >Wat is a good risk reward ratio on a year to day basis trading >stocks on NYSE and NASDAQ.
    If you mean the average risk/reward on the trades taken, this is a direct function of one's own trading style.
    Someone who uses to have 50% of winning trades must have an average >1/1 risk/reward ratio in order to be profitable.
    Another one with 20% of winning trades needs a >1/4 average ratio.
    From a money manager viewpoint, risk to reward ratio is the YTD perf divided by the peak-through-peak drawdown.
    So R/R ratio is not appropriate to measure how skilled a trader is.
    Neither is performance.

    IMO, all aspects must be considered, performance, money management, risk management, exposure...

  4. A good trader for a firm is someone who doesn't have more then 3 down days a month. trades from open to close, does at least 50 tickets a day and is able to gross and net. Bottom line is they feed the firm and themselves.
  5. Hitman


    I define a good trader as someone who makes six figures a year from his own ACTIVE trading, whether it be swing/intraday whatever.