Interesting point here and I must say one of the golden rules of trading. I am an emini futures daytrader and I have a question out of curiosity: When you say small losses, how small do you mean? Given the nature of the markets, which tend to go up and down and provide very rare one-directional moves, if your stops are too small you are seriously in danger to be shaken out very often. For instance, I prefer to take a 20-tick hit in one trade, giving it plenty of room to work out...rather than take 3 small losses of 5 ticks each before finally getting it right. Hence, how would someone be kicked out of the program for having too large a loss?
<i>"I have already told you, when they get paid to do so. If you want to learn that, go and pay your dues and work at a firm and learn. Otherwise, are you really going to trust your hard earned money on what is hypothized and posted on an anonymous board? lmao."</i> With all due respect to everyone, what the hell difference does it make how institutional traders operate? No retail trader can mimic - match that, so who really cares? It's really not that hard to master averaging at least, bare minimum, +2pts ES per day <b>over the course of time</b>. That <b>over the course of time</b> statement means some weeks are barely +10pt squeakers while other weeks are good for +50pts to +100pts (yes, in one week) when volatility and ranges are wild. $100 per contract, per day trading for handles, not ticks. Master that, add contract size, repeat process. I know traders on a personal basis who accomplish that and more... trading only parts of the day, not glued in front of the screens from bell to bell. Time & effort, lots of both, what it takes. As for the few insider traders with privileged info? Their very existence is irrelevant to us.
Austinp, while killing time. i came across this very profound statement of yours. It made me pause, because this in a nut- shell correctly explains, i believe, why there are so many traders; yet so few arriving at the point of consistent and lasting profits. You are brilliant today, and probably did not even realize it. Should you want to be a scientist, engineer, lawyer, or physician there are all kinds of barriers that serve to reject those with no hope of succeeding, but if you want to be a trader -- well have at it, don't let me stop you.
You have a point, at the same time you also do not have a clue. It's far from squeaky clean on Wall Street, particularly among the real BIG BOYs. And some of it does require talent & smarts to execute, no matter how unfair the advantage is. You're really cheating yourself if you do not open up your mind and accept that it is partially a rigged game. Otherwise, it would not exist. There is no money to be made trading truly efficient markets.
Problem is over the course of time can be a really long time. As I recall I was quoted "it could take years", so it is not that simple I deduct since it would not take years to "get it". Be that as it may. As for the interest, I just doubt that the big boys sit in front of big screens with 20 indicators and 50 different MAs trying to deciphier what the next move should be. You yourself stated that there are guys placing up to 2000 contracts per order at certain time when their set up (I presume) presents itself. Now do they get that set up based on a million indicators? Or is there another way? if there is I would like to hear about it.
There are two kinds of people I've seen make money in the markets. The first are those who sit and stare at level 2 quotes all day like they're hypnotized until they can, through almost entirely subconscious means, scalp a market pretty well. No MAs or any of that bullshit, just staring and feel. The other kind, which vastly outnumber the first kind, especially when it comes to any kind of long-term success, are those that provide liquidity in markets based on liquidity in related markets using either technological superiority or some kind of financial modeling combined with good execution strategy. You really won't find any good information on this or most any board that will help you trade. People in the first category can't tell you how they do it, and people in the second category won't unless you go and work for them and sign the appropriate non-competes. That's just the way it is.
Oh, and chances are that you simply don't have the innate ability to be a part of that first group of people.