Were you able to make money by following his trades? It's a bit suspicious that you just registered on this forum to post your appraising on that guy. But maybe it's just me...
Hi RB7, Yes, I was able to make money. There was a time in 2022 when he was trading consistently and was focused just on the markets and not everything else around him. I believe he has been a little more hit and miss this year so I haven't followed him religiously and I can also say I have entered trades that I didn't truly believe in and have lost as a result of that but equally I have been on to some good winners too as a result of following. I can say I have easily spent 50 hours listening to him live as he posts his trades and the main point about my post was that he is not a fraud in any way. Whether you consider him a good trader or you like his approach to trading is another thing but he is legit and I think it's unfair to the man to for people to call him a fraudster when it's fairly obvious he doesn't make any money from any of the 26k people following him as he doesn't charge them anything, he posts live for all to hear and if he was posting trades that didn't exist I am sure a lot of the 26k people would have called him out by now. Does he make money from the broker he uses? I simply don't know but if he did I would think he would be pushing that broker to his followers more often and he rarely does. I saw him live for the first time at a talk at CMC markets in London a couple of weeks ago so he obviously will work with other brokers too and I have no doubts he was paid for his talk as he flew in from somewhere (assume Denmark) to do the talk. I note your suspicions as I have never posted before but I don't think my first post is overly praising him, I was at times critical of certain aspects and simply posting my experience of having spent a long time listening. But in answer to your suspicion I discovered this site when I googled Tom because this morning he posted this to his Telegram: "STATEMENT 23nd May 2023 Over the weekend of the 20th and 21st of May 2023 a YouTube video was released, alleging very serious accusations against me. I am at this point, for legal reasons, unable to go into further details. The accusations are 100% untrue. They are baseless, without merit or evidence, and entirely unsubstantiated. Unfortunately, true to human nature, the court of public opinion doesn’t need much encouragement to jump on the band wagon, which the video incited. Subsequent to the release of the video I received a number of threatening communications, which I am forced to take seriously. I started sharing knowledge with the public in 2002. I have never until this weekend had threats made to my person and my family. It is a shock to me, and I don’t believe that I am in the right frame of mind to trade. It is for this reason that I am stepping back from public life until I have considered my legal response and given the authorities an opportunity to investigate. I will leave my Telegram channels open, as well as my website. Feel free to use and share the knowledge I have shared with you. Yours sincerely Tom Hougaard" I tried to find the video he was referring to but couldn't and after googling name and other words I found this chat hence my intrigue. Hope that eleviates your suspicions.
Hi TrAndy2022, I agree with you that slippage can be a problem and I acknowledge that in my post. I had a quick look at the numbers for this year and can see the following: 564 Trades (Across DAX, FTSE, DOW, NASDAQ) 1773 Points made Average of just over 3 points per trade Number of Days traded 61 Average points per day 29 I would say slippage works both ways and you can gain on them as much as lose but you make a valid point and if you lose a point or 2 from each trade he posts you might not make much money or it might not be worth the effort.
Would be interesting to know the average winner versus average loss if you have those. From what I heard from someone else that's following him is that Tom is big on the concept of adding to a winning trade, but when this guy followed him he mostly saw him take scalp trades and small profits which isn't quite congruent with the idea of adding to a winner and letting winners run. Thank you. PS: My superficial impression from the outside is that Tom isn't necessarily a great technical trader, but have done well thanks to excellent risk management, i.e., ruthlessly cutting losses on small size and running winners on larger size. I may be wrong.
I have posted a screen shot of the numbers for 2023 only. I personally think his 2022 numbers would look better but I am not going to punch through 12 spreadsheets to find out ;-) As you can see his average loss on all indices (in 2023) is greater than his average win (typically by a point or 2), however he wins more than he loses (60% win rate on average) which makes him profitable (Up £300k). His loss amount is pretty much always fixed as I stated previously, he typically moves the stop loss up towards breakeven when the trade is in his favour. I kind of agree with your comment about adding to winners, I have seen him do this a lot but not so much in recent months. When he enters a trade he starts to see how it develops, if it isn't doing what he expects or the reason he entered it he sometimes closes it out to take a small scalp but there have been more recent times it has gone in his favour and he's not added. He tends to admit when he is not in the right frame of mind to trade and I think he hasn't been more recently. I also agree that it's his risk management that has put him where he is but isn't that what most seasoned traders will say. The old mantra "Cut your losses, let your profits run" or as per his book "Best loser wins" But ultimately, I think people need to form their own opinions. They could follow every one of his trades for a month on a demo account and see what slippage they got, how good he was and more importantly if they made any money and if they felt it wasn't for them they have not lost a single penny/cent. Wish everyone all the best on their trading journey.
Here are my findings FWIW. Intrigued by hearing a lot about him, I have been following Tom´s live trading for several months now. I do firmly believe that Tom, as a person, is a solid, honest, straightforward guy. He does not charge anything to any one for the knowledge he shares, he does not have anything to sell other than his book (which costs next to nothing). YET, there is something that does not feel entirely right in all his trading and associated activities, and I cannot quite put my finger on it. Here are some thoughts: * If you have strong edge like he seems to have, why would you put it up for grabs to more than 25,000 followers, for free, not counting all the people that just take his (simple) strategies off his website?? Hell, there are even several scammers selling signals on the back of his trading (which he is aware of) , so there is for sure a large degree of proliferation going on which can cause a threat to his system´s long term profitability. The risk is, if his results are real, that some institutional traders follow the strategy for huge size as well. If an edge gets proliferated / known to so many competing market participants, surely it will cease to be an edge quite quickly . This is what I cannot get my head around. Why would you put your bread and butter at risk in such a way like he is doing??? Consider the fact - which I am sure you all know - that Renaissance Technologies and Jim Simons are mega secretive about their edge which gives them just shy of 51% winning percentage. Tom seems to have around 61% winning trades. * This concern I have should be even more valid if we consider scalping / day trading to be a negative sum game, so why would you do that, i.e. giving complete insight, shouting your edge in detail from the rooftops?? If the algo´s / market makers sniff out what Tom (and by consequence thousands of followers and same system traders) are doing , (btw, most of his trade set-ups are very simple, precise and objective, based on H and L of specific "signal" bars, not vulnerable to subjective interpretations), they would start to trade against these weak hands and make money by picking off / squeezing all these short term traders and trades ... (by the way, I believe this MAY be what is slowly unfolding now, as Tom´s track record is slowly but steadily deteriorating, he recently had a rare loss month and his YTD bottom line is much less than what it used to be). * Next point: if many of these CFD brokers (such as Tom´s) would see their client is consistently profitable, they would simply start copying the trades via a simple program and get exactly the same execution price and P&L on their copied trades. Hell, they could be themselves quietly selling the signals under a different name. That is what happens in the FX markets. Needless to say, the same signal/trade risks getting proliferated even more and would destroy the edge even quicker. * I wonder if /why Tom has not yet asked these questions himself and what his response would be. He clearly is very smart so why never talk about these risks? Could it be he is counting on a huge execution wave of flow which he creates himself and rides in the first place? What would be the max capacity of trading size that could be executed before it starts to distort the strategy? * For a private/self trader his stake size is very high (200 GBP per point). You can only trade that size, if you have unwavering solid confidence in your edge and system (and/or sit on a large pile of cash so you can´t be too stressed about losing a boatload per day). The psychology fluff (meditation) around his trading may be valid to some degree but is quite vague and imho OTT and can not in itself account for the successful track record (if it is real). Some of the trading greats admitted they were scared with every single trade they took, yet that did not keep them from performing very well and could even be the reason why they performed well... So this psychology bit about eliminating fear remains a question mark as to how much it contributes to his success. * OTHER RED FLAGS: What I do find strange is that he does NOT show his live trading on screen, we never get to see the executions on his platform, account balance, trade blotter. How do we know if it is real money trading? How do we know he does execute at the entry and exit he says? He never seems to suffer from any slippage, yet many of his followers do. There is no third party track record at all. I have seen Tom being attacked and threatened quite aggressively by disappointed signal followers as is also shown higher in this thread. Like some others have mentioned already, he swears by his off-shore small broker. A bit strange. Not sure what to think of it. * BOTTOM LINE. So perhaps, as far as I can see, his only true edge is indeed adding to winning (short term) positions, not the system or entry/exit signals in itself which - given the large stake size- needs a decent amount of confidence. So imho it´s the "position sizing" component which is the driving factor, mixed with a "psychological" factor which is hard to quantify. Food for thought: looking at his numbers of losing and winning trades as published by others above, imagine what the outcome would be IF HE WOULD NOT add to winners, his success rate would be closer to 50% or even below 50%.
Could you tell me more about your passage about the broker, could sell any trader his trades or positions as signals under different names in FX trading, really ? I never heard that before. Also a broker can only do A-booking and not taking the same position 10 times or so. Or I am mistaken here ?
You bring up some valid points. Maybe forward this message to Tom for himself to read. A few additional observations and thoughts. 1. If Tom have a marginal strategy, it's possible he could get a benefit from sharing his lagging signals as additional orders in his direction could move the market in his favor. I can only speculate, but if thousands of followers were copying his trades I'm sure it could move even a liquid market a few ticks or even points short term. 2. If Tom had a fantastic strategy (he doesn't), it would make more sense to be secretive, but from what I understand he's trading basic price action concepts, i.e., common knowledge and trading 101. As such, there's not much to hide, honestly. 3. I may be wrong and this is only speculation, but Tom is still a retail trader and I do not think institutional players have any interest in what he's doing and would not waste time trying to make money off his plays (either with him or against him). He's still a small fish in a big pond. 4. Performance issues. Posting live trades in front of an audience is generally a bad idea. Especially if you start performing poorly. Suddenly, you're more concerned about how you're perceived and being right - than actually trading the market. Typically, you'd let losses run and cut winners short. I would bet that this factor in addition to the flaws of his strategy is why he's having issues. 5. Keep in mind that volatility have been extraordinary for the last few years, so as soon as volatility is dropping a strategy that have been minting coin can easily go breakeven or even negative. Adding to winners is a good example as this generally requires a strong trend. In a range bound market adding to winners generally doesn't work, unless your add ons are very closely strung together and your initial entry was early. Which still generally works poorly due to the mean reversion nature of a range bound market. I can see many reasons for why he's running that room. Trading is a lonely business and maybe it's his way of having some community. Or maybe he have ulterior motives. We can only speculate. Unless someone was sharing something extremely worthwhile or consistently posting killer trades I wouldn't have any interest in hanging around in a trading room.
Profitable strategies are a dime a dozen. Want an example? Take nothing but bull or bear flags, qualify by either an up sloping or down sloping 20 EMA. Put your stop under/over the signal bar, enter on a takeout of the bar back in the direction of the trade after an opposite color (a trap) and set a target of 2x initial risk. If you do that, you will exceed 50% winners and your winners will be larger than your losses. Most will not abide by those simple rules. They will talk themselves out of a signal or a trade will begin to go against them and they will move the stop or add to the losing trade. Or they will have 2 or 3 losses in a row and will pass on the next signal because they are afraid it will be another loss. Or lose focus (maybe engaging in too many bullshit threads on ET?) and miss signals. Or they will take it but exit too soon as "At least I made some of my losses back" just to watch it go to target. Moral of the story? Trading is not about the strategy although an edge over a statistical significant number of trades must be present, but about the trading (trader) itself. As far as Jim Simons goes, managing a portfolio of billions with many positions open is an entirely different thing than an independent trader day trading one or a few instruments....apples and oranges.
I think that specifically with this point, he trades one of those spread betting instruments that are available to people in the UK I think. This has tax advantages from what I remember, but I think this in no way has any impact on the underlying instrument. In fact, I see it when his fills seem to be far away from where the market was back when I was following him in real time. I think its because even though the NQ or YM might still be at some level for a few seconds, the spread betters have already moved the market in their instrument. Its no different than major difference between the micro and mini contracts. They can sometimes be more than just a few ticks apart. This also means he pays no commissions since the cost is in the spread. But since there is no impact to the NQ contract, if everyone follows Tom into the trade at the same broker, all it would do is give people worse fills in their spread betting account but not move the NQ itself.