Listen to JimmyJam, he REALLY knows you know

Thanks for the tips everybody, I'll try the techniques on the YM

 

Hope it helped:

Here's some information on MandelbrotSets

I

 

And here's a document on assymetric growth mangement of your account, care of KingCambo Trading.

I

 

Interesting read so far. Kind of like what AustinP wrote about but with less risk built in. I'm interested to see where you are now as we have both been around a bit. I got bogged down with other things and discouraged myself. I am trying to rebuild some self confidence and regenerate the vision I had of trading and making money. What phase would you say you have progressed to with your given account size (maybe smaller, maybe larger than written example, I am not really interested in knowing your profits or account size, just in your progress). Thanks for any reply.

JIM

 

Looking forward to checking it out when I get a few minutes.

 

I took the concepts in the document, worked and reworked them, and developed spreadsheet models which I'm very happy with.

The concept is always to start small and grow the account, this presupposes that one has a good method of entry, exit and stop placement.
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For that you have a number of different approaches, one of which is to take the market turns as they happen (non-trend). Another is to trade according to the price action which exists on a higher fractal (trend) Each approach has their pluses and minuses.

Good trading,

I

 

All of the money management modelling is done on a scalping system, which is perfect for an assymetric approach to growing your capital, because virtually every trading day of the year will yield you some profits (ref the thread on getting 10 Pips a day - $100 - to see what I mean by that statment).

Ten Pips a Day, Everyday

From the thread you will see that there are obviously people who believe that because they haven't figured out how to do that, no one else can.

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For position trading you would have to increase the risk side of the equation and the reward side of the equation in a way which is consistent with your unique style of trading. The important thing to remember is to size up in an assymetric fashion, the simplest way to explain this is to give an example:

1 contract = $4,000 in the account
2 contracts = $12,000 in the account
3 contracts = $24,000 in the account
4 contracts = $48,000 in the account
Etc.

(this is just an example using the YM e-mini contract, as I do not know your specific style of trading ... but nor do I need to discuss the concept, once you get it, it works on everything).

This forces you to earn your way (something I firmly believe in) ... and assuming you have everything else in place as a trader, by the time you are position or swing trading 10 contracts with an mean average of 100 YM points per trade for each trade lasting a period of approximately 2 to 4 days you are making a substantial amount of money with substantially less risk than was posed to your account when you were trading just 1 YM contract.

And when a trade or two goes against you, simply scale down your size as determined by your lower account size.

This is how traders scale up in size while decreasing their risk, it requires more time in the initial phases of trading, but perpares you for greater and more long lasting success once you really got yourself in gear.
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The ideal trading model is one of course, that encapsulates more than one method/style of trading/instrument (ie, scalp financial e-mini's while position trading notes and energies, etc.) This diversifies your risk and negates the effect of one sector moving against you. However you do not want or need to become too diversified, as this also spreads your rewards too thin as well.

Good trading,

I

 

Some different fractals that traders operate on, the whole purpose of the game is to know which one you belong on, and pwn it:

Level 1 - Warren Buffet style ownership of companies (years, decades)
Level 2 - Sophisticated stock trading (months, years)
Level 3 - Longterm Swing trading (weeks and months)
Level 4 – Intermediate Swing trading (days into a couple of weeks)
Level 5 - Position trading (2 to 5 days)
Level 6 - Day trading (15 to 30 min)
Level 7 – Scalping (15 min or less)

 

Hey..when you start trading a "run-of-the-mill" 7 figure futures fund let me know. Maybe you can learn to be profitable in 2008..best of luck!

 

Well... Thats okay. I really do appreciate knowing where you get your money management style. Still wondering. HOW HAS IT WORKED FOR YOU in the last year or so? Would be helpful to know how this theoretical stuff works in Jimmyjam's really world? Hope you can reply.

JIM