My journey: Stocks to eminis, scalping to strategy

Discussion in 'Strategy Development' started by candletrader, Aug 22, 2005.

  1. My Dearest of Brethren,

    I was in conversation yesterday with an experienced futures trader who has a very different trading style to myself... the gentleman in question is a successful high frequency futures scalper... as some of you know, I made my living for many years in the equity markets (first as a fractional scalper prior to decimalization, then as an intraday swing trader), and have only relatively recently (relative to how long I have been trading, that is) found significant and consistent success trading the stock index futures -- after, I hasten to add, a somewhat prolonged drawdown...

    These days, I am primarily a trader of the emini S&P, and I look to take as much as possible out of intraday moves. In my approach, for every 20 days of the month, I actually may place zero trades on around 10 days... and, yes, all trades are opened intraday and exited the same day... For example, in the last 20 trading days, I have only had 13 trades, of which 5 were winners, 5 were losers and 3 were scratches... it was a very pleasing last 20 days, in terms of net profits (moreover, the commissions to net profits ratio was virtually non-existent)...my current trading style is akin to being a glider who seeks the occasional thermal and then simply enjoys the ride...

    In my early days as a trader, I was a scalper on Nasdaq and NYSE, taking 1/8's and 1/16's all day long... even if stocks were still quoted fractionally, I doubt I would have the energy or inclination to go back to that young man's game... my memories of scalping are that much was based on 'feel' and I deployed very little (if any) conventional technical analysis... the thing about scalping was that I had to be in tip-top psychological condition in any given minute, or the odds were I would lose... scalping, as such, was not a strategy but simply a mindset... a mindset of extreme discipline coupled with hardly any 'real' analysis or strategy... this style of trading was akin to being 'on manual control' in the cockpit of an F16 in the midst of a dogfight with a MiG...

    I have made the transition from stocks to futures... more specifically, I have made the transition from high frequency intraday equity scalping to low frequency intraday index futures strategy trading... I enjoy the freedom of not having to press buttons all day long (equity scalping) or continuously scan for opportunites (intraday equity swing trading), and my older age just can't keep up with the high intensity trading/scanning approaches and associated stress levels that those in their early 20's seem to thrive on... I am less profitable than I used to be (and I am not prepared to increase size to become as profitable as I used to be, since the money management implication would be a significantly more uncomfortable, volatile equity curve), but I am infinitely more satisfied in the quality of my life as a trader...

    It would be interesting to hear from experienced traders about their journies over the last few years, in terms of changes in what they are trading and changes in how they are trading...

    As ever, and with genuine feelings of love for you, the Fraternity of Traders...
    Candle
     
  2. Feel free to add your accounts of transition...
     
  3. The market invariably gives you one or two trades a day that are no-brainers. My problem is still boredom so I try to scalp during the day to keep my interest up but it is a breakeven venture at best.
     
  4. trade duration, stop size?

    btw - how old are you, candle?

    thank you!
     
  5. Trade duration: minutes to all day
    Stop size: proprietary
    Age: too old to scalp i.e. no longer in my early 20s (or even late 20s)
     
  6. what's your highest number of trades per day?
     
  7. When I was an equities scalper, perhaps a hundred round trips... with an average of maybe fifty round trips...

    As a futures trader, probably ten... but that's an extreme case...
     
  8. bump...
     
  9. trendo

    trendo

    This might be a dumb question, but what does "bump" mean?

    Thank you
     
  10. Its something you do when you want to bump a thread back to the top of the list of active threads so more people will see it and respond.
     
    #10     Aug 23, 2005