Playskool My First Trading System

Discussion in 'Journals' started by rdg, Sep 1, 2007.

  1. rdg

    rdg

    For about 3 and a half years now I've been trying to trade futures with no real idea of what I'm doing. Something changed over the last few months, and I want to capture the next part of my adventure for posterity.

    I've never traded with a well defined edge, so my results have been fairly random. My trading is gross profitable but not net profitable. I want all of this to change. I coded up a simple system based on a specific price movement I first started noticing a few years ago. The system is so simple that I know I'm on the right track. There none of the "this indicator bounces off that level, this average is above that but below the other and the close is above here, then you buy." It aims to capture a real, repeatable, and understandable movement that takes place with some regularity in the US stock index products.

    There are a few nasty characteristics of the system in its current form that would keep me from funding it with my food stamps and relying on it to keep me fed, but it's a good starting point. Based on back testing results, I will be starting out undercapitalized, so I'll need some luck to get this thing bootstrapped on the first try. I can back it with other accounts if need be, so I'm just going to go for it and see what happens.

    The system is a day trading trend follower that trades no more than once per day and in practice no more than a couple of times a week. It takes so many marginal trades that I need really wide stops to keep it profitable. When I'm just starting out and trading it aggressively, it won't be surprising to see it lose 10 or 15% of the account on a single trade. So be it.

    That's it for the intro. I plan to go live with it Monday, September 10th. I will be trading a single YM contract and will post results at the end of the day.
     
  2. no. 22

    no. 22

    Good plan rdg.
    Most of the time you can do anything and make a profit, if you can afford to wait. Good luck.
     
  3. rdg

    rdg

    I originally didn't think I would be available to start until Monday, but I was, so I took the signal. I decided to show the starting account balance so everything is transparent. The small unrealized number is from a foreign currency position I can't seem to get completely rid of. Have a good weekend everyone!

    Product Traded: YM U7
    Contracts: 1
    Starting Balance: 4038.83
    Ending Balance: 4079.57
    PnL Today: 40.74
    PnL To Date: 40.74
     
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  4. rdg

    rdg

    Normally I won't post when the system doesn't trade, but I unsuccessfully tried again today to get the currency positions straightened out. They assure me everything is flat now, but I'm getting kind of unnerved at this point. The account window shows a 7.81 loss, I figure it should have been 5.33, but the difference from yesterday is 5.79. Shrug. I'll be watching my statements like a hawk now and if things don't balance soon I'll push them harder to figure out what's going on. Isn't trading fun?

    Starting Balance: 4038.83
    Ending Balance: 4073.78
    PnL Today: -5.79
    PnL To Date: 34.95
     
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  5. rdg

    rdg

    Starting Balance: 4038.83
    Ending Balance: 4239.52
    PnL Today: 165.74
    PnL To Date: 200.69
     
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  6. Hope the system works out well.

    Little suggestion, if you provide more details about the system it makes the journal more interesting for others.

    Usually when you open up to traders criticism and opinions do you more good than bad.

    Anek
     
  7. rdg

    rdg

    Oh how cruel the markets can be. My system thrives on days like today, but instead I learned an important lesson about using limit orders on entry. In short, I didn't get a fill on a day where the simulated results show over a 1k gain per contract. As a trend follower, I know that it is almost always more important to get a fill than to get a price, but I neglected to take that into account when I decided to change to a mechanical system. Scratch that one off the list and onward and upward we go.

    And Anek, I appreciate your comments. I think, though, that I don't want to make this journal about the specific system and instead make it a simple display of what happens when you throw an account at a profitable methodology. Of course this means that it will be really boring to follow on a day to day basis. But if I can stick it out, and we can keep the noise to a minimum, I think it could make for an interesting read in a year or two. Thanks for the contributions you've made to this site and I wish you the best in your trading!
     
  8. rdg

    rdg

    First triggered trade in over a week, and it was good for a bit of pocket change. We still haven't seen any strong t-days (except for the fed moonshot) since inception, so although it's showing a small profit, it's really just noise.

    Product Traded: YM Z7
    Contracts: 1
    Starting Balance: 4038.83
    Ending Balance: 4260.26
    PnL Today: 20.74
    PnL To Date: 221.43
     
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  9. rdg,

    Congratulations on your new system and its great debut. I hope the system is successful.

    Sorry to bother you, but I would like to know one thing. Is your system 100% mechanical?

    Thanks.
     
  10. rdg

    rdg

    Thanks for the encouragement. And yes, it is 100% mechanical.
     
    #10     Sep 27, 2007