Topsteptrader

At least the Chef has the right attitude.


"The one defining characteristic of successful traders is their refusal to quit in the face of adversity"

 

No it's not flawed logic Joe. TST does want traders to exercise strict risk management. The combine has less strict rules than the FTP it's a progression into the stricter rules. If they had the strictest rules from outset even fewer would make it through.

Saying it is set up for the probability of failure is flawed logic. It is set up as a business to earn money for the owners whilst providing a genuine service that is the true position. What you are saying effectively is because TST have all these rules that must be adhered to and the majority of people fail to take a cheque then it is setup for the probability of failure. That is flawed logic.

I can guarantee you if you had a combine with NO rules only daily loss limit and profit target the vast majority of people would still not be able to pass it. What you are concluding is that because the vast majority of people cannot trade profitably and TST has rules (whatever they are) that TST is setting traders up for the probability of failure. This is incorrect. TST is setting up the opportunity for traders in an activity which is extremely difficult, 98%+ are going to fail at this with TST or without TST.

If you look at most high performance coaches in sports/business/trading you will find that taking 100% of the responsibility of results is something that the individual needs to do early on to move forward with achievement of goals. What I am saying is blaming the rules or saying the rules are setting people up to fail is going to be a losing attitude. The TST rules are there, they are not unfair, yes they change time to time but ultimately to make it in this business you need to take full responsibility for adhering to those rules.

 

So you want to know the correlation of the Day 11 equity balance to the combine traded. It's bound to be a high positive correlation isn't it if we are talking about the subset of people who make it to Day 11 live. Of course it is likely that those trading the larger combines will have higher Day 11 equity balances, do you think they would have less for some reason? Let's say they provided you with this dreamed up stat you are looking for and it came back that the result was people who take the larger combines go on to have higher Day 11 balances. Would that really allow you to make an informed decision on expected value? of course not. The expected value is more a function of the traders ability, experience, discipline, psychology & market understanding.

Look a trader isn't any more informed on the expected value of their return because you would know this correlation. The expected value is pretty much zero for the vast majority and they are going to lose money trading with TST in combine fees or without TST to the market. There are no restrictions on who can take a combine, no filter. Literally a homeless alcoholic could enter if they could pony up enough money to enter. So you have an activity that is extremely difficult akin to high level sports and no filter on who can attempt it. The expected value of most peoples return is zero. or $0.00001c. The allure of trading is such that people think that anyone can make money at it or because someone told them they are 'bright' or 'street smart' they think its a valid career for them. The reality is it's not going to happen for 98%+.

The true nature of trading is lost on most of the retail populous. It's a competition. Pull 10 people off the street at random you have to be the 1 in 10 of those that destroy the other 9 in all aspects just to have a shot. Then take that 1 person and put them against 99 other highly disciplined / educated pro traders. That person needs to be in the top 5 of those 100 to make serious money imo. I reckon the success rate with no filter taking anyone is 1 in 100 maximum.

 

Day 5 down on the farm. just hit a +1 tick winner on ES. This time next week I will be submitting the combine for approval. Of course the only thing that matters is the live account performance. The FTP target of $3000 seems very doable compared to the $9000 combine target albeit with a few extra rules thrown in. GL

 

I agree that clearer communication from TST would help.

I strongly disagree with your point, however: other people's results have no correlation whatsoever with your own. None. You should know what your trading plan's worth (per lot) before you start spending money on combines, anyway, or else it's just a game of luck.

You're basically saying that if you could just get the tools that (insert any famous trader's name here) has at his disposal, you'd be expecting the same returns. I'm sorry, but no.

 

Ok, time for some clarification. I've stated repeatedly that there are only TWO questions a trader has to ask themselves:

1. Can I pass the combine?
2. Can I develop enough equity in the live account to take decent checks?

Of course each individual's results will vary! The point of having transparency with the correlation of equity to combine passed will simply provide a reality check to traders who think they're going to "get rick quick" with a 1 lot account. It's simply to separate fantasy from reality. A trading buddy just mentioned today that he heard the owner say that traders make very lofty projections when they start. This is no different than the equity prop world, where pikers pony up $2k-$5k for a live account and believe they will soon have a positive cash flow making a decent income given the 20x leverage.

 

The larger combine traders will have higher Day 11 equity balances and thus have a higher probability of utilizing the scale up plan. I've never disputed that, in fact I've mentioned that repeatedly in prior posts.

The combine has rules and restrictions that a live (retail) account doesn't. If one trades successfully utilizing those rules and restrictions and transfers that discipline into a live TST account, then there should be a positive expectancy of outcome in the live account (knowing that since the rules change in the live account, that expectancy will decrease if they can't adhere to the new set of rules). Of course, this is also provided they build enough equity in their TST live account by Day 11.

This of course doesn't mean that a currently profitable live trader will never "blow up" their account, at TST or retail.

 

Read my post again. IF you are trading ES in the combine, where there are NO restrictions regarding market moving events, and now you are a live trader, where you MUST follow the 18 specific news events, there is a greater probability of making a mistake that violates the rules. I've never advocated no rules and in fact I'm in agreement with many of the TST's rules, just not this particular one.

And yes, if one trades with a different standard of rules in the combine vs. the live TST account, then it's a set up for failure. This is why it's better to follow the SAME rules of the LIVE account when one trades the combine.

Regarding "flawed logic" I was referring to the fact TST has different rules for each level (combine/FTP/live), especially if the key is to build "strict risk discipline" as you mentioned.

And yes, of course there would be less traders passing if the live rules were the same as the combine! However, posting the # of "funded traders" who passed a simulator is just a marketing tool. As many have already stated, it's only the LIVE account that matters.

It's good that TST has been narrowing the gap between the different rules of the combine and live account.

 

That is a silly argument (posting only winners) and a scampish pr move on TST's behalf. Sure we hear about Jim's great Monday when he made 2K, but we never hear about his Tuesday when he lost 3K.

Without a longer time frame (Jim made 10K in January, for example or even better he made 30K in 3 months) those posts are only good for drumming up business.

...but not the stamina. If he is evaluating swing trading of stocks chances are he is not with TST anymore. That would be 2 blow outs in 3 months...

 

I couldn't fail to notice the lack of any good argument against my idea in your post.

I wasn't even criticizing their business model in that post. I was giving them a useful idea how to save money by not letting traders blowing out by accident, how to make extra money by fining them.

The Chef's example was just a sample, and that incident lost TST 2K or more in a few seconds. Now why would they want that happening repeatedly when it is completely avoidable? If humans can not be trusted, well, let's not to trust them. That's why we have machines.

If Joe is right and there are 18 events weekly to monitor when not to trade, that is way too many and just another good reason to implement my idea. I don't think there are more than 2 scheduled important events weekly for each instrument, but that is another matter. If TST wants to avoid more events, that is just more reasons to automatize...