Topsteptrader

Shiko, Pekelo is an ass. Ignore him. He does NOT trade for a living and he admitted this on previous threads. Nothing wrong with that btw, just stating so you have some perspective on his views. Pekelo had a "paper journal" on ET where he averaged into a losing ES position and held it for months while it went 150 handles against him and went it came back and he was in the black he called it a good trade. Anyway, just some background on the guy.

Regarding TST, Shiko you get it. Anyone who has EVER traded gets it. Look, I ran a prop firm for years in Chicago. I recruited in total about 40 traders. We had options guys, futures and equities although our firm was options based. It was my job to manage their risk, help them with their trading, and keep things moving slowly. Now, while admittedly I did bring in a few "green" guys who were new to the business, a majority of the guys all had plenty of trading experience. Most of it at the retail level, like most of ET, but never the less, they all had experience, most of them were profitable, but not all.

So I agree with your point about this so called "newbie" status pekelo uses is a joke. I had a guy who made markets on the floor for 30 years who owned a 4 million dollar home in Highland Park come in to trade. Was he a newbie? Well, he gave futures a try and blew 200k. I guess Pekelo would call him a "newbie". The thing with futures is, a lot people come over from stocks and options and even FX for whatever reason. A lot of the equity prop guys I use to trade with in NY moved to futures. It seems like a logical progression. Although the markets are very different. So with TST you are going to get a lot of guys who had some success with options or stocks or whatever, but were running into capital utilization issues so they move to futures. It's a very rough transition. TST is absolutely the BEST thing for those guys. And none of them are newbies.

I went into a rant a few pages back about the real issue and that kind of died out but the real problem TST has and really anyone is that in my personal opinion, and this is only my opinion, full time intra-day futures trading is a losing proposition. It really is the market with the least amount of edge to extract. Especially if you are trading things like ES or the EUR/USD in my opinion. Now, before anyone blows a gasket, let me say I do believe there are "opportunities" from time to time and I certainly try to partake in them myself. And during those "opportunities" there is the potential for an experienced discipline trader to take money out of the market. The problem is, that does not exist every day or most days really. I think one has to be opportunistic. I mean do you think it would be easier to catch this last 100 handles up in the ES over the last few weeks or daytrading it every day with 4 tick stops? Everyone's answer is different I'm sure, but I have mine.

I think TST is probably late to the party. Had they started this venture 10 years ago they would have been insanely successful. And perhaps if the VIX spikes again and we have another crisis they will find some success. But the real question is and should be, is that your mo? Are you going to be a guy who can only put food on the table if there is a crisis market because we have the data on this going back 150 years and it's not frequent. If one is going to be in the market each and every day, this business is insanely difficult, "newbie" or not. I traded with bar none of some of the best traders in the country when I was in NY. These guys were lights out. Almost all of them left the business. Some tried their hand at futures, I guess "pekelo" would call them newbies, but few if any made it.

There is a reason why most of the futures prop shops have either shut down or moved into HFT trading with much less staff, and it's not because they are "newbies". You see Shiko, this is the conversation I tried to have on here because I think it's the central question that has to be answered. But the Pekelo's of the world have so much hate and animosity from their life failures that they make this into a debate about whether TST is a scam or how many billions the owners are making. All of which are non sequitor.

Of course on the amusement side, I enjoyed TST coming to ET. Because we had a lot of billionaire futures traders on ET that rambled daily about how easy it is and ran for the hills at the challenge of doing a combine just for fun. And the ones that did, well, the results are all in the journal section. Suddenly the net work of this web site dropped dramatically. LOL. So that has nothing really to do with TST obviously, it was something I already knew having run a prop shop, and that is the talk that is on this web site is just that, all talk.

I even told the funny story of how I actually brought in a lot of guys from ET to trade at my shop. Many of them had journals on ET showing never a down day or never losing yet with a real prop trading account and unlimited capital at their disposal, they blew out in months. Some even returned here to continue the charade. For the life of me I have no idea why they do this.

Now, don't get me wrong, I'm not trying to be a Debbie downer here. I just thing there are more important questions to be answered. Yes the rules are important and they have been discussed ad nauesum on here. I even joked that if traders had used their time working on their edge instead of trying to get around the rules, they would be far more successful.

So in the end, here are my thoughts. If you truly have an edge, the rules don't matter. If you don't have an edge, getting rid of all the rules will not make you profitable. I will tell you real quick what guys ultimately do when they admit to themselves they don't have an edge. They sell options, fade large moves or average down. All techniques that give the "appearance" of having an edge because of their high win rates. Of course these are not edges. And if one tries to do that at TST, it won't work and there in lies the rub. If you remove the averaging down part and the fading large moves part, trading starts to become awfully difficult. Now, don't get me wrong, I'm not saying you can't fade moves. I'm saying they are doing it in a thoughtless manner.

At the end of the day Shiko, a mirror reveals all a man needs to know about himself. That is the reason most cowards never look into one. Well, TST is that mirror. Shiko, you're a smart guy and while you may not have this all figured out yet, your understanding of the game is notable. Hard work will pay off. Just work smart.

 

Mav, I think you are spot on here. I traded equities for a living for 8 years and moved into futures in the last couple of years. I banged my head against the wall trying to sit at the screen and trade them everyday. I came to the conclusion that with volatility so low it's just not a winning proposition to do it full time.

What I've done is cut back to only trading futures a few times per week when the volatility and opportunity is there. If ranges start to expand again then I'll trade them more frequently. I'm starting to trade options on equities more now for some diversification. I've concluded that the only way to make it is to diversify product and strategy.

I know TST is struggling now and you can trace it right back to the decline in CL volatility. Most of the funded guys were just on that product and over the past few months it's incredibly hard to make money everyday with such small ranges. I'm sure TST just has their fingers crossed that some volatility returns so their funded traders have opportunities and so their daily broadcast has some participation again.

 

Pure intraday trading for futures markets is a relatively new opportunity. Only since contracts went electronic has there been real potential there... so we're talking roughly a decade for all popular markets combined.

Meanwhile, swing trading futures markets has existed for centuries. An example of numerous successful futures traders can be seen right now in the worldcupadvisor website for real-time, real money audited results. Not to be confused with silly paper calls in various message boards threads. Real proof that real traders make real money in futures markets.

But when it comes to strictly intraday trading, that window has narrowed greatly for volatility and liquidity reasons stated. Nobody on earth with ZERO exceptions is making consistently solid gains from recent ES sessions chopping thru 6pt to 8pt total intraday ranges. The pretenders might say one thing, but you'll never see them back it up with actual proof.

Until the past few years, financial markets since inception were made by makers interested in capturing the bid/ask spreads and also participating in order flow. For only the past few years, all financial markets have been made by HFTs and the federal governments whom manipulate price for different agendas. Obviously that changed markets' behavior, nobody who actually trades can dispute that fact.

The implosion of crude oil futures impacted TST greatly. The only futures market right now with consistent, dependable volatility and range is Russell 2000 and that's not offered thru them. So pure intraday trading opportunity is scant at best until VIX averages 20s or higher again.

On the other hand, holding futures trades for more than one session still offers ample opportunity in all commodity markets. But for many if not most of today's traders, the concept of "intraday" and "trading" are mutual. Those who accept the notion of trading positions held for days or longer instead of strictly intraday have the chance to prosper.

 

What's up with the obsession with ES and CL only. I don't even trade those and still bank some OK profits. There are plenty of other futures contracts to consider: ZW, ZC, ZN, NKD, GC, NG, JPY, EUR, etc.

 

you are asking a rhetorical question: the traders' obsession with ES and CL intraday isn't mine... it is the mass majority of traders out there. imo that's mostly due to public popularity and day-trade margins promotions from brokers directly

as for the interest rates, grains, metals and currencies you list, all of them have their strengths and pitfalls like anything else. periods of flat chop, periods of range expansions and trends.

 

Yes, all instruments have their strengths and weakness and all go through periods of trends, flat, chop, and range expansion.

THEREFORE... what's the LOGICAL conclusion guys?

Think about that....

 

There are all kinds of logical conclusions. Space does not permit listing them entirely. A few...

intraday trading is more lucrative at certain times versus other times.

certain instruments offer more / less potential for intraday trading than others.

no one can ever be profitable every day while intraday trading futures... a 60% -70% daily win ratio over long periods of time is excellent. Anything else unless backed with visual proof is fantasyland. 40% - 50% profitable days are more than enough to prevail if your profit-loss trades ratios are correct.

one could list dozens of other logical conclusions from there

 

Thanks Maverick74, I agree with many points.
I believe I should concentrate on one instrument and trade only one instrument and become specialist in this instrument. There also must be a balance between chart and DOM / tape utilization for successful intra day trading.
However, I do need daily loss limit as per TST. i am an emotional person.
I noticed when I am on fire my trading even when not 100% along my plan is better than I later back test, but when I am down I trade badly. One good point is that despite trading badly on some occasions I still do not blew things because I have this daily loss limit. It is for my protection.
Cut losses, manage winners and take profits and be consistent.
I test and back test almost every day.
The good thing probably is that I started trading when all these HFT and other changes took place so I see it as natural environment.
Swing trading would be nice but I cannot test it with TST. I used to practice in trend following staying in trades sometimes for 1-2 months. so, it is not new for me. But frankly I find that intra day trading is going better for me so far.
Btw, I wonder how guys are doing on Fridays... Fridays look like the worst possible trading day.
I have had some 5-6 losing Fridays in a row. were I to stay flat on Fridays I would have been next to Combine target. i am not yet but still have time. Not going to take any risk high risk to achieve the goal.
I noticed TST closed few trading pits o their squake radio including commodities.
I have not been watching ES or CL for months so I have no idea how things are going.

Trading ES with 4 ticks stop is a dumb idea. i think guys are doing this to increase size. There are moments when it is possible but it is not every day.
There actually was a short opportunity line in sand on Thursday with ZS when I added second contract to my trade and reduced stop. This was the only time I used more than 1 contract during this and previous Combine. This was a moment where I would pile up contracts to make maximum of this trade. There were 3-4 such opportunities during this Combine. i think you are talking about similar opportunities.
In any case I believe I will succeed eventually. The most important is self control and discipline to avoid large losses on bad days and consistency both with entries and trade management. It will take care of bottom line.
I wonder, are traders allowed to trade own money while trading backer's capital with TST.
I think it has total sense.

 

Yes, you can trade own money.
Regarding what are the limits and all, once you become senior trader - they are subjective, they do not have objective requirements for that.
Once you make 15k USD in profits you can negotiate-

daily stop
position size
no weekly stop.
transaction cost too.

We dont know cause i guess not many have gotten there
no one generally stops you, once you are profitable though.

Have you taken any combines?

Rules matter a lot, even when you have an edge. Trading is hard as is, without worrying about rules.
For me the only rules are no averaging and fixed daily stop.

but if you see the other rules

daily % win of 55% is rather easy long term if you have an edge, but that means 6 out of 10 days now, with no 20 day combine- its ok, but with a daily win rate of say 66%, which is ok, you will be on the borderline. 5 out of 10 days, should have been good enough, if you are profitable and hit targets, how does it matter anyway.

No averaging - this is ok. averaging is a bad idea anyways, best get it out of your trading asap.

Daily stop - critical if you want to trade intra day, else you will blow out.

Trailing max drawdown - This gets most people i guess.
Would have been easy actually if they risked on the downside though.
Once you make 2k, just knowing that you can lose 4k vs 2k, can make a lot of difference.

I am sure I can clear it in the next 3 combines max, if i take them - only problem for me was daily stop, and I have now become disciplined enough to implement it.

Once you make initial 5k/10k buffer there are no hurdles, still you have to realise, you have to clear these hurdles - three times, once in combine , once in pre- live, once in live - so that is a lot of worse and average case combines, and then will come the mammoth transaction cost of 5 USD/roundtrip. It's HUGE. The best traders i know, may still take months before getting to make that buffer, and i have seen a large sample set of traders.

 

Hi Nemesis45, I guess you are doing Combines too, right?
I have been through some 13-15 Combines by now.
Rules are already ingrained plus I have few of my own. Like 2 max losses a day. in any sequence. I do not average down. I trade only 2 1/2 hours a day in most cases. Trading stops at 12:06.
Been positive in my Combines consistently since the end of 2013.
I do not trade news releases days and I now I added one more rule no Fridays trading after reviewing data for 12 months.


I had a thought about cushion. What $2000 cushion means? Is it $2000 that is gross profit including trader and backer splits or it is net trader's money 60%. If it is only trader's 60% it would make cushion building far more difficult. I also wonder how backer withdraw profits. Only when trader withdraw and on same amount or as things go monthly.
It would make a huge difference.
Were I to trade live now and being in process of building cushion I would not take any money until I build a cushion good for some 2-3 contracts as per my calculations.
In this case trading own funds would really speed things up.

$5 fee definitely can be a hindrance if trader is very active. But it is here on simulator so it can be overcome.

Trailing max DD is a nasty thing. it got me on my previous Combine. But I hit it only during one Combine.