Because for the size I'm currently doing as a small retail trader, the DAX is just fine - and A LOT MORE profitable because of volatility and entry opps. Profit is relative. That prop dude averaged 3.5T/day = E 35/day per contract, a bit more than 1pt/day on DAX. I wouldn't be remotely happy with that. In fact, I'd give up trading. However, clearly if I want to trade 50 contracts a pop, I will have to look for different media of expression. Right now, this isn't my main concern though. I love trading the DAX. You can trade bund if you like.
You are right, it's around 4 ticks per day but don't forget that generally, it cost 3 or 4 levels of depth to execute his size and he liked to enter all his size at once. Some days, him alone was doing 3% of the daily bund volume.
Well, look at Mark / velocity_trader who does over 20K contracts/month. Didn't someone say he averages about 0.5-1% of total DAX volume? Amazing! On the other hand, on a contract like DAX that trades ~100K/day, that's only 500-1,000 contracts traded. So if you're trading 10 cars/click, that's only 50-100RT a day. Any active scalper can do 100RT and more. I can. I just am not doing that kind of size yet. But might be soon, who knows. And how about the liquidity problem, anyway? I have found that my particular style tends to become wobbly beyond about 5-6 contracts on DAX. But how about the fact that more active traders also add liquidity? For example, you couldn't really say that Mark "steals" 1% of daily DAX volume, because he actually contributes that volume. If he wasn't trading, the volume wouldn't be there. So, I think we have to talk in terms of traders having a "share" in volume, rather than "taking" a certain amount of volume, as often seems to be implied. So your bund dude actually did 3% of the daily volume because he went in there and quite possible made the market ~3% larger. Not because he controlled or took out the volume in some way. Am I getting this all wrong here? Any thoughts?
Oh, apart from that - You have a point in liquidity being an issue with such size - But do you think that displaying and trading such size may also have advantages to it, like scaring and manipulating other players? Clearly, if you're a big fish in the pond, the view's a little different to being an unseen nobody.
He wasn't displaying the size, just lifting offers or hitting bids. The year he made 25m, he didn't try to scare the market, he was just in the zone, in perfect sync with market (I can tell that I know I will never see something similar in my life; there were days you thought he had received the intraday chart in his mailbox). The quarter he lost 8m, he was much less in sync and was very often trying to scare the market by executing his size at once near the high or low of the session or near crucial S/R levels.
That's interesting. How about false size display games though? Wouldn't that be easy for a player like him to constantly load the opposite side of the market he wants to trade and then pull the size once he's in, like many large players do, particularly on bund? It's the old "pull the carpet" game. I would love to be able to play games like that, but then wonder if it might not be pretty dangerous, too. A friend of mine, also a prop trader, told me he used to trade smaller issues at times, being the "big fish" in the market, but then it often backfired, too. Now, he says, he'd rather be a small fish in a big pond than a big fish in a small pond anyday. I think he's got a point. Any thoughts on that?
Ouch! How did you lose on that nonfarm? It was such a blowout number, 1K. Did you accidentally hit the wrong side?