Does any serious funding opportunities exist today for real traders?

Calinor

Active member
Hello, flashman57,

Thank you for your interesting and considerate reply.

Learning to trade in a professional capacity like you’re saying would definitely be ideal, but I think it’s not an option for me as I’m by now probably too old (38) and don’t have the right background (engineering and not finance/data science). Not to mention that proprietary trading doesn’t really exist here in Norway. Mostly, it’s only brokering that’s done here in Norway and as far as I know there’s less than 10 hedge funds doing any actual short term trading. Of course, I could move if that were an option, but I imagine the competition is fierce and the opportunities few.

Get funded trader challenges:

I don’t see these as serious alternatives for getting funding. At best, they give you a shoestring to trade on and as soon as you break a rule you’re gone. Regardless of how good your performance was prior to that. Bottom line is they’re not really looking to fund traders. You will never get any funding beyond the profits you accumulate yourself. So, basically, as soon as you’re funded and in profit, you might as well withdraw your money and trade it yourself for a 100 % profit split.

What I’m currently doing:

I funded an account with $11K and started trading it part-time (while holding a full-time job) in September. By the end of September I was up 49 % with 17 winning days and 5 losing days trading mostly one e-mini S&P 500 contract. My account peaked at $17 200 and I’m currently in drawdown after losing my balance Monday and Tuesday this week.

I got sloppy, greedy and complacent after a very good September. Most of my losses can be attributed to trading when I shouldn’t be trading and not actual poor performance.

I’m determined to get back on track, though.

My goal is to do this full-time, but I have mostly given up on getting funding or doing this professionally. So, I probably just have to trade part-time until I’ve grown my account sufficiently to be able to live off my trading.

It’s back to the chicken and egg. If I can grow my account substantially and have a good track record – would I really want or need funding?

Don’t get me wrong. I’d jump at any opportunity if it was a good one, but it seems like maybe by the time I have something to show somebody, I might not really need it?

Of course, if someone would really stake me allowing me to trade big size at one point, it would change the game for me. If an option, I could also provide my own capital for a cushion or act of good faith.

It may sound delusional and I won’t judge anyone if they laugh, but I firmly believe I’m a very able trader having tracked this market for a long time and having my trading backed by a solid methodology. While I use a predictive/statistical model custom made to my requirements, it’s still a discretionary approach at the end of the day. So I wouldn’t be able to provide any automatic back-tests.

Thank you in advance for any further guidance.

Best,

Johnny
There are some red flags here. I mean it in a well intentioned way because I have been through it.

"As soon as you break a rule you are gone..." Well why would you break a rule?

"I got sloppy, greedy and complacent..." Been there too. But you should know what it means.

"Most of my losses can be attributed to trading when I shouldn’t..." denial, also been there.

On the topic of the line above. It seems like you think you are a good trader, but you are not. The line above that, sloppy greedy and complacent, are those qualities of a good trader? It would be better if you viewed yourself as potentially a good trader with some understanding of the markets.

A discretionary system is not bad in itself, but it can hide all sorts of things and give you opportunity to live in denial, break rules, focus on the wrong things.

Most of your losses should come from the fact that even a good system has losses. The markets are hard to predict. Plus the transaction costs eat into your rewards.
 
There are some red flags here. I mean it in a well intentioned way because I have been through it.

"As soon as you break a rule you are gone..." Well why would you break a rule?

"I got sloppy, greedy and complacent..." Been there too. But you should know what it means.

"Most of my losses can be attributed to trading when I shouldn’t..." denial, also been there.

Thank you for your comment. Having been through it - were you able to solve it? If so, I'd love to hear your take.

Are you a systematic trader?

On the topic of the line above. It seems like you think you are a good trader, but you are not. The line above that, sloppy greedy and complacent, are those qualities of a good trader? It would be better if you viewed yourself as potentially a good trader with some understanding of the markets.

Well, I know I'm very good at analyzing the markets and have a good grasp of the big picture at all times. But, I'm not yet a very good trader as a trader needs to execute flawlessly on a consistent basis where IMO the most important is the ability to cut losses quickly and don't strain your risk profile while at the same time finding a happy medium between letting your winners run and also actually taking profits when there's money on the table.

Most of your losses should come from the fact that even a good system has losses. The markets are hard to predict. Plus the transaction costs eat into your rewards.

That's what I meant by "...trading when I shouldn't and being sloppy".

"Normal" losses, i.e., the cost of doing business from executing your system should be accepted as being totally normal. A good trader/system should not have (large) losses which comes from trading outside the system or outside regular "business hours".

Thanks.
 

Calinor

Active member
Thank you for your comment. Having been through it - were you able to solve it? If so, I'd love to hear your take.

Are you a systematic trader?



Well, I know I'm very good at analyzing the markets and have a good grasp of the big picture at all times. But, I'm not yet a very good trader as a trader needs to execute flawlessly on a consistent basis where IMO the most important is the ability to cut losses quickly and don't strain your risk profile while at the same time finding a happy medium between letting your winners run and also actually taking profits when there's money on the table.



That's what I meant by "...trading when I shouldn't and being sloppy".

"Normal" losses, i.e., the cost of doing business from executing your system should be accepted as being totally normal. A good trader/system should not have (large) losses which comes from trading outside the system or outside regular "business hours".

Thanks.
You know you are good at analysing the markets, I don't doubt it, and you have had some good results. Maybe similar to how I was. I could tell in advance sometimes to the exact tick or pip where the market was going to turn. At times the market seemed so predictable, exactly doing what I thought it would do. I still wasn't a good trader though, I hope that point landed. Sure I made some gains, but I had plenty of losses too that often erased a lot of those gains or sometimes worse. And I made excuses that my system needed to be discretionary, couldn't be backtested, if only I could stick to my system etc.. So your post resonated with me and felt I should respond.

It's always discretionary in a sense, you are the system. I would say that whatever discretion you have, that's just another rule to your system you haven't crystallised yet, or perhaps you don't want to. It's easier not to. If you're breaking your rules/trading when you shouldn't, I guess it's either because you have no discipline (can be worked on), or you don't have confidence in your system (need to prove it works to yourself with results), or there is a gap in your system (you know what to do if x happens, but don't know what to do if y happens and so in the moment you do something not great). I had all three :) so there's no judgement from me. Yes I know that a small account is a factor, but if you look behind the curtain that is really just no discipline.

Please make sure that your discretion isn't an excuse to hide away flaws and gaps in your strategy. Don't delude yourself.
 
You know you are good at analysing the markets, I don't doubt it, and you have had some good results. Maybe similar to how I was. I could tell in advance sometimes to the exact tick or pip where the market was going to turn. At times the market seemed so predictable, exactly doing what I thought it would do. I still wasn't a good trader though, I hope that point landed. Sure I made some gains, but I had plenty of losses too that often erased a lot of those gains or sometimes worse. And I made excuses that my system needed to be discretionary, couldn't be backtested, if only I could stick to my system etc.. So your post resonated with me and felt I should respond.

Sounds familiar. :)

It's always discretionary in a sense, you are the system. I would say that whatever discretion you have, that's just another rule to your system you haven't crystallised yet, or perhaps you don't want to. It's easier not to. If you're breaking your rules/trading when you shouldn't, I guess it's either because you have no discipline (can be worked on), or you don't have confidence in your system (need to prove it works to yourself with results), or there is a gap in your system (you know what to do if x happens, but don't know what to do if y happens and so in the moment you do something not great). I had all three :) so there's no judgement from me. Yes I know that a small account is a factor, but if you look behind the curtain that is really just no discipline.

Please make sure that your discretion isn't an excuse to hide away flaws and gaps in your strategy. Don't delude yourself.

Spot on, sir!

I'd say my discipline have improved tremendously, though. In the past, I would do extremely stupid things like sizing up considerably. Unfortunately, it even worked at times, but then came the inevitable huge losses. So, this time around I've improved by not doing this. I know I don't have a massive edge, so my profitability/expectancy requires that I take my losses and keep them small while riding my winners to target. I know that I need to keep my size small enough that a single loss or several in a row don't matter.

I've taken great steps towards removing discretion, but at the end of the day my system is discretionary. No doubt about it.

My goal/wish is to have indicators for my entry/exit points and as such reduce my discretion even further. So far, I haven't found anything which works to my satisfaction, but I keep looking and searching.

Were you able to remove discretion from your own system? I'd love to hear more if you feel like sharing this part.
 

Calinor

Active member
Sounds like you're improving and fixing the leaks and working on your character. Well done! It's a hard process.

Cutting losses and riding winners, yes good advice. That's also hard though, because you will typically take a lot more losses than wins. Tough to take 7 losses in a row, much easier to just lock in one win for small profit :)

Getting deep into your strategy and formalising all the rules and then backtesting them is hard. Even simple things the eye can see like support and resistance, highs and lows and so on, become hard and time consuming to code and backtest your strategy. Maybe you don't want to do it, and I understand, it's a lot of work. I am still suggesting you do.

The fact the above are all hard is perhaps why they are worth doing, and why the majority don't want to do them and instead lose. Or oscillate around breakeven for long periods.

As I mentioned it's always part discretionary. I choose the asset class, the risk I'm willing to take, I choose unbacktestable things like: I don't want to trade if I am ill. However, the core elements of the strategy, you need to backtest them. And then forward test them. It's only by doing both that you start to see all the gaps you hadn't thought of, or get a reality check about how the system performs.
 
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darrensammy

Junior member
I have not yet opted for proprietary trading firms yet. I’d suggest you to thoroughly check the background of the firm, evaluation phases, daily drawdown limit, overall drawdown eligibility criteria, profit criteria, whether EA is allowed or not and weekend trading options.
 
 
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