to good to be true?

[davidh1819]

Hello everyone

I have been spread betting for 2 month now starting with £4,000 my account is now worth £4,500 that is a 12.5% increase in 2 month my goal is to make 75% - 100% returns each year .

I have built a fairly straightforward trading system that is profitable if it is traded consistently. I am Trading Forex and Indices only and my system gives me around 6 or so trading opportunities each month with the 8 markets I have chosen. My strategy is to keep trades open for at leased a week to several weeks. I cannot intraday trade because I work full time ect.

My long term plan is to never draw the profits out and compound the profits over 6-8 or so years then I can be looking at a 5 figure yearly income to live off.

Now here is what I don't get

in the last 2 month I get up everyday before work and check my account for 5 minutes look at my charts and indicators ect ect .. Then during my luck break at work I check my account for a few minutes. The during the evening I check my account for 5 minutes or so.

So if I follow this routine and trade my strategy consistently which I am doing. which takes just 15 minutes a day over many years this can make me over £100,000 per year in the distant future?

Fortunately for me my mind seems to fit well with trading I am cutting losses and riding winners and if I do lose some money I don't mind because I believe my strategy and good judgement will be profitable in the long run

You see I have always believed that making large sums of money is very hard and takes a lot of complex tasks and hard decisions. I tried to set up my own website business a few years back with big plans and it failed miserably and it was no walk in the park it was very hard working long hours setting up servers writing hundreds of lines of complex code.

Now 15 minutes a day of watching a screen within the next decade can make me an abundance of money? Earning Enough each year to never work again?

Is there something I am missing?

 

[amit1986]

Not sure if "working" 15 minutes a day will make all your financial dreams come true - something just doesn't sound right about that.

In your case, it seems you have a programmed strategy that you let your computer take care off. In that case, you might not have to spend time on executing trades, but rather, on making sure your system works in any given trading environment. That will be the main work you'll have to do and should definitely take more than 15 minutes a day.

So, make sure you stay ahead of the market at all times. Find the conditions for which your strategy currently makes you money and if any of those conditions suddenly change (bear/bull market, economic policies, etc...), make sure you are ready to adapt.

 

[Shakone]

I have been spread betting for 2 month now starting with £4,000 my account is now worth £4,500 that is a 12.5% increase in 2 month my goal is to make 75% - 100% returns each year .
...
Now 15 minutes a day of watching a screen within the next decade can make me an abundance of money? Earning Enough each year to never work again?
...
Is there something I am missing?

Probably Yes. I'd guess you are missing experience.

You've been going 2 months, and you mentioned possibly 6 trades a month. That's only 12 trades. If I gave you a coin, and it came up heads 10 times, and tails twice, would you think you could just bet on heads and make 100k per year on it? If not why not? And if not, then why are your results so far any different from the coin example?

There are other problems too. What about when you have a series of losers and are down for 2 months? Will you cope? What about when it is is a 100k account not a 4k account, will you trade the same?

 

[TRADEFUTURES]

Not too good to be true.

I work no more than 2 to 6 QUALITY hours a week, ONLY on weekends, researching a multitude of markets in my portfolio & advance order new positions / adjust existing position stop losses. This has delivered triple digit annual gains over the last decade.

Stick with it. Less is more. And this also goes for your position sizing too, it can always be smaller.

The moment you start becoming engrossed or obsessed you'll find yourself in a high frequency compounding losing streak.

By reducing screen time, you'll naturally find yourself in winning positions that are allowed to run, and losing positions that are allowed to stop out while you are deliberately absent from your screen.

By sticking to this, over months and years, you'll out gun most 'consistently profitable' short term traders with far less effort & virtually zero stress.

 

[Black Swan]

Is there something I am missing?

No, perhaps there is something many of *us* are missing.

 

[anley]

The shorter your timeframe the more you have to work so it is possible what you're doing.

Nice to see someone for a change looking at the markets from a longer term perspective rather than having a heart attack everytime the FTSE (for example) falls/rises 30 points in an hour

 

[Hoggums]

Hello everyone

I have been spread betting for 2 month now starting with £4,000 my account is now worth £4,500 that is a 12.5% increase in 2 month my goal is to make 75% - 100% returns each year .

I have built a fairly straightforward trading system that is profitable if it is traded consistently. I am Trading Forex and Indices only and my system gives me around 6 or so trading opportunities each month with the 8 markets I have chosen. My strategy is to keep trades open for at leased a week to several weeks. I cannot intraday trade because I work full time ect.

My long term plan is to never draw the profits out and compound the profits over 6-8 or so years then I can be looking at a 5 figure yearly income to live off.

Now here is what I don't get

in the last 2 month I get up everyday before work and check my account for 5 minutes look at my charts and indicators ect ect .. Then during my luck break at work I check my account for a few minutes. The during the evening I check my account for 5 minutes or so.

So if I follow this routine and trade my strategy consistently which I am doing. which takes just 15 minutes a day over many years this can make me over £100,000 per year in the distant future?

Fortunately for me my mind seems to fit well with trading I am cutting losses and riding winners and if I do lose some money I don't mind because I believe my strategy and good judgement will be profitable in the long run

You see I have always believed that making large sums of money is very hard and takes a lot of complex tasks and hard decisions. I tried to set up my own website business a few years back with big plans and it failed miserably and it was no walk in the park it was very hard working long hours setting up servers writing hundreds of lines of complex code.

Now 15 minutes a day of watching a screen within the next decade can make me an abundance of money? Earning Enough each year to never work again?

Is there something I am missing?

It is possible to make a five figure sum with an average 5 mins a day on a relatively simple strat so don't fret over it.

However 2 months success is not enough "live" time to have confidence this is a long term successful strat.

 

[Scotty2Cues]

Probably Yes. I'd guess you are missing experience.
That's only 12 trades. If I gave you a coin, and it came up heads 10 times, and tails twice, would you think you could just bet on heads and make 100k per year on it? If not why not? And if not, then why are your results so far any different from the coin example?

think the probability of getting 2 heads in 12 tosses is 1.6%...

 

[shadowninja]

You've been going 2 months, and you mentioned possibly 6 trades a month. That's only 12 trades.

When people tell me that trading is easy and they've got a winning strategy that works because they've glanced at historical data and then taking 5 live trades, I tell them to take another 100 trades and then tell me how they've done. Life isn't so good for them. Then they adopt a Chase The Market strategy or a How Quick Can I Get The MOAL (Mother Of All Losses) Strategy by refusing to take another loss... but usually after the 20th trade after a 5 losses in a row or making four sets of 4 little profits and 1 big loss.

 

[meanreversion]

You know, it is possible that once in a Blue Moon, someone comes along for whom trading is second nature? It is possible, rite?

 

[Shakone]

think the probability of getting 2 heads in 12 tosses is 1.6%...

No it isn't. You've missed my point.

 

[the hare]

is too

Its definately close enough, I make it 0.0161

 

[Shakone]

That's because you're assuming the coin is 50-50 the hare, and making a calculation based on your assumption.

If you toss A coin, and it comes up 10 heads 2 tails, you can't say what the probability of that happening is, and you can't say it is 50-50. The probability is unknown, and you only have 12 samples.

 

[Scotty2Cues]

No it isn't. You've missed my point.

is

 

[Scotty2Cues]

That's because you're assuming the coin is 50-50 the hare, and making a calculation based on your assumption.

If you toss A coin, and it comes up 10 heads 2 tails, you can't say what the probability of that happening is, and you can't say it is 50-50. The probability is unknown, and you only have 12 samples.

yeah that's slightly different as youre saying we cant assume coin is random.

But using standard deviations etc we can get confidence intervals after a number of trades/tosses

 

[Scotty2Cues]

That's because you're assuming the coin is 50-50 the hare, and making a calculation based on your assumption.

If you toss A coin, and it comes up 10 heads 2 tails, you can't say what the probability of that happening is, and you can't say it is 50-50. The probability is unknown, and you only have 12 samples.

we can give probabilities if we assume its a fair coin and have no reason to assume otherwise. So you saying we cant assign probability 1/52 to drawing Ace hearts randomly from deck of cards?

 

[Shakone]

We can assume it is random if you like. Random doesn't mean 50-50 though.

I'm just labouring the point, that short term success is nice, but not really enough to make any good expectations on. There are still too many unknowns from 12 trades. I've taken more than 12 trades in a day, I don't think anyone would consider one day's trading enough to get a mortgage.

 

[Shakone]

we can give probabilities if we assume its a fair coin and have no reason to assume otherwise. So you saying we cant assign probability 1/52 to drawing Ace hearts randomly from deck of cards?

Getting a bit off topic now (my fault). Yeah you can give probabilities if you assume it has known probabilities (that's what you said right?). In trading we don't. We can assign a probability of 1/52 to the ace of hearts being drawn if: there are 52 cards, there is one ace of hearts, and the card drawn is made so that each and every card has an equal probability. If we didn't know any of those things, or say only knew there were 52 cards, and we drew cards and got an ace once out of 52 draws, shoudl we assume the probability is 1/52? Of course not.

 

[Scotty2Cues]

We can assume it is random if you like. Random doesn't mean 50-50 though.

I'm just labouring the point, that short term success is nice, but not really enough to make any good expectations on. There are still too many unknowns from 12 trades. I've taken more than 12 trades in a day, I don't think anyone would consider one day's trading enough to get a mortgage.

Been thinking about this lately. From those 12 trades cant he calculate the 95% confidence intervals or something?

Like landing on a new planet with population of 100,000. We find the average height of the first 12 we meet is 7ft, how much confidence can we have that this height is a good representation of the whole population?

 

[Shakone]

Sure he can calculate a confidence interval. But firstly, the less samples he has, the less precise the interval, and secondly, it says nothing about what happens in that 5%. Consider the banks and their VAR, or consider how a strategy with no stop loss and small target would look from just 12 trades if you created a confidence interval.