What Is Your Annualised Percentage Return?

TheBramble

Legendary member
8,394 1,170
twalker said:
The new guys who come here get taught a methodology and are slowly allowed to increase their risk as they get comfortable and start to develop their own style. It takes time and a lot of hours infront of a screen. Other than that it is really very mechanical. No big secret to it, just very different from trend following systems.

Take your point TW about a system being very much an individual thing.

The two great points that come out of your post are that in a prop environment, you only get more funds when they're comfortable that you're comfortable. Individual newbie traders do not have that external limit on theri excesses.

The other thing is the mechanical nature of your trading that you allude to. Get's rid of all the emotional decision making which tends to screw any system, no matter how simple or effective.
 

TWI

Senior member
2,536 254
Well when putting up the cash for new guys to come and trade then it is pretty important to institute good risk management. Start out allowing 1 lot clips then moving to 5, 10, 20, 30, 50 and 100. Takes about a year to get to 100lot clips. Fortunately the software allows risk to be controlled from a single interface so the newbies are physically unable to execute more lots than we allow.
As for the mechanical nature of the system, I think this is essential. The more moronic you make it the more successful it will be. How the individual expands on this moronic base usually determines whether you get a guy who ticks over or one who becomes a superstar. It is very much about trading what you see rather than what you might anticipate.
 

jonnyy40

Experienced member
1,329 11
If you've been stock/share trading for a year,what percentage did you make on capitol invested/risked.I don't mind if you give it as a percentage of your leveraged or actual cash position as long as you state which!(and how much leverage).I'd like to hear ideally from those that have been share trading for 3 months plus.
 

chump

Senior member
2,212 274
Pandora just won't go back in that box
 

Glenn

Experienced member
1,040 118
TWalker
twalker said:
......As for the mechanical nature of the system, I think this is essential. The more moronic you make it the more successful it will be. How the individual expands on this moronic base usually determines whether you get a guy who ticks over or one who becomes a superstar. It is very much about trading what you see rather than what you might anticipate.

Profound.
Have I understood correctly ? :-

Moronic = Simplistic (rather than stupid)
The superstar is the one who has the most moronic system.
The guy who ticks over has expanded a moronic system into something less moronic.

As regards trading what you see, presumably you mean if you get your signal then you act, regardless of what you think might actually be about to happen ?

Worth double-checking imho.
Glenn
 

TWI

Senior member
2,536 254
Glenn
I do indeed mean simplistic. The basic rules are simple and I think anybody can grasp them, after that it is about sticking to them. The people who tend to get best results will quite likely be less risk averse in the first place but more importantly will figure out more ways to get in and out of positions using rules but being able to covering more contracts/products simultaneously. Particularly I would stress the importance about knowing your outs, learning many ways to get out for cost rather than a bigger loss by utilising spreads.
When I say trading what you see I mean reacting to what is going on right now, not trying to work out what will be happening in minutes/days or hours and so taking a directional position for that. This is about getting in on a probability that when it goes right will make you money and when it goes wrong will lose you costs.
 

TheBramble

Legendary member
8,394 1,170
Glenn said:
Moronic = Simplistic (rather than stupid)
The superstar is the one who has the most moronic system.
The guy who ticks over has expanded a moronic system into something less moronic.


Glenn, piggy-backing on TW's post, I have on (too) many occasions 'tweaked' a perfectly reasonable SIMPLE system in order to make it more profitable. After dropping it when it begins to under-perform, I've gone back months later (years in some cases) to note that the originally, un-tweaked system worked a whole lot better over the long-term.

Some of us have a tendency to short-term back fit our winning systems until they suitably under-perform.

As regards trading what you see, presumably you mean if you get your signal then you act, regardless of what you think might actually be about to happen ?

A big Amen to that. I would go further and say if you find yourself trading anything other than what you see right here & now - give yourself a good hard slap round the face.

You don't know - nobody knows - what's going to happen next. You must do your probabilities based on what happened up to this point in time only.
 

Glenn

Experienced member
1,040 118
Twalker
"....being able to covering more contracts/products simultaneously."

OK if you have the ability to watch a number of candidates simultaneously. Perhaps for younger minds than mine :)
I prefer to do more size on few candidates, preferably just one.
Maybe this is putting too many eggs in one basket though.

Because of your own experience/familiarity, as you may imagine, you use a number of tempting phrases which are not necessarily specific or clear to newbies, but which are vital to understand.

"knowing your outs"
"learning many ways to get out for cost "
"reacting to what is going on right now"
etc.

No doubt you don't have the time/inclination to become a 24x7 mentor to the board, or get sucked into any lengthy diatribe. However there's no doubt that a few specific examples would be welcomed by many here, without giving away your jewels of course.
Glenn
 

JonnyT

Senior member
2,560 22
Personally I think 1% per day is exceptional.

JonnyT
 

anley

Senior member
2,730 229
Surely there must be someone here that a) doesn't make money and b) isn't on their way to becoming a billionaire? :)
 

TWI

Senior member
2,536 254
Anley, one thing I would say is that the method I use will not make me a billionaire soon as it is not compoundable ad infinitum. I keep a fairly constant margin in my account, varies from 20-40k. Certainly never more than that as I do not need to have more, I am doing as much volume as I am comfortable with. It is different to say 30% per month on a fixed sum than 30% compounded. Think the systems that can make 20%pa with the ability to handle huge volume will make people richer in the long run.
 

TWI

Senior member
2,536 254
Glen,
"knowing your outs"
This is just learning how to get out of positions in more and more ways.
e.g. If I bought a June contract at 100 and it was going against me, rather than closing out directly I may sell a Dec against it so creating a Jun/Dec spread and then working to get out of spread. Just a very simple example. If you have a spread you could sell another spread against it to create a fly or condor...etc. there are many different ways to put on and take off a position, often I end up with 6 legged and more structures.

"learning many ways to get out for cost "
Much the same as above. If postion even starts to go wrong, when it is a spread you can often scratch it for costs. This is also the case with an outright but you have to be quick on the system if you see it trading out.

"reacting to what is going on right now"
That is simply taking trades which produce a higher probability of success at this moment. Not really directional as you may be buying one month or spread and selling another because each looks likely to trade in that particular direction this instant. It is about dis-associating yourself with directional thinking for anything more than a tick or a few ticks.

Hope that may make a little sense. It is hard to describe. Far easier to demonstrate.
 
 
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