Current returns for 2008/09 financial year?

[jono1887]

Hi,

I just started trading around October last year... (after i turned 18 so i could open a trading account)

Anyways, I was just wondering how people are going returns wise in this current economic situation. I read that any returns currently are good as most people have made a loss... I for one have managed to make a considerable return so far - beginners luck perhaps?

I've also read that the best traders such as Buffet and Soros are only able to get returns of about 80% a year. Has anyone in these forums achieved over 50% returns in a financial year??

[So_Cynical]

Hi,

I just started trading around October last year... (after i turned 18 so i could open a trading account)

I for one have managed to make a considerable return so far - beginners luck perhaps?


As i have said many many times...luck both good and bad is all timing.

October was the best time to buy almost anything in 08

Did u buy gold stocks in Oct ? or other miners ?

[jono1887]

As i have said many many times...luck both good and bad is all timing.

October was the best time to buy almost anything in 08

Did u buy gold stocks in Oct ? or other miners ?

Actually no, my first trade was MQG at 28.86 and sold at 32.48 a week later...
I only made 6% from this trade. Since then, ive made a total return of 54% from my 25k investment.
I was just wondering if these returns are normal or have i just been
incredibly lucky??

[Mr J]

I've also read that the best traders such as Buffet and Soros are only able to get returns of about 80% a year. Has anyone in these forums achieved over 50% returns in a financial year??

Their numbers are meaningless compared to our levels, and Buffet isn't really a trader. He certainly doesn't average anything anywhere near 80% a year (I've heard 20% as the figure thrown around). A small, independent trader has the potential to achieve far greater returns.


Anyways, I was just wondering how people are going returns wise in this current economic situation.

For many traders I assume it would have been an excellent time. Traders profit through movement in price, and what better opportunity than a crash?


I was just wondering if these returns are normal or have i just been
incredibly lucky??

You may have over-performed, you may have under-performed. Nobody could give you reasonable indication of what you should expect. There are many ways to trade, and greatly varying levels of performance among similar trading styles.

54%? If you're not disappointed with it, then you should be satisfied.


Has anyone in these forums achieved over 50% returns in a financial year??

While 50% isn't anything to sneeze at, it's certainly not uncommon. Variance alone assures that this will be achieved regularly, and it really doesn't take much to achieve more than that based on expectation alone. I'd be surprised if 1000%+ wasn't achievable in expectation alone, depending on account size. Don't take my word for it though, I've just seen many people vastly underestimate the earning potential of similar activities, and if anything trading is more profitable.

[Nero64]

Since then, ive made a total return of 54% from my 25k investment

Where did you get that sort of money to start with as an 18 year old.

Did you start an apprenticeship at 14 or something?

[jono1887]

Where did you get that sort of money to start with as an 18 year old.

Did you start an apprenticeship at 14 or something?

10k of it was mine from part-time work at kfc, pizza hut ect... the rest of it
was a interest free loan from parents.

[Aussiest]

Actually no, my first trade was MQG at 28.86 and sold at 32.48 a week later...
I only made 6% from this trade. Since then, ive made a total return of 54% from my 25k investment.
I was just wondering if these returns are normal or have i just been
incredibly lucky??

You did enter the market at a very low point. Did you do any analysis before you bought those shares? Were your decisions based on anything other than a whim?

[Nero64]

Hey Johnno,

I read your other post, what Uni you going to and what subjects you doing.

I went to Uni once. I like to think I got something useful out of it.

The loan was nice from your parents. Learning money management and investing early is a great start in life.

[So_Cynical]

Actually no, my first trade was MQG at 28.86 and sold at 32.48 a week later...
I only made 6% from this trade. Since then, ive made a total return of 54% from my 25k investment.
I was just wondering if these returns are normal or have i just been
incredibly lucky??

Some what lucky...certainly not incredibly lucky

Incredibly lucky would of been buying MRE, IAU, MDL, LGL at there Oct lows and selling now at over 100% profit.

[helicart]

if you can make >30%pa every year for 5 years, go start your own fund....or take your results to any managed fund and they'll give you a job.

and you need to do it with a reasonable reward / risk ratio..... if you don't know how to measure this, then google expectancy, sharpe ratio, sortino ratio.

understanding reward/risk is important to predict when your 30%pa profits are going to blow up.

[Mr J]

if you can make >30%pa every year for 5 years

It depends how his strategy scales. 30% on 25k is unlikely to be similar to 30% on much larger amounts.

[jono1887]

You did enter the market at a very low point. Did you do any analysis before you bought those shares? Were your decisions based on anything other than a whim?

Well, I dont do any technical analysis... i just read the news papers and stuff from bloomberg, ive been following it for a while before i started, and look at the graphs of price movements... when i think that prices are as low as they'll get or that there is alot higher potential in a stock, i make a purchase.


Hey Johnno,

I read your other post, what Uni you going to and what subjects you doing.

I went to Uni once. I like to think I got something useful out of it.

The loan was nice from your parents. Learning money management and investing early is a great start in life.

Im at UQ, taking double degree of Arts/Medicine, but im majoring in economics for my arts deg.


Some what lucky...certainly not incredibly lucky

Incredibly lucky would of been buying MRE, IAU, MDL, LGL at there Oct lows and selling now at over 100% profit.

Currently i only trade safe stocks... ive only traded with MQG, RIO, BHP, FMG and FXJ so far.... bought RIO after that massive one day crash some time in november last year, same with FMG in december and FXJ after its capital raising earlier this year... other than that, i just trade fluctuations in MQG and BHP which are safer bets IMO.

[Aussiest]

when i think that prices are as low as they'll get or that there is alot higher potential in a stock, i make a purchase.

But, you need to have a reason for believing there is a lot more "upside" potential in a stock. Eg, does it have a good balance sheet? Don't just look at a chart and believe that it has been at XXX, so it is likely to go there again.

Maybe read the MQG thread here to learn more about this group. Also, have a read of the BNB thread, as many liken it's business model to MQG. Personally, i would stay away from this stock, but that is just my take ;)

Congratulations on the medicine degree, you must be a pretty bright kid :D

[helicart]

It depends how his strategy scales. 30% on 25k is unlikely to be similar to 30% on much larger amounts.

true, let alone the regulations.....but a private fund with less than 20 members is another story...scale wouldn't be a problem up to 10m (R<2%) on the US and UK markets.....plus scale is more of a problem when the strategy is long term investment with high exposure most of the time, larger positions have to be adjusted...trading smartly rarely sees more than 20% of your capital on low leverage in the market at once...


Im at UQ, taking double degree of Arts/Medicine, but im majoring in economics for my arts deg.

.

did you get into med via the yr 12 provisional sub quota?

if so, then you have the brains to trade a lot smarter than you are now....though maybe not the right mindset......you have to think like a dull boring rigid dispassionate scientist....once you let intellectual cockiness get in the way, you'll blow up....

you want to do some serious reading on stats and money management....or you'll blow up within 2 years. am sure others here can recommend 6 books...

[Mr J]

if so, then you have the brains to trade a lot smarter than you are now....though maybe not the right mindset.

With respect to the poster, there are a lot of intelligent people out there who are very foolish when it comes to a gambling activity. I would say most people are incapable, perhaps due to lack of effort or not being able to adjust their thought-process. I think it's the latter, as traders have to suppress natural human behaviour which becomes a liability in trading. Humans lack discipline, are ruled by emotions, are results-oriented, look one step ahead rather than five, only see a general picture etc. It's hard to change one's behaviour, and how many people here will say that trading hasn't changed them in some way?

[helicart]

With respect to the poster, there are a lot of intelligent people out there who are very foolish when it comes to a gambling activity. I would say most people are incapable, perhaps due to lack of effort or not being able to adjust their thought-process.

which is why I recommended a trader think like a scientist.....
the story of James Simons' Renaissance Technologies should be taken on board by anyone serious about trading.....they don't generally hire people from finance backgrounds, preferring science, stats, and maths disciplines.

[jono1887]

did you get into med via the yr 12 provisional sub quota?

if so, then you have the brains to trade a lot smarter than you are now....though maybe not the right mindset......you have to think like a dull boring rigid dispassionate scientist....once you let intellectual cockiness get in the way, you'll blow up....

you want to do some serious reading on stats and money management....or you'll blow up within 2 years. am sure others here can recommend 6 books...



yep, i got into that provisional subquota thing....

could you elaborate on how i could be trading smarter?? any tips or advice would be greatly appreciated!! :D

What books would be good to start off with??

[jono1887]

Variance alone assures that this will be achieved regularly, and it really doesn't take much to achieve more than that based on expectation alone. I'd be surprised if 1000%+ wasn't achievable in expectation alone, depending on account size. Don't take my word for it though, I've just seen many people vastly underestimate the earning potential of similar activities, and if anything trading is more profitable.

what do you mean by on expectation alone?? :confused:
1000%!!!! :eek::eek: who has been able to achieve those figures??

[Mr J]

By that I mean without needing favourable variance (i.e. luck). Returns will vary greatly depending one timeframe, effort, skill etc. I'm sure 1000% has been done many times. Probably often not by skill, or skill alone, but done all the same.

[tech/a]

If your nett worth is $1mill and your trading 10% of that then having positions that could potentially return over 100% would have you labelled as a trading Maverick.

Extreme returns are often found from smaller accounts and relative to funds in the account.
Techtrader had return on investment over 1000% over the 5 yrs it was in the 2002-2007 Bull market.
$30,000 to $360,000 at one time its equity peak was $439,000.
All traded as an exercise on "The Chartist" Still is but is dormant currently.

Only mention it as its a record of having achieved "crazy" returns.

[MRC & Co]

Just look at TH, his done 1k to 50k in a wk! :eek:

Best % return I've ever done along a similar line, is 1k to 20k in a month.

So yes 1000% per annum, it is very achievable, but on smaller accounts.

[jono1887]

wow, i never realised those kind of returns were possible :eek:

[MRC & Co]

wow, i never realised those kind of returns were possible :eek:

Don't worry about 'what is regarded as a good return' as per your initial question and post in the thread. Work out how you can be the best you can be without any limits of the imagination, most will regard it as impossible, because in their perceptions, it is and for this reason, they will never achieve it.

And I wouldn't say you have to be a rigid, dispassionate scientist, but you have to have conviction in yourself and the ability to keep a positive mindset, because there will be times and many of them, when doubt creeps into even the most confident of minds.

Personally, I would say, the life of a trader is a constant evolutionary process. You never reach your destination.

Like always, only my opinions of course, which are based off my own perceptions, whilst trying to form no opinion! ;)

[jono1887]

none of the replies have actually answered the question asked in this thread... what are ppls current returns for this year??

[beamstas]

It's not about this years returns that count.

Would you like to return 100,000% this year, sit around thinking you are the best there ever is and then blow 100,000% next year

I know it's a bad analogy but concentrate on being consistent. It's hard to scope and compare yourself to others by asking them what their return is this year. In theory this year should have been one of the most profitable years for traders in the last 5 years

Brad

[Nero64]

Currently i only trade safe stocks... ive only traded with MQG, RIO, BHP, FMG and FXJ so far

I wouldn't call these safe stocks exactly. FMG and RIO have debt issues and MQG and FXJ are getting hit with the down turn. A safe stock to me is WOW or AGK. However it is likely that these stocks will not visit their lows again if more bad news doesn't come out of the US.


you want to do some serious reading on stats and money management....or you'll blow up within 2 years. am sure others here can recommend 6 books...

Alot of investors have made money blindly investing, but yes if people used stops then there portfolios woudn't be 40-50% down. Depends on risk profile. People can wait it out, that's if the stock can rise again. I doubt MQG will hit $100 again or whatever it got to.

[Mr J]

Don't worry about 'what is regarded as a good return' as per your initial question and post in the thread.

A good return is one you are satisfied with.


none of the replies have actually answered the question asked in this thread... what are ppls current returns for this year??

Last 7 trading days I've grown a paper trading account by 73%, does that count?

[tech/a]

Trading account since March + 64%
Increase in Nett worth from trading account Around .5%

See my point here.

[jono1887]

Trading account since March + 64%
Increase in Nett worth from trading account Around .5%

See my point here.

Nope, what is your point??

For you to make a 64% increase in trading but only 0.5% increase in nett worth, it must mean you only trade approx 0.95% of your net worth....

[Mr J]

His other assets may have offset his trading gains, as well as his trading account only being a portion of his trading capital.

[MRC & Co]

Trading account since March + 64%
Increase in Nett worth from trading account Around .5%

See my point here.

Not much trust in your trading (hence the tiny amount of overall capital weight directed towards it) or other investments (your company) generating higher returns (which would be something)...........

[jono1887]

Just look at TH, his done 1k to 50k in a wk! :eek:

Best % return I've ever done along a similar line, is 1k to 20k in a month.

So yes 1000% per annum, it is very achievable, but on smaller accounts.

just out of curiosity, what stocks were they??

[Largesse]

just out of curiosity, what stocks were they??


they trade futures not stocks (that i'm aware of)

[tech/a]

Not much trust in your trading (hence the tiny amount of overall capital weight directed towards it) or other investments (your company) generating higher returns (which would be something)...........

Some would not consider it tiny but a man of your means probably would.
Company and Property certainly return way more than any trading and equate to far more in terms of nett wealth.

Another you may consider is Need.
I dont need an income from Trading---nor do I want one. If I can pull $100K or so a year from Trading then I'm happy. I dont need/or want to generate an income from it or put as much capital into trading as Business or Property.
Market conditions may well vary my decision from time to time.


For you to make a 64% increase in trading but only 0.5% increase in nett worth, it must mean you only trade approx 0.95% of your net worth....

Close its around 3% currently but varies from time to time.


just out of curiosity, what stocks were they??

Scalping the Hang Seng if I remember rightly.

[jono1887]

Close its around 3% currently but varies from time to time.


Well my trading account consists of approx 75% of my net worth i think... so any gains i make are quite relatively considerable for me....

[kennas]

Um, is this thread about current returns for 08/09?

For me, I'm still well down and need to make about $100K in the next 2 months to earn nothing.

Wish me luck! :)

[tech/a]

Good luck Kennas.

Just think Tax deduction!
Or dont they have those over there?

[kennas]

Good luck Kennas.

Just think Tax deduction!
Or dont they have those over there?My only income is through investing/trading.

(Plus the drug running though Mexico which I won't declare, of course)

Tax deductions from Lima?

My laptop, internet connections, etc, and maybe the donkeys for supply across the Danien Gap.

:eek7:

[jono1887]

My only income is through investing/trading.

(Plus the drug running though Mexico which I won't declare, of course)

Tax deductions from Lima?

My laptop, internet connections, etc, and maybe the donkeys for supply across the Danien Gap.

:eek7:

you can roll it over and deduct from next years profits cant you?

[MRC & Co]

Some would not consider it tiny.

Sorry, wasn't meant to sound like it's tiny, only stating it's small relative to your net wealth.

Yeh, futures.

[kennas]

you can roll it over and deduct from next years profits cant you?Yes, but who is to say? I still have a couple of months to make some money back too, which will be hard because I'm spending May in Mexico. Anyway, I'm hoping just to break even, which will be nice considering. There could be a nice outlier in my sights that brings home the bacon, so who knows. I'm happy to be still floating right now. Set for the next wave. :)

[craigj]

i m a newby started in sept buying stocks and selling them for a profit or holding if making a loss
currently holding acrux fmg and lei as losses and sold sundance at loss to start reducing capital gain
dollar cost averaged gmg and wes to make a profit

current closed trades and dividends up around 18g
open portfolio down 8g
so up 10g all from last 3 months

[sammy84]

i m a newby started in sept buying stocks and selling them for a profit or holding if making a loss

If I am reading this right you are selling your winners and holding your losers?If so you are setting your self up for disaster

[tech/a]

Dollar cost averaging---always a winner!

Cut your winners and let your losers run adding as they do.
After all doubling your holding halves the loss--doesnt it?

I mean they cost me $1.00 dropped to 50c I double the number of shares hey presto they now owe me only 75c.

Who needs Reward to Risk ratio's?
Brilliant.

[craigj]

in this market i am happy to sell my winners and take a profit
28 trades closed and 25 have been profitable and one breakeven.
bhp nab ipl awe cba to name a few only cba i got out too early 26.8 to 31.3
currently hold 16 stocks that owe me 8g 5 of these are in profit 8 in loss and 3 new holdings

[jono1887]

i m a newby started in sept buying stocks and selling them for a profit or holding if making a loss
currently holding acrux fmg and lei as losses and sold sundance at loss to start reducing capital gain
dollar cost averaged gmg and wes to make a profit

current closed trades and dividends up around 18g
open portfolio down 8g
so up 10g all from last 3 months

if you dont mind me asking, how much capital did u start off with??
and why dont you use stop loss orders to prevent you from being that far behind

[Julia]

Dollar cost averaging---always a winner!

Cut your winners and let your losers run adding as they do.
After all doubling your holding halves the loss--doesnt it?

I mean they cost me $1.00 dropped to 50c I double the number of shares hey presto they now owe me only 75c.

Who needs Reward to Risk ratio's?
Brilliant.
Um, Tech, someone might take this seriously!

[jono1887]

Scalping the Hang Seng if I remember rightly.

would someone mind explaining how 1k was turned to 50k by doing this?? :confused:

[beamstas]

Like my mates at work

"Why'd you sell that! Now you've made a loss! Should of waited for it to go back up!"


Classic


Ok seriously..

.. let's sort one thing out

The market doesn't owe you anything
The market doesn't care if you go broke
The market won't give back your money just because you've lost it

Don't let the market manage your risk
Manage it yourself

[ivant]

wow, i never realised those kind of returns were possible :eek:

Yea you can with futures. They are leveraged and you need to take a lot of risk!


Don't worry about 'what is regarded as a good return' as per your initial question and post in the thread. Work out how you can be the best you can be without any limits of the imagination, most will regard it as impossible, because in their perceptions, it is and for this reason, they will never achieve it.

And I wouldn't say you have to be a rigid, dispassionate scientist, but you have to have conviction in yourself and the ability to keep a positive mindset, because there will be times and many of them, when doubt creeps into even the most confident of minds.

Personally, I would say, the life of a trader is a constant evolutionary process. You never reach your destination.

Like always, only my opinions of course, which are based off my own perceptions, whilst trying to form no opinion! ;)

If I may also add to this, you will need to find a style that will fit in with the type of person you are. How much risk you want to take, how systematic you want to be, how often you want to trade, how much do you want to risk per trade, etc...Only your psychological profile and knowledge of yourself will be able to determine what works. This part can take time!


none of the replies have actually answered the question asked in this thread... what are ppls current returns for this year??

300 fold.


It's not about this years returns that count.

Would you like to return 100,000% this year, sit around thinking you are the best there ever is and then blow 100,000% next year

I know it's a bad analogy but concentrate on being consistent. It's hard to scope and compare yourself to others by asking them what their return is this year. In theory this year should have been one of the most profitable years for traders in the last 5 years

Brad

I can't believe I agree with Brad again :P haha. You can be right too sometimes, even if not always open-minded :P Just joking man :)


I wouldn't call these safe stocks exactly. FMG and RIO have debt issues and MQG and FXJ are getting hit with the down turn. A safe stock to me is WOW or AGK. However it is likely that these stocks will not visit their lows again if more bad news doesn't come out of the US.

Alot of investors have made money blindly investing, but yes if people used stops then there portfolios woudn't be 40-50% down. Depends on risk profile. People can wait it out, that's if the stock can rise again. I doubt MQG will hit $100 again or whatever it got to.

If I may add to this, no stocks are safe. The only reason we get money for something is because we risk it.


Um, is this thread about current returns for 08/09?

For me, I'm still well down and need to make about $100K in the next 2 months to earn nothing.

Wish me luck! :)

GOOD LUCK!!! A few good months can come out of this... Maybe not on the long side though, at least for a while.


Dollar cost averaging---always a winner!

Cut your winners and let your losers run adding as they do.
After all doubling your holding halves the loss--doesnt it?

I mean they cost me $1.00 dropped to 50c I double the number of shares hey presto they now owe me only 75c.

Who needs Reward to Risk ratio's?
Brilliant.

Bahahaha. Classic post :)


in this market i am happy to sell my winners and take a profit
28 trades closed and 25 have been profitable and one breakeven.
bhp nab ipl awe cba to name a few only cba i got out too early 26.8 to 31.3
currently hold 16 stocks that owe me 8g 5 of these are in profit 8 in loss and 3 new holdings

Good percentage win! What if the market revisits the lows posted a few months back? Where will your stocks be, and how much will you be down? If you are a fundamental trader you will probably know the approximate correlation of each of the stocks you hold, and you will be able to approximate how much you will be down. Be careful of a new leg down.


would someone mind explaining how 1k was turned to 50k by doing this?? :confused:

That was TH. And TH can explain himself :). MRC & CO trades futures :) As i noted before, high leverage, and high return. You risk more than you put in though!


Like my mates at work

"Why'd you sell that! Now you've made a loss! Should of waited for it to go back up!"


Classic


Ok seriously..

.. let's sort one thing out

The market doesn't owe you anything
The market doesn't care if you go broke
The market won't give back your money just because you've lost it

Don't let the market manage your risk
Manage it yourself

Hahaha. I SOLD IT SO THAT I DON'T GO TO THE POOR HOUSE :):) Haha yea it is funny. How much people hate losses... And it is so hard to change your psychology to think otherwise too! Words of wisdom there.




The market doesn't owe you anything
The market doesn't care if you go broke
The market won't give back your money just because you've lost it

[Trembling Hand]

That was TH. And TH can explain himself This drivel will cover it.

http://www.aussiestockforums.com/forums/showthread.php?t=12683



You risk more than you put in though! Some may but not everyone who trades futs does.

[Mr J]

in this market i am happy to sell my winners and take a profit

You should be trying to maximise profit, while also minimising losses.


Like my mates at work

"Why'd you sell that! Now you've made a loss! Should of waited for it to go back up!"

God bless them :).

[ivant]

This drivel will cover it.

http://www.aussiestockforums.com/forums/showthread.php?t=12683

Some may but not everyone who trades futs does.

There we go, thanks for the link :)

I expressed myself incorrectly about risking more than you put in. I was referring to the amount of capital that can potentially be lost. As in referring to the disclaimer about losses that can exceed initial deposits. Lol, i still can't express myself correctly.

[Trembling Hand]

I expressed myself incorrectly about risking more than you put in. I was referring to the amount of capital that can potentially be lost. As in referring to the disclaimer about losses that can exceed initial deposits. Lol, i still can't express myself correctly.

yeah fair enough but in a way that shows that you're not thinking about position sizing. I don't give a toss what margin the broker asks for to open a position.

The old saying minimum margin = minimum brains.

If you think margin has anything to do with position sizing well that's cuz you haven't seen :fan

[ivant]

yeah fair enough but in a way that shows that you're not thinking about position sizing. I don't give a toss what margin the broker asks for to open a position.

The old saying minimum margin = minimum brains.

If you think margin has anything to do with position sizing well that's cuz you haven't seen :fan

LMAO!!! I love that emoticon! Actually my whole strategy is based on position sizing, and I know what you mean ;). But on a different note, I was reading that post you linked to (i haven't seen it before) I am amazed at the amount of executions haha. You do more trades in the open than i do in half a year! Although you are a scalper and I trade direction. Were you a cowboy in your previous life? :)

[jono1887]

ok, ive read the first several pages of that thread and im still a little confused. heres what ive got so far..

- he trades in first 20 min of opening and last 20min before closing
- manages to make a trade every 30sec in that time period
- uses market depth to make his decisions :confused:
- how is this highly risky if he only started out with 800 capital?? :confused:
isnt he only risking that 800?
- is it possible for me to use that same system? or is more experience required before i start with cfd's

[Mr J]

is it possible for me to use that same system?

I'm sure you can use it (if TH were willing to divulge), but results may vary!

[alwaysLearning]

- how is this highly risky if he only started out with 800 capital?? :confused:
isnt he only risking that 800?


uhm lol. TH is a freak. It is extremely risky because 99.9% of other traders will blow the entire $800, or whatever he started with in no time if they try to trade the way he does, without sufficient/similar experience.

See if you can open a free demo account (simulation account) and try it out yourself.

[craigj]

thanks people for your concern my philosophy is to get on a smaller company with buying support and ride it up a little and get out before others dump it

for larger cap stocks with good fundamentals i am happy to hold if they drop
i will dollar cost average if they fall seriously
wesfarmers bought at $27 then $18 and took up the $13.50 offer
averaged at $19.12

sold my $27 parcel at $20 so take a capital loss on stock for finnacial year but still a profitable overall trade

[sammy84]

Great philosophy. You cant lose. Either you cash out or never crystalize your loss, cant lose. Seriously, take some advice from some more experienced traders like Tech/A and TH, this way of trading will ultimately result in disastrous consequences.

[Mr J]

sold my $27 parcel at $20 so take a capital loss on stock for finnacial year but still a profitable overall trade

Until your $13.50 half starts dropping. You simply doubled down on a losing trade, hoping it would turn around. Fortunately for you it has so far, but what if it hadn't?

[Trembling Hand]

thanks people for your concern my philosophy is to get on a smaller company with buying support and ride it up a little and get out before others dump it

for larger cap stocks with good fundamentals i am happy to hold if they drop
i will dollar cost average if they fall seriously
wesfarmers bought at $27 then $18 and took up the $13.50 offer
averaged at $19.12

sold my $27 parcel at $20 so take a capital loss on stock for finnacial year but still a profitable overall trade

In hindsite of course you would say no now but was FMG a "larger cap stocks with good fundamentals "

[ivant]

In hindsite of course you would say no now but was FMG a "larger cap stocks with good fundamentals "

Love the post :)

[Mr J]

Mmm. Good example of the pain of trying to turn a loser into a winner. In a game that allows extreme movement either way, I would've thought letting winners run and cutting losers short would be the logical way to go :eek7:.

[sleepy]

uhm lol. TH is a freak. It is extremely risky because 99.9% of other traders will blow the entire $800, or whatever he started with in no time if they try to trade the way he does, without sufficient/similar experience.

The real reason 99.9% would fail using TH's method is that they would NOT be prepared to do the work to learn and practise the necessary skills needed (i.e, deliberate practise). Nor would they constantly review each and every trade, etc.


You have to practise, practise and then practise some more. Its all about screen time, years off it.

sleepy :D

[tech/a]

I would've thought letting winners run and cutting losers short would be the logical way to go

Logical yes.

The real question for EVERY trader to answer with regard to your logic (Whether they agree or not) in both Hold or Sell is.

WHEN

[jonojpsg]

Hey jono,
I started trading seriously in 2005 and made 150% (20k to 50k) over the next 18 months. Was stoked obviously but come end 2007 I made a couple of MAJOR mistakes, ie NOT USING STOP LOSSES!!!!! Rode AED all the way down and lost 10k, then stupidly thought that CIty Pacific was a good buy at $2ish and rode it down, currently my 12k in that trade is worth about $500:banghead::banghead:

So I must add my support to the MUST CUT LOSSES and ride winners crew.

Oh, and I think for the 08/09 year so far I am running somewhere in the negatives (~-20%), mainly because of the CIY and AED trades.

my :2twocents

[beamstas]

thanks people for your concern my philosophy is to get on a smaller company with buying support and ride it up a little and get out before others dump it

for larger cap stocks with good fundamentals i am happy to hold if they drop
i will dollar cost average if they fall seriously
wesfarmers bought at $27 then $18 and took up the $13.50 offer
averaged at $19.12

sold my $27 parcel at $20 so take a capital loss on stock for finnacial year but still a profitable overall trade

Let me get this straight

Bought 1 lot at $27
Bougth 1 more lot at $18
Bought 1 more lot at $13.50

That's epic, epic, epic averaging down. I really hope this works for you every time. Cause the day it doesn't work your going to lose the lot :(



sold my $27 parcel at $20 so take a capital loss on stock for finnacial year but still a profitable overall trade

How can you make a capital loss on a trade that is profitable?
Can you please fill me in
Im sure a few of my clients will be happy to know they can do this!

[So_Cynical]

Its all a matter of "WHEN"

Stocks go up and down all the time....all the short term traders posting here
have sold XYZ at a small loss only to see it turn around a day or 2 later.

Averaging down works, most of the time, given time, if you've got the time....and do it with a plan.

[Mr J]

Logical yes.

The real question for EVERY trader to answer with regard to your logic (Whether they agree or not) in both Hold or Sell is.

WHEN

When to let winners run and cut losses short? I don't think so, as I think it is always the aim of a good trader. I say the real question is why. If done for the right reasons, letting losses run may in fact be letting winners run (if we think a trade needs more room to move), and cutting winners short may in fact be cutting losses short (if we think that the trade has run its course).

[MichaelD]

Stocks go up and down all the time....all the short term traders posting here
have sold XYZ at a small loss only to see it turn around a day or 2 later.

Yep, and back in they go again, capital intact, a few days later.



Averaging down works, most of the time, given time, if you've got the time....and do it with a plan.
Yep, it works most of the time, given time, until it doesn't...and then it blows your account up.

Meanwhile, those controlling losses just keep taking small hits, waiting for the big home runs to come home and pay for the bacon.

[nunthewiser]

In hindsite of course you would say no now but was FMG a "larger cap stocks with good fundamentals "

LOL sorry mate i totally disagree

FMG always been a dog of a co run by a spindoctor :D thas all


great trade stock tho

[tech/a]

When to let winners run and cut losses short? I don't think so, as I think it is always the aim of a good trader. I say the real question is why. If done for the right reasons, letting losses run may in fact be letting winners run (if we think a trade needs more room to move), and cutting winners short may in fact be cutting losses short (if we think that the trade has run its course).

You say why I say when.
The why needs a point in time which becomes the when.(Decision time).
Who's on first?

[Nero64]

In hindsite of course you would say no now but was FMG a "larger cap stocks with good fundamentals

I don't think you can compare FMG and Wesfarmers. Yes both have debt but Wesfarmers has liquid assets that it can generate cash from quickly.

FMG hit $13 on a lot of speculation. It hadn't even sent its first shipment of iron ore yet.

I agree averaging down can be risky even on defensive stocks such as TLS.

[Mr J]

You say why I say when.
The why needs a point in time which becomes the when.(Decision time).
Who's on first?

"When" and "why" necessitate each other, but I'm talking about the quality. I think a quality "why" leads to a quality "when", but not vice versa, as without a quality "why", one doesn't know at what point in time "when" becomes quality. However, with a quality "why", the "when" falls into place.

[jono1887]

Hey jono,
I started trading seriously in 2005 and made 150% (20k to 50k) over the next 18 months. Was stoked obviously but come end 2007 I made a couple of MAJOR mistakes, ie NOT USING STOP LOSSES!!!!! Rode AED all the way down and lost 10k, then stupidly thought that CIty Pacific was a good buy at $2ish and rode it down, currently my 12k in that trade is worth about $500:banghead::banghead:

So I must add my support to the MUST CUT LOSSES and ride winners crew.

Oh, and I think for the 08/09 year so far I am running somewhere in the negatives (~-20%), mainly because of the CIY and AED trades.

my :2twocents

man thats got to seriously hurt!! at what % of the buy price should you put stop losses? and do they charge extra for using them?

[tech/a]

"When" and "why" necessitate each other, but I'm talking about the quality. I think a quality "why" leads to a quality "when", but not vice versa, as without a quality "why", one doesn't know at what point in time "when" becomes quality. However, with a quality "why", the "when" falls into place.

Quality is subjective.
You dont know how good quality is until a time after when.
Why is a call to action.
When is action.

If action (why) is never taken then you dont have a when.

[MS+Tradesim]

It's basic human nature to want to know how you are performing relative to others. But I suggest it's more useful to compare yourself with yourself. Track all your own stats and look for trends. Perhaps you let your losses run too much. Cutting them in half will have a significant effect on your bottom line. Perhaps you cut winners too quickly. Again, adjusting that will improve your results.

You might experience a string of losses (or abnormal profits). There might be a couple of large losses or large profits. Has something in the markets changed? Or are you trading differently? You should be keeping a close eye on these kind of data. How else can you improve your performance as a trader?

As an example, I've been live testing a new system on a new market for the last 6 weeks or so. This week I just upped the position size to what it should be and got 3 losses straight up. It wiped out all of the profits plus more on what I'd built up so far for that strategy. But that doesn't bother me because I know it was just a result of the increased position sizes plus bad luck to get a 3 loss run at that exact point.

Also, a windfall profit is just as much a warning signal as a large loss. Maybe you risked too much on that trade and just got lucky. It might be a sign to scale back risk. If the trade was according to your strategy then great.

For each system I run, I record these statistics:

Wins
Total Winnnings
Ave Win (AW)

Losses
Total Losses
Ave Loss (AL)

W:L = AW/AL
Prob.Win (PW)
Prob.Loss (PL)
Expectancy = (AW*PW)-(AL*PL)

Win Streak
Loss Streak
Net Profit (overall P/L)
Profit Factor = Gross Profits/Gross Losses (how comfortable the system is to trade)
Profit Index = Net Profits/Gross Profits (the efficiency of the system in extracting profit)

I graph the equity curves, weekly returns, yearly returns and plot the R returns (return relative to amount risked - this normalises returns). I look for trends in the data and in behaviour. Based on this, you can also objectively decide what systems to discard or what can be tweaked.

All of this helps focus my attention on what I need to improve and what good habits I need to reinforce.

[Trembling Hand]

Good post MS+Tradesim

[helicart]

I graph the equity curves, weekly returns, yearly returns and plot the R returns (return relative to amount risked - this normalises returns). I look for trends in the data and in behaviour. Based on this, you can also objectively decide what systems to discard or what can be tweaked.

And you can even run monte carlo simulations (http://users.on.net/%7Ethefirstbruce/Position%20Sizing%20lognormal.zip) on such data to suss your risk of blowing up some time in the future...

http://users.on.net/%7Ethefirstbruce/MC%20Sim.gif

[Mr J]

Quality is subjective.
You dont know how good quality is until a time after when.
Why is a call to action.
When is action.

If action (why) is never taken then you dont have a when.

Which is why I said they necessitate each other, but my point is that a quality "why" - "why" meaning good underlying trading philosophy - is what is important, as quality "whens" will naturally follow.

[jonojpsg]

man thats got to seriously hurt!! at what % of the buy price should you put stop losses? and do they charge extra for using them?

The "standard" trading figures are risk 1-2% of your capital on any one trade. This means if you put 10% of your capital into say BHP at $30, and you are willing to lose/risk 1% (of capital) this is 10% of your trade or $3. Hence you put your stop loss at $27. Comsec charge you $10 for an executed stop loss.

Many other ways of doing it, eg technical/chart indicators, support/resistance, etc. but it SHOULD come back to how much you are willing to lose on each trade. I am still :banghead: making trades without stop losses and it's something that I really need to get over, thinking that I know better and that this time my trade will only go the way I want it to.

In reality, I'm surprised I'm still liquid :confused::eek:

[craigj]

Let me get this straight

Bought 1 lot at $27
Bougth 1 more lot at $18
Bought 1 more lot at $13.50

That's epic, epic, epic averaging down. I really hope this works for you every time. Cause the day it doesn't work your going to lose the lot :(




How can you make a capital loss on a trade that is profitable?
Can you please fill me in
Im sure a few of my clients will be happy to know they can do this!

have sold the $27 parcel at $20 x 300 shares = loss of $2100
my dollar cost aver. was 19.14 so am reducing my holding and wes is still a profitable trade


to the others i bought fmg at 4.8 it was the 3rd stock i ever bought and i have learnt the hard way about trying to catch a falling knife i will have to sell before june 30 for the capital loss unsure whether i will buy back in
always felt to much risk with this stock to dollar cost average

[johannlo]

You're doing great mate

I entered in Jan with a similar amount but made the mistake of being too conservative and also sold a bunch of smaller picks at 10-20% (which have subsequently doubled lol). I really wandered into it thinking 'as long as its more than a fixed deposit I'm doing alright' mentality + 'how much worse can it get'.

Fortunately I started getting into it and in early April I shifted half of my portfolio onto small mid-cap explorers and am sitting on ~15% up including reinvesting everything I made and dividends. So your 50% is awesome to me :)

Still there's a few horses left in the 'is it breaking out' pile so hopefully this rally can continue, then I can re-learn the painful 'do I sell now' dilemma

[craigj]

with the do i sell it now dilemma

sometimes i will sell half realise a gain and then monitor the price the next few days to see whether the price is still running or if profit takers are coming in

doing this with ROC at the moment

[jono1887]

sometimes i will sell half realise a gain and then monitor the price the next few days to see whether the price is still running or if profit takers are coming in

How do you tell the difference??? :confused:

[Julia]

How do you tell the difference??? :confused:
What do you think will happen if profit takers move in, jono?

[jono1887]

What do you think will happen if profit takers move in, jono?

Umm.. the price will drop again...
So essentially you don't know, you sell half, and hope for the best that it will continue to rise??
so if: Profit takers come in - drop
Price is actually rising - up

[johannlo]

Its basic hedging your bets, kinda like the reverse of doubling down. Good tip. I already did this with my Toll shares and thank god as they bounced up a dollar literally an hour after I sold half to reallocate into miners. After doing nothing for 6 months + no major announcements = confusion for this small time newbie

[craigj]

yes it is reverse of price averaging in it reduces the variation in profit margin due to timing we cant all pick when a share is at its high and it is the perfect time to sell

bought into ROC at .41 rose sharply last week sold half at .595 and the other half at .645 on friday average is .62

initally it got to .66 intraday but was at work saw .595 as good chance to lock in half profits and psychologically once you have locked in half profits you are not so jittery when price drops to .55

[Loose]

There should always be room in your trading sytem to average down, I'm sure most on here have done it at least once. The important thing is to do it for the right reason. If you still have confidence in the fundamentals of a company and have legitimate reasons to trade then do it. Having said that setting a stop loss should be on top of your list as must do's otherwise it could all go up in smoke.
As far as returns for this year go there would be a range of -30% to sky is the limit around here so try not to consider what other people are achieving, focus on your own methods, chart your progress and remember you never stop learning.

Good luck

[beamstas]

There is a quote in Guppys book

It goes something like this

"Never,Never Ever average down

[mazzatelli1000]

The important thing is to do it for the right reason. If you still have confidence in the fundamentals of a company and have legitimate reasons to trade then do it.

Good luck

Sorry for the cliche - but the market may stay irrational longer than one stay's solvent.

Averaging down - done this before and found my maximum allocation was in a losing position
Prefer to put on full allocation and scale out depending on legitmate reasons
:2twocents

[jono1887]

There should always be room in your trading sytem to average down, I'm sure most on here have done it at least once. The important thing is to do it for the right reason.

I've done twice and it can be a useful tool in increasing profits... but i do see the point in having a majority of your capital in a loosing stock... got to use it in the right situations i suppose

[anthonyriley]

hey guys! many of u trade CFD's if so you will know results like 1000% arent impossible, you really need a structured trading plan and the right mentality/mind frame. And when u consider u can get margins on the major index cfds of like 0.5% thats a lot of potential! :D

[jono1887]

hey guys! many of u trade CFD's if so you will know results like 1000% arent impossible, you really need a structured trading plan and the right mentality/mind frame. And when u consider u can get margins on the major index cfds of like 0.5% thats a lot of potential! :D

It also gives you the potential to loose like 1000% aswell doesn't it? With a CFD, wont one person in the transaction always be loosing out whilst the other makes the profits??

[MRC & Co]

It also gives you the potential to loose like 1000% aswell doesn't it? With a CFD, wont one person in the transaction always be loosing out whilst the other makes the profits??

Na, everyone gets a car like the one in anthonyrileys pic! ;)

[jono1887]

Na, everyone gets a car like the one in anthonyrileys pic! ;)

If only life was truly like that :D:D
We can only dream i guess...

[anthonyriley]

I agree with what u guys are saying, but the isnt the key to have a trading plan. Shouldnt we all be aiming to make a profit. . . if so why is everyone always worrying about stop losses as if they automatically think they will make a losing trade. For the me they key is to know ur stuff inside and out, live it basically and then when u trade you dont have to second guess yourself. If you have backtested and backtest and live tested ur strategy and it works then why cant you achieve results of 1000% increases.

[anthonyriley]

It also gives you the potential to loose like 1000% aswell doesn't it? With a CFD, wont one person in the transaction always be loosing out whilst the other makes the profits??

Also think of it like a sport. . . .you arent exactly gonna out in a soccer world cup final as a goalkeepern be like OMG how many goals am i going to let in or how unprepared i am. . . .your gonna go in with confidence and know and see the victory if your not then its a waste of time really.

[MRC & Co]

Also think of it like a sport. . . .you arent exactly gonna out in a soccer world cup final as a goalkeepern be like OMG how many goals am i going to let in or how unprepared i am. . . .your gonna go in with confidence and know and see the victory if your not then its a waste of time really.

LOL, so now the average CFD punter has the equivelent skills of a WC goalkeeper?

Know your stuff inside out you say and live it. What does that mean?

Or a backtested system which shows 1000% returns with decent risk management so you don't blow up, wonder how many have that?

Trading is HARD, doing it as a novice on a CFD account is almost infinately HARDER!

Stop giving false hopes.

[anthonyriley]

LOL, so now the average CFD punter has the equivelent skills of a WC goalkeeper?

Know your stuff inside out you say and live it. What does that mean?

Or a backtested system which shows 1000% returns with decent risk management so you don't blow up, wonder how many have that?

Trading is HARD, doing it as a novice on a CFD account is almost infinately HARDER!

Stop giving false hopes.

Average CFD punter? if your refering to me, i may be new to the site but i do know whats going on. if someone is an average CFD punter they are then clearly not a trader, and are mearly gambling.

And what i meant by the sports thing is that your not going to go into something without knowing what your doing are ya,

and by know ur stuff inside out i mean know your strategy, if you have no strategy then how do u know when to enter and when to exit not to mention control your emotions. most people lose money caus of emotions! by having a plan and ppts in place you are limiting to those emotions.

to me trading is only as hard as you make it. anyone can make up excuses as to why they are doing well or not so well but in the end we have ourselves to blame.

[ColB]

Originally posted by AnthonyRiley

"...anyone can make up excuses as to why they are doing well or not so well but in the end we have ourselves to blame..."

Damn it! I'm going so well because I didn't get enough sleep last night:confused:

[MRC & Co]

I'm not saying 1000% is not possible, or that you are an average punter.

Your posts make it sound easy to me, when it's not. Possible, on a small account yes, easy? Not for most.

[Trembling Hand]

most people lose money caus of emotions! by having a plan and ppts in place you are limiting to those emotions.


So most people who lose have a sound positive expectancy system with skill to apply it but lose money cuz they forget this and become emotional!! :rolleyes:

[JimBob]

Also think of it like a sport. . . .you arent exactly gonna out in a soccer world cup final as a goalkeepern be like OMG how many goals am i going to let in or how unprepared i am. . . .your gonna go in with confidence and know and see the victory if your not then its a waste of time really.

If you never let in any goals, then you can never lose a game. I think the whole point is how much you lose is something you can control.

[MS+Tradesim]

Is it just my imagination or has the number of expert traders on this site suddenly ballooned during this rally? We must be at the top.

[sammy84]

Shouldnt we all be aiming to make a profit. . . if so why is everyone always worrying about stop losses as if they automatically think they will make a losing trade.

Part of knowing your plan is also excepting losses will inevitably result. I understand my edge will produce winners, however I have losing trades.

Good quote by Marty Schwartz;
”When I became a winner I went from 'I figured it out, therefore it can't be wrong' to 'I figured it out, but if I'm wrong, I'm getting the hell out, because I want to save my money and go on to the next trade.”

[nunthewiser]

Is it just my imagination or has the number of expert traders on this site suddenly ballooned during this rally? We must be at the top.


bingo...

i did point out the top .at the top

lol but pay no heed im just skiting because it annoys a few here that i maybe right at times

[Mr J]

I agree with what u guys are saying, but the isnt the key to have a trading plan. Shouldnt we all be aiming to make a profit. . . if so why is everyone always worrying about stop losses as if they automatically think they will make a losing trade. For the me they key is to know ur stuff inside and out, live it basically and then when u trade you dont have to second guess yourself. If you have backtested and backtest and live tested ur strategy and it works then why cant you achieve results of 1000% increases.

Yes, the idea is to profit, but it's hard to execute well without a plan. Bowlers don't just bowl, they plan their line and movement. Footy teams don't just try to run over the top of each other, they try and create a gap in the opposition's defensive line. Soldiers don't just shoot. Most activities benefit from planning, and no matter how talented someone is, they will very likely do better when equipped with a good plan.

Stop losses is about risk management. The idea of the stop is to protect your capital from fast, large moves, but also to set a point where we decide the trade is no longer working. A stop doesn't suggest that we think we will lose this trade, just that we know we may lose on this trade.


For the me they key is to know ur stuff inside and out, live it basically and then when u trade you dont have to second guess yourself

Humans rarely take action without a plan, regardless of how well-thought out. It may be as simple as you take a trade if you like it and exit when you no longer like it. It's a simple plan, but it's still a plan. Second-guessing yourself isn't a problem if it is in a positive way, and since markets are dynamic, perhaps it's necessary to second-guess in a positive fashion.

[nunthewiser]

for ME . no matter what trade i enter .BEFORE i enter it i work out how much im going to lose .......... dunno about anyone else , just speaking for my own thoughts

[MS+Tradesim]

for ME . no matter what trade i enter .BEFORE i enter it i work out how much im going to lose .......... dunno about anyone else , just speaking for my own thoughts
I'd say most sensible traders would agree.

[beamstas]

The market doesn't give a crap how positive you are that your trade is going to be successful

[anthonyriley]

all i can say is everyone has their own opinions, thats mine i guess in the end is if what we do works then who gives a crap what others think . . . .

[MRC & Co]

all i can say is everyone has their own opinions, thats mine i guess in the end is if what we do works then who gives a crap what others think . . . .

If trading is truly only as easy as you make it for yourself as you say, then damn right, enjoy your car and the billions that come with it!

[nunthewiser]

all i can say is everyone has their own opinions, thats mine i guess in the end is if what we do works then who gives a crap what others think . . . .


hi . any chance of you posting some live entrys in the future .NOT hindsight trades , i mean as you enter them .......could be intresting as its mighty easy to say how great we are AFTER the fact but in real time it proves a point or 2

thankyou in advance

p.s reiterates that hindsight trades will be laughed at as they a dime a dozen these days ... everyones a guru

p.s will even start a live trade thread for ya if you so wish OR pick any thread it may concern .take your pick

[anthonyriley]

If trading is truly only as easy as you make it for yourself as you say, then damn right, enjoy your car and the billions that come with it!


I say this because some people may have a system that uses basic charting etc and it works and they do well whilst others complicate it and make a chart look to confusing when maybe a similar strategy could be a better way .. . . .look at the chart below. . .. thats what i mean by over confused . . . how many of you can tell me you have charts like that . . .. or how many of u can tell me that this chart is making trading hard on yourself.

[beamstas]

all i can say is everyone has their own opinions, thats mine i guess in the end is if what we do works then who gives a crap what others think . . . .

Just a suggestion
Maybe you should start trading using real money

Your confidence may be a little different when moving up to real money from paper trading :)

[anthonyriley]

Just a suggestion
Maybe you should start trading using real money

Your confidence may be a little different when moving up to real money from paper trading :)

I have used real money . . . . . i wouldnt have opened my mouth if i hadnt, because i know from my experience that its much much more mind intense.

[MRC & Co]

I say this because some people may have a system that uses basic charting etc and it works and they do well whilst others complicate it and make a chart look to confusing when maybe a similar strategy could be a better way .. . . .look at the chart below. . .. thats what i mean by over confused . . . how many of you can tell me you have charts like that . . .. or how many of u can tell me that this chart is making trading hard on yourself.

My charts show price and volume and I draw a few levels in myself.

Very simple.

Doesn't make trading and achieving 1000% returns easy though!

The market dictates a lot of the time, how easy it is or not, sometimes it gives away free money, other times you have to work hard for your scraps!

[beamstas]

Shares, thats about it, but ive been using trials for a number of months, and now am getting ready to trade using more real cash. CFD's really only get dangerous when you have no set trading plan or no PPT and you let your emotions drive your trading. In my case the main thing i have to focus on is patience, just being able to wait till the market gives me the opportunity and not trying to create one. I guess as long as you are aware of the structure of a CFD and the risk its ok. :):)

Okay Mate.





Anyway...
"Is it just my imagination or has the number of expert traders on this site suddenly ballooned during this rally? We must be at the top. "
I agree. :)

One of my trading systems has gone nuts
This is the return from 01/04/2009 to 11/05/2009 using only a 2% risk (fixed fractional position sizing) and no leverage
http://i41.tinypic.com/1jsxll.png

It's not that the system is good
It's just that the market has moved crazy fast

Cheers
Brad

[anthonyriley]

My charts show price and volume and I draw a few levels in myself.

Very simple.

Doesn't make trading and achieving 1000% returns easy though!

The market dictates a lot of the time, how easy it is or not, sometimes it gives away free money, other times you have to work hard for your scraps!


I agree. . . .and i didnt say 1000% returns were easy if so why isnt everyone doing it . . . i was mearly saything they are possible. . . . . .and i was saying you have id say more chance achieving them then with stocks. . .. im not saying it will always be the case but more often then not. . . . . and by work hard what do you mean? to me the market presents an opportunity to us and we take it or leave it. . . .?

[MS+Tradesim]

Nicely done there Brad.

[beamstas]

Nicely done there Brad.

Thanks :)

Just proving the point that you dont need the 'holy grail' to achieve 1000's of % return

All you need is the market to move fast enough LOL!

[nunthewiser]

oh pulleeeeeze guys :D dont u all go turning from bulls back to bears again i still got bleedin shorts open and its to early to go long yet :D


i take it mr riley dont want a live trade thread opened for him as its easier to type in here how great we are instead

[anthonyriley]

fair enough . . . .and trust me i know im no professional trader im far far farrrrr from it. . . i mearly have given my input into the conversation . . . . i would say many of you are more then likely more advanced and experienced traders then i could ever be . . . .

i just dont get why everyone is being negative on the idea that you can make money in the market caus bottom line is thats what this whole thread is about . . . . .

im not saying its easy money but its easier then working many jobs. . . .

if its so hard why do we do it. . . .. . . we must see something there that makes us want to do it . . . . . and somebody mentioned it gets harder when u trade with a larger account . . .. id only agree due to the fact it might be more emotional . .. but. . . . would you be using the same strategy and just buying more contracts or shares. . . ..

[anthonyriley]

oh pulleeeeeze guys :D dont u all go turning from bulls back to bears again i still got bleedin shorts open and its to early to go long yet :D


i take it mr riley dont want a live trade thread opened for him as its easier to type in here how great we are instead



relaxxxxx

[nunthewiser]

fair enough . . . .and trust me i know im no professional trader im far far farrrrr from it. . . i mearly have given my input into the conversation . . . . i would say many of you are more then likely more advanced and experienced traders then i could ever be . . . .

i just dont get why everyone is being negative on the idea that you can make money in the market caus bottom line is thats what this whole thread is about . . . . .

im not saying its easy money but its easier then working many jobs. . . .

if its so hard why do we do it. . . .. . . we must see something there that makes us want to do it . . . . . and somebody mentioned it gets harder when u trade with a larger account . . .. id only agree due to the fact it might be more emotional . .. but. . . . would you be using the same strategy and just buying more contracts or shares. . . ..

yes dewfinately money to be made but also there is losses and unless you know how to look after ya losses you aint gunna m ake money ...simple

um trading l;arger accounts got zilch to do with emotion , its all to do with liquidity .. one mans million is another mans lunch money

[sammy84]

id only agree due to the fact it might be more emotional . .. but. . . . would you be using the same strategy and just buying more contracts or shares. . . ..

Its harder because your trades alone will move the market, not that I have that problem...yet :D

Out of curiosity how long have you been trading? And during that time what has been your largest drawdown? I'm not asking these questions as a dig, just curious because its when your going through that drawdown when you realize trading isn't easy money.

[anthonyriley]

Its harder because your trades alone will move the market, not that I have that problem...yet :D

Out of curiosity how long have you been trading? And during that time what has been your largest drawdown? I'm not asking these questions as a dig, just curious because its when your going through that drawdown when you realize trading isn't easy money.



ive not been trading for long . . . approx 1 year or so . . . and yes ive lost money and ive lost a bit . . .for me anyway . . . but ive learnt alot and those losses made me better . . . . because then i was always like wow wow wow i made a profit now its like i should be making a profit because really thats why im doing it and now im like why why why did i make a loss.....

just outta curiosity does anyone else use cameron mitchells way of trading . . . . .

[anthonyriley]

btw if anyone does use cam mitchells way of trading whats their win loss ratio?

[jono1887]

Okay Mate.





Anyway...
"Is it just my imagination or has the number of expert traders on this site suddenly ballooned during this rally? We must be at the top. "
I agree. :)

One of my trading systems has gone nuts
This is the return from 01/04/2009 to 11/05/2009 using only a 2% risk (fixed fractional position sizing) and no leverage
http://i41.tinypic.com/1jsxll.png

It's not that the system is good
It's just that the market has moved crazy fast

Cheers
Brad

2300% annual return :eek::eek: HOW??

[nunthewiser]

2300% annual return :eek::eek: HOW??

using a demo account or with paper trades otherwise he would have posted actual statements

looks good tho and good luck to him if it works with actual cash

[beamstas]

using a demo account or with paper trades otherwise he would have posted actual statements

looks good tho and good luck to him if it works with actual cash

The results shown are in amibroker you idiot

Currently validating this system on another forum

The trades are all viable, with no looking forward. The result is also not an anomily in the data, as i use the best data you can get. The result has not been curve fitted at all.

[nunthewiser]

The results shown are in amibroker you idiot

Currently validating this system on another forum

The trades are all viable, with no looking forward. The result is also not an anomily in the data, as i use the best data you can get. The result has not been curve fitted at all.

EXCUSE ME??? "idiot"??? WTF?

i do not use amnibroker .......lol no need to get cranky because from where im sitting it looks like a demo /paper trade claim to fame

lol some ppl get so emotional here at times

geeeeez

[beamstas]

EXCUSE ME??? "idiot"??? WTF?

i do not use amnibroker .......lol no need to get cranky because from where im sitting it looks like a demo /paper trade claim to fame

lol some ppl get so emotional here at times

geeeeez

It wasn't a claim to fame
If you read what i was saying i was simply pointing out that in the current market it doesn't take much to achieve 1000's of % returns because of the huge run up we have had recently

If you want to see trades go to my other thread

[cutz]

beamstas,

I haven't checked out your thread but are you using real cash or are you testing a system.

[beamstas]

beamstas,

I haven't checked out your thread but are you using real cash or are you testing a system.

Testing a system &
Using real cash
The FMG trade on my thread was a signal from this system
The system still holds the trade but i have since closed it in my account due to other reasons

As i stated in my thread, i have not been adding new buys because of the fact that i have been changing brokers

Once it's all sorted out and the system has been validated i will start posting live trades if anybody is interested

The reason for me posting was to not show off a trading system - it was to demonstrate the fact that the market has moved so far in such a short time that anybody could make money

The system does not return big results like that consistently, it is just because of the way the market was during april

[jono1887]

You need to be trading CFD to get 1000s% returns right? those returns cant be possible just on stocks :confused:

[beamstas]

You need to be trading CFD to get 1000s% returns right? those returns cant be possible just on stocks :confused:

It is possible
But not probable

The idea of using CFD's isnt to make your positions larger
Just take more signals

[nomore4s]

2300% annual return :eek::eek: HOW??

lol, results from 1 month of trading are always going to skew the annual return. 2300% pa based off 1 months trading is hardly realistic, as Brad had said it is more from the purple patch that the market has had lately.


those returns cant be possible just on stocks :confused:

Why not?

[Aussiest]

i take it mr riley dont want a live trade thread opened for him as its easier to type in here how great we are instead

I'd be tempted to post in a 'live trade' thread :)

[skyQuake]

Have a look at how hard a few of the property trusts have bounced from the lows; eg CER, CNP, MDT etc and you'll see how these returns are easy if you got in early.

Just that everyone's a genius on a bull market! (Or a bear trap rally)

[nunthewiser]

Have a look at how hard a few of the property trusts have bounced from the lows; eg CER, CNP, MDT etc and you'll see how these returns are easy if you got in early.

Just that everyone's a genius on a bull market! (Or a bear trap rally)

yeah not disagreeing that whatsoever at all

its just a poster here was saying at one moment he had got 3k together for an IB account as he under 21 then the next mo he talking about a 100k account , i just figured he was using a demo/papertrade setup

for sure theres been plenny easy gains of late and i dare say we will see a few " what happened ?" posts shortly :D

[Loose]

Testing a system &
Using real cash
The FMG trade on my thread was a signal from this system
The system still holds the trade but i have since closed it in my account due to other reasons

As i stated in my thread, i have not been adding new buys because of the fact that i have been changing brokers

Once it's all sorted out and the system has been validated i will start posting live trades if anybody is interested

The reason for me posting was to not show off a trading system - it was to demonstrate the fact that the market has moved so far in such a short time that anybody could make money

The system does not return big results like that consistently, it is just because of the way the market was during april

Agreed Beamstas, April has been great for most, almost like stealing:)

Jono big returns are there if you look,

Example PBG low of .14 in Feb to current SP of .82 thats 585% from what I would consider a fairly safe play. (No I didn't get in but that's another story)
Others here would have more examples. Are you just trading the bounce, rolling the dice or do you have longer options with fundamental support?

[skyQuake]

i dare say we will see a few " what happened ?" posts shortly :D

haha definitely! :D

If those posters can turn a 3k acct into a 100k acct with leverage i wonder how long will it take them to turn that into a -50k acct :(

[ivant]

Haha what a post! MrC (man what should I call you in this forum? lol) trading is simple as peanuts. what are you talking about. Think about it, March to today, in hindsight I can build 1k with no leverage to 5 billion. It's all THAT easy. :P

It is easy until you blow up anthonyriley. Livermore blew up. Many times. He is only one of the best traders in the world! And do you know where the trick lies, and the difficulty? Adjusting to different market conditions. How do you differentiate a bull market from a bear market rally in a bull? I can tell you 100% that a 20% rally doesn't make it a bull, and even a 200 SMA crossover not always defines it!

[ivant]

yeah not disagreeing that whatsoever at all

its just a poster here was saying at one moment he had got 3k together for an IB account as he under 21 then the next mo he talking about a 100k account , i just figured he was using a demo/papertrade setup

for sure theres been plenny easy gains of late and i dare say we will see a few " what happened ?" posts shortly :D

Doesn't it make me feel better about my shorts! Ha!

[cutz]

Testing a system &
Using real cash
The FMG trade on my thread was a signal from this system
The system still holds the trade but i have since closed it in my account due to other reasons

Hi beamstas,

You mentioned you had to get out of FMG due to other reasons but the system still holds it, do you think this is a fundamental flaw in a paper trading system. i.e. in real life you couldn’t hold on but on the practice system it's still on.

I ask because this week I’ve started intraday trading a volatile stock with no success, I’ve moved onto the stock from trading the options to take advantage of the lower spreads and lower slippage, I’m finding trading the stock to be a lot more difficult, I can’t put my finger on why.

Will paper trading actually better prepare me to trade the real thing or will the emotional detachment cloud my judgment?

Has anyone out there actually moved from a paper trading system to real life trading with no change in the way they trade and with results that were similar to what they were getting on paper?

Hope my questions makes sense.:)

[Trembling Hand]

Has anyone out there actually moved from a paper trading system to real life trading with no change in the way they trade and with results that were similar to what they were getting on paper?


I will answer for everyone...

NO.

[MichaelD]

Has anyone out there actually moved from a paper trading system to real life trading with no change in the way they trade and with results that were similar to what they were getting on paper?

Yes.

(and no).

Yes - My most recent system went from paper trading to real trading with methods and results that remained consistent.

(and no) - Several unexpected wrinkles did appear when trading with real money, all of which were analyzed and learned from and incorporated into the plan. Most of these related to finer points of trade execution in the real market which simply weren't apparent when paper trading. Several of these related to the unanticipated level of stress of trading within a tight timeframe when multiple trades signalled at the same time.

On top of this, it's a feedback loop - I'm now approaching 100 live trades with this system (+ 100 paper trades) and I have several "gut" ideas for how to improve the system, mainly focussed around how to better control the losses and how to increase trade frequency. These were not apparent when paper trading, but became very obvious when trading with real money.

Since I have a good dataset (no violations of trading rules and only one bona fide trading error - one position size too small) I can go back and rigorously apply these "gut" ideas to see if they help and possibly incorporate them into the next 100 trades.

And then rinse and repeat ad infinitum.

[cutz]

Thanks guys,

MichaelD , I noticed you also made mention of wrinkles appearing in the real market from the execution side, are you referring to the fact that when you place your trades you’re actually printing your own bars, something that doesn’t happen when you paper trade.

Are futures more appropriate to day trade due to the fact that it's possible to trade in and out without leaving to many footprints?

[MichaelD]

MichaelD , I noticed you also made mention of wrinkles appearing in the real market from the execution side, are you referring to the fact that when you place your trades you’re actually printing your own bars, something that doesn’t happen when you paper trade.

Some of the things I have become aware of;

1. It's not that hard to move the market with even fairly small position sizes in some shares, even those in the ASX200. Membership of the ASX200 does not automatically equate to plenty of liquidity.

2. Paper trading gives you perfect fills at perfect times, and that's not always the case in the real market.

3. Execution stress is much higher with real money.

4. Practice does help - the more we trade the system, the more routine the executions get and the closer to perfect the executions get.

[cutz]

Hi MichaelD, Thanks for your time.

I actually experienced all those points you mentioned, I normally trade options but this week I thought I try my hand day trading the real thing due to an unexpected assignment, anyhow the stress of execution, especially getting out of a long trade rattled me, the price fell away so I quickly cancelled, I waited and eventually got out after 4, I came out just short of square including brokerage due to a small gap up on the close.

Anyhow due to that experience ( along with a couple of others) I’ve decided day trading stocks isn’t for me, but what I’m getting at is I’ve held stocks for years, I’ve comfortably traded options for nearly 2 years , when it comes down to day trading stocks I fall to pieces , how does someone with no experience come away from paper trading without getting blown up.

[anthonyriley]

Anyone willing to share there methods of picking a trade and when to enter it . . .and i guess when to exit.

[jono1887]

Anyone willing to share there methods of picking a trade and when to enter it . . .and i guess when to exit.

buy when its going down :p::p: hahah, if its cheaper must be good value right??

Looks like the markets going to make back its gains this week so buying anything in general will yield some returns this week...

[anthonyriley]

buy when its going down :p::p: hahah, if its cheaper must be good value right??

Looks like the markets going to make back its gains this week so buying anything in general will yield some returns this week...

Im thinking more along the lines of technical indicators.
Anyone use these. . . .bar analysis, trend, phase and geometric analysis ?

[Aussiest]

I've always wanted a crystal ball. Anyone have one?

[jono1887]

I've always wanted a crystal ball. Anyone have one?

I've got one, I'll sell it to you for the very low price of only 5 payments of 99.95 + 29.95 P&H :p::p:
Pay now with credit card and i'll even throw in a set of free steak knives!!

[Mr J]

Anyone willing to share there methods of picking a trade and when to enter it . . .and i guess when to exit.

Buy the troughs, sell the peaks. That's all I do.


Im thinking more along the lines of technical indicators.
Anyone use these. . . .bar analysis, trend, phase and geometric analysis ?

Honestly, not really. I'll take a glance at the chart and decide what I think is going on. I don't give it much conscious thought.

[kennas]

Buy the troughs, sell the peaks. That's all I do.



Honestly, not really. I'll take a glance at the chart and decide what I think is going on. I don't give it much conscious thought.

Huh?

:confused:

Buy the troughs?

No conscious thought of the charts?

:confused:

[nunthewiser]

:D everyones a winner kennas , didnt u know that m8 ?:D

[Mr J]

Huh?

:confused:

Buy the troughs?

No conscious thought of the charts?

:confused:

Trough = low, which I assume you already know, so why the confusion?

I don't spending much time looking at it, I just take a glance and interpret it subconsciously.


everyones a winner kennas , didnt u know that m8 ?

Perhaps you could find a more productive use of your time.

[beamstas]

I believe buy low sell high is wrong. It's a trap beginners fall into and start to look at "value"

I'll throw this out there

Buy High, Sell Higher

Cheers
Brad :)

[jono1887]

Buy the troughs, sell the peaks. That's all I do.



Honestly, not really. I'll take a glance at the chart and decide what I think is going on. I don't give it much conscious thought.

So your able to subconsciously interpret data without actually thinking about it? :eek: i wish we all had that ability... i suppose your able to analyse movements in your sleep aswell :p:

[Mr J]

Beamstas, I probably should have expanded a little more. I look to buy and sell just after I think a pivot has formed, not buy just because the price currently seems low. 'Value' trades don't come into it, I just seek to ride the waves of price action as they form.


So your able to subconsciously interpret data without actually thinking about it?

We do that for many things in life. We don't think about throwing a ball, we just do it. At some point we may have thought about it, but it quickly becomes automatic. That's how I feel when looking at charts. I'm not saying I'm great at reading charts, just that my thought-process regarding charts is automatic.

[johnnyg]

We do that for many things in life. We don't think about throwing a ball, we just do it. At some point we may have thought about it, but it quickly becomes automatic.

Same can be said about eating food. You dont need to think about picking up the fork and feeding the food into your mouth and then the number of times you need to chew before you swallow. It just happens automatically.

Good Post Mr J. :)

[Adam A]

Same thing with thinking.

Some times i dont even turn my brain on:eek:

[Mr J]

Do something often enough, and we'll become efficient at it. It doesn't hurt that I keep things simple.

[carmen]

EXCUSE ME??? "idiot"??? WTF?

i do not use amnibroker .......lol no need to get cranky because from where im sitting it looks like a demo /paper trade claim to fame

lol some ppl get so emotional here at times

geeeeez

I'm extremely doubtful that's a paper trade claim. All that comes to mind with your post......You obviously have not been long the past three months.

[nunthewiser]

I'm extremely doubtful that's a paper trade claim. All that comes to mind with your post......You obviously have not been long the past three months.


uh?? how did you come up with that deduction sherlock ?

scroll through my posts .PLENTY of trade entrys given , LONG and short actually .........


lol im still wondering how my post indicated anything to do with my trades darl ???

[nomore4s]

I'm extremely doubtful that's a paper trade claim. All that comes to mind with your post......You obviously have not been long the past three months.

um I'm pretty sure Beamsta said it was testing results of a system he is building so technically it is paper trading. I'm sure Brad will correct this if it is incorrect.

[carmen]

um I'm pretty sure Beamsta said it was testing results of a system he is building so technically it is paper trading. I'm sure Brad will correct this if it is incorrect.

If I got that wrong through mis-reading, sorry. To me it was reading about someone achieving 40% over April and thought, yeh sounds about right.


um I'm pretty sure Beamsta said it was testing results of a system he is building so technically it is paper trading. I'm sure Brad will correct this if it is incorrect.


uh?? how did you come up with that deduction sherlock ?

scroll through my posts .PLENTY of trade entrys given , LONG and short actually .........


lol im still wondering how my post indicated anything to do with my trades darl ???

Sorry mate, the comment was not aimed at you personally. It was in response to the argument that such a return had to be a fictitious "paper trade claim to fame".

[beamstas]

um I'm pretty sure Beamsta said it was testing results of a system he is building so technically it is paper trading. I'm sure Brad will correct this if it is incorrect.

Yep

Paper trading it to start for a few months until i know it has positive expectancy forward testing. The reason behind posting the results over april was becuase the system usually returns 30% p.a historically, and it returned over 40% in april - may, quite an astonishing effort on the markets part :)

I do trade and was long over April, but not with the trades on the system. I only added 13% to my account over april (not 40% :( ).

Cheers
Brad