[ItalianSharp]

Originally Posted by darthtradar »

thanks guys, good food for thought.

i'm certainly not a get rich quick type, i actually read books for a year before i felt i could even place my first stock trade.

i guess i will have to see how it goes with a 10 point stop. with this first 5k account i will be looking to get max screen time as opposed to making money. i'm kind of hoping the 10 point stop forces me to only take the best entry point and then 20 points and out will force me from giving things back on a winning trade. I will explore 15 though.

i guess market orders must really suck on TS. would it make more sense to open an account with another broker along with TS? turn 10 trips a month on TS then use the other broker after? is it really that bad on TS? I have heard so much negative stuff about TS as a broker.

It almost sounds like it's an easy task to scalp 20 pts off YM...

Sometimes I have to sit into trades for 20-30 mins only to scalp 5-6 ticks...I wish I had the opportunity to make 20 per each trade...I'd be a millionaire within a year...

From what you are writing, I think you'd be better off demoing for a few months before losing any money. You're going to lose money anyway, but at least you'd have a better idea of what you are doing.

A fixed target /stoploss might be too big in some days and too small in other days. Focus on understanding the market as much as you can. It takes time but it's the best thing you can do.

[Fibtrader]

Darth
Here is what I would do. I can almost gurantee you will blow out a 5,000 account. Trading with one contract will not net enough profit to make up for the stop losses. You should not risk more then 2% to 3% of the account on any trade. A 5,000 account will only allow a stop loss of $100.00 to $150.00 for the entire trade (if two contracts, $50.00 - $75.00 per contract). The market will hit those stops frequently resulting in losses that could have been avoided if the account was funded properly. A 2% to 3% stop loss on a $20,000 account allows a $400 - $600 stop loss. The end result is more contracts being traded. With two or more contracts you will make more money in less time (eliminating the time exposure factor). You won't be able to swing trade a $5000 account, too much time exposure and not enough of a stop loss. NEVER... risk more then 2% to 3% of your account no matter how large it is. I speak from experience, having blown out my account before I got smart.
If you want to trade a $5000 account get the free simulator from www.NinjaTrader.com This will force you to take trades in real time so you can't cheat . Don't risk real money until you can trade "funny" money profitably. The simulator will track all of your trades in its account manager. Make sure you set up the simulator account with $5000. I think it comes set up for a $ 20,000 account. Trade the simulator account exactly as you would a real account. Make sure you set hard stops to keep your losses small, pick a target to get out at and let the market take you out not your emotions. Remember if you are afraid to lose you will never win in the market. If you use Tradestation I would recommend the Market Profiler available on this website. Some platforms offer MarketProfile (eSignal), Tradestation does not, unless you have this add on. The one on this website works very well. I won't trade without it.

Good Trading

Fibtrader

[BlowFish]

Fib welcome to the forums, I am fairly new here myself but its a quality venue.

Isn't the YM 5$ a point? that would allow 10-15 point stops @ 2-3% (if my quick mental arithmetic is not out - it often seems to be nowadays).

The 2-3% rule is a great rule of thumb that people quote to keep other people plunging in the deep end and drowning in a fairly short time. It goes hand in hand with "conventional wisdom" that you should pursue something like a 1:3 risk reward. The key thing really is risk of ruin and the amount at risk on each trade is just one component of this. Obviously if you have a higher percentage of winners in comparison to losers you can put more at risk on each trade without increasing the overall chance of ruin.

Ironically one of the main ways to increase your percentage of winners is widening your stops (in comparison to your target). As you quite rightly point out having stops that are too tight can reduce the efficacy of any method! I linked this in another thread TradersCALM - risk of ruin menu talks about RoR far better than I could.

Cheers,
Nick.

[rolange]

Originally Posted by darthtradar »

how would you setup your first index futures account/strategy/risk management/position size/profit target?

i just closed out my last swing trade today so should be getting setup in the next few weeks. i'm looking to open a $5k tradestation account. trade YM, 1 contract.
i have been thinking a 10 point stop, 20 point daily profit target. do those sound reasonable? I would like to then add in another 5k to the account once i'm consistent to be able to scale with 2 contracts.

any general mistakes anyone made they would like to share that might be able to avoid?

also, did anyone not blow up their first account? I realize that may be a given on this account.

Quite by coincidence there is a similar question on ET

http://www.elitetrader.com/vb/showth...threadid=94282

[darthtrader]

thanks for the Elitetrader link. In all honesty since finding this board elite has become quite hard to read. so much garbage to sift through and seemingly angry responses, like "go flip burgers" in that thread posted.

I was actually look at the ninja trader the other day. something that looked interesting is the replay function. is it possible say replay the day and paper trade at 10pm for practice?

I'm sure I will paper trade for a bit when i get going but I didnt really get much from paper trading stocks.

also, have any of you backtested your setups with different stops? that is something i will be interested in checking out once i get going.

[The Bear]

I too never got much from paper trading. I like to put a little something on the line to make it real.

Regarding Tradestation, I've used it quite a bit and it works fine for trading 1 YM contract. I rarely get slippage on the stops (STOP MARKET), maybe 1 tick of slippage on 100 trades. I use limit orders for entry and it works fine.

[bakrob99]

Darthtrader

ESignal has a tick by tick replay function so you can replay the day later on ... TS does not.

I have traded TS using 1 contract and market orders and found it quite difficult to consistently make money. Main reason - you really need to be able to scale out - so my advice would be to find 1 (just one) setup that works for you and trade it using a simulator for a while - then when you start trading for real use at least 2 contracts and scale out of the first at a point that your entry hits it 75% of the time before it hits your stop loss... then let the other contract run.

Originally Posted by The Bear »

I too never got much from paper trading. I like to put a little something on the line to make it real.

Regarding Tradestation, I've used it quite a bit and it works fine for trading 1 YM contract. I rarely get slippage on the stops (STOP MARKET), maybe 1 tick of slippage on 100 trades. I use limit orders for entry and it works fine.

For trading energy contracts though, how does this work out for you?