10 Pips a Day to Wealth - guaranteed

[cooter]

In the VSA thread, PivotProfiler wrote the compelling post, which I've snipped here, as I didn't want to clutter that thread with my musings:

	Quote:	PivotProfiler
	First: This is not a picture of the futures, but the spot. Second: 1pip = 10 dollars 10=100 5*10=500 (5 contracts) 10*10=1000 (10 contracts) You want more money, trade more contracts. I am not calling you a losing trader, but that is a losing trader's mentality. A trader could be set for life if he could make 10 pips (net) a day every day. Not all trades need to be 150 pips. Greed may be good but it gets traders into trouble.

Substitute ticks for pips, and say, the ER2 Russell e-mini for your favorite spot forex, and it becomes apparent that this is potentially doable for any futures trader.

My simple question is... if netting 10 pips or ticks a day is all it takes to achieve immortality (or at least everlasting wealth), why is it so many traders are having issues doing so? Any thoughts?

[bakrob99]

I agree. BUT the catch is it requires consistency - every day +10 ... not easy

You will have to do better on some days to make up for the inevitable loss days.

[cooter]

If you quit trading when you are +10 or greater, then you wouldn't have that problem.

It's been argued elsewhere about the merits and pitfalls of taking everyone of your setups when you see them during the trading day.

Is that what you mean about consistency?

[bh_trade]

I think I can answer your question. For most people, myself included, it is easier to be methodical and disciplined when trading a contract size you are comfortable with. I trade ER2 exclusively for a living and my scale in/out size is 2-8 contracts, never trade less than 2, never more than 8. My account size has grown significantly since I began and I know I should "step it up" so to speak. Problem is, I have become comfortable with the risk I take and "stepping up" that risk would make me more emotional than I care to be. Something I need to work on for sure.

[brownsfan019]

Great topic...

I've gone back and forth over the years of taking 2 ES pts and walking away vs. taking everything on the day and my conclusion was that you need to take all your setups as some days are +10 pts and some are +1. This is what I found for my trading. Some days are a gift from the trading gods and other days they are punishing me is what it feels like. On the 'gift' days, I have to take the gifts all day, every day.

For example, this morning thus far has been blah on the ES. Just not a ton of movement right now so my short at 8:10am EST hit one profit target and the remaining contracts were trailed out. Nothing exciting. Meanwhile Wed was a day that just kept on giving. And giving. Now if I had stopped at +2 on Wed, I would have literally left a few thousand dollars on the table. And today I am waiting patiently to try to make a few bucks. See the difference? Stopping at 2 just capped my upside and made days like today much more important, which is completely backwards in my opinion. I don't need chop days to become important and weigh heavy in my outcomes. I need days like Wed to be the most important!

[wsam29]

There is some truth to this money management method but it will only work if you truly accept it as a key method to riches from trading.

I did exactly that when I made $10k trading 1 lot of SP, my exit plan was screwy, in fact did not have one back then, but the profit targets were from 2 ticks ($50)to 40 ticks($1000), 100% discretionary.

Believe me, I practically shot from the hip back in those days.

Trading more lots comes with time and the stomach to take those loses and wins when the occur. I remember reading an article from Stocks and Commodities and it illustrated just that, when you first start out, you can only stomach small loses, but as you gain more experience, your ability to take large loses increase. Only you know just how much pain you can take, not basing it off your strategy and its winning probabilities because in my opinion, if you have a 80% winning strategy, it only takes that 1 time when you take a big hit to totally lose confidence in it. Had that lose been kept small, well you get the idea.

I SHOULD HAVE READ THE WHOLE INITIAL POST!!!

Why do traders have a hard time walking away after they make their targets and points?

What else are they gonna do for the rest of the day???

Heck people think to be a trader, one must always trade or be on the look out for a trade. People may be trading for the sake of trading and not about the money, but then they say to themselves, that contradicts what traders do, its not about the money. Heck it took me a long time to get over that. It is about the money, you need to have a total lack of disregard when you lose, but keep it when you gain it. Still a total contradiction if you ask me and makes no sense.

There are many reasons in my mind why people cannot follow that, win or lose, call it a day mentality. Some people just like the action. Some what to make a point to themselves and to others that they know what the heck they are doing.

[wsam29]

	Quote:	bh_trade
	I think I can answer your question. For most people, myself included, it is easier to be methodical and disciplined when trading a contract size you are comfortable with. I trade ER2 exclusively for a living and my scale in/out size is 2-8 contracts, never trade less than 2, never more than 8. My account size has grown significantly since I began and I know I should "step it up" so to speak. Problem is, I have become comfortable with the risk I take and "stepping up" that risk would make me more emotional than I care to be. Something I need to work on for sure.

2-8 lots eh?

heck try 2-9, just add that 1 lot to your max, but it may mess with your exit ratios. :p

[notouch]

What stops would you use in your quest for 10 points a day? If a 10 point stop then what happens when you lose 3 and are -30 for the day? You now need +40 to pull it back. 2 more losses and you've wiped out a week's profits.

[cooter]

	Quote:	notouch
	What stops would you use in your quest for 10 points a day? If a 10 point stop then what happens when you lose 3 and are -30 for the day? You now need +40 to pull it back. 2 more losses and you've wiped out a week's profits.

Stops are a fact of life for traders. If you get stopped out 3 times in a row in a day (or series of trades), you need to step back, stop trading, and evaluate your trading plan and setup.

That means checking to make sure your entries and exits were valid and per your plan - assuming the setup works and has a reasonable positive expectancy for you.

The one thing you don't want to do is "chasing your own tail", trying to make up lost profits by recklessly overtrading.

[brownsfan019]

	Quote:	notouch
	What stops would you use in your quest for 10 points a day? If a 10 point stop then what happens when you lose 3 and are -30 for the day? You now need +40 to pull it back. 2 more losses and you've wiped out a week's profits.

I couldn't agree more.

Limiting your upside and knowing stops are going to happen is a recipe for an uphill battle in my opinion.